Supply chain - The COVID-19 pandemic has certainly had the impact of its impact on the world. health and Economic indicators have been affected and all industries are touched in one of the ways or even some other. One of the industries in which it was clearly visible will be the farming and food industry.
Throughout 2019, the Dutch farming as well as food sector contributed 6.4 % to the gross domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands shed € 7.1 billion in 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at the identical time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have major effects for the Dutch economy as well as food security as a lot of stakeholders are affected. Though it was apparent to numerous men and women that there was a big impact at the conclusion of the chain (e.g., hoarding around supermarkets, restaurants closing) and at the start of this chain (e.g., harvested potatoes not searching for customers), there are numerous actors inside the source chain for which the impact is much less clear. It's therefore important to find out how well the food supply chain as a whole is actually armed to deal with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen Faculty as well as from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID-19 pandemic throughout the food resources chain. They based the analysis of theirs on interviews with around thirty Dutch source chain actors.
Need in retail up, in food service down It is apparent and popular that need in the foodservice channels went down on account of the closure of restaurants, amongst others. In a few cases, sales for vendors in the food service business thus fell to aproximatelly 20 % of the original volume. Being a side effect, demand in the list channels went up and remained at a quality of aproximatelly 10-20 % higher than before the problems started.
Products which had to come via abroad had their own issues. With the shift in desire from foodservice to retail, the demand for packaging improved dramatically, More tin, cup or plastic was required for wearing in buyer packaging. As much more of this product packaging material concluded up in consumers' homes rather than in restaurants, the cardboard recycling system got disrupted too, causing shortages.
The shifts in desire have had a major effect on production activities. In certain instances, this even meant a total stop of output (e.g. within the duck farming industry, which arrived to a standstill due to demand fall out inside the foodservice sector). In other instances, a significant part of the personnel contracted corona (e.g. in the meat processing industry), causing a closure of facilities.
Supply chain - Distribution pursuits were also affected. The beginning of the Corona crisis in China caused the flow of sea bins to slow down fairly shortly in 2020. This resulted in transport capability that is limited throughout the very first weeks of the issues, and costs which are high for container transport as a direct result. Truck transportation faced different issues. To begin with, there were uncertainties about how transport would be handled at borders, which in the end were not as stringent as feared. The thing that was problematic in a large number of instances, nonetheless, was the availability of motorists.
The reaction to COVID 19 - supply chain resilience The supply chain resilience evaluation held by Prof. de Colleagues and Leeuw, was used on the overview of the key elements of supply chain resilience:
To us this framework for the evaluation of the interview, the conclusions show that not many companies were nicely prepared for the corona problems and in fact mostly applied responsive methods. Probably the most important supply chain lessons were:
Figure 1. 8 best methods for food supply chain resilience
First, the need to create the supply chain for agility as well as flexibility. This seems especially complicated for smaller companies: building resilience right into a supply chain takes time and attention in the organization, and smaller organizations usually do not have the capacity to do it.
Second, it was observed that much more interest was necessary on spreading risk as well as aiming for risk reduction in the supply chain. For the future, what this means is more attention ought to be provided to the manner in which businesses rely on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization as well as smart rationing strategies in situations in which demand cannot be met. Explicit prioritization is needed to continue to satisfy market expectations but in addition to improve market shares where competitors miss options. This task is not new, though it has also been underexposed in this specific problems and was usually not a component of preparatory activities.
Fourthly, the corona crisis teaches us that the economic effect of a crisis also relies on the way cooperation in the chain is set up. It is often unclear precisely how further costs (and benefits) are distributed in a chain, if at all.
Lastly, relative to other purposeful departments, the operations and supply chain functions are in the driving accommodate during a crisis. Product development and advertising and marketing activities need to go hand in deep hand with supply chain events. Whether the corona pandemic will structurally change the basic discussions between logistics and generation on the one hand and marketing on the other hand, the future will have to tell.
How is the Dutch meal supply chain coping during the corona crisis?