Supply chain – The COVID 19 pandemic has certainly had the impact of its effect on the planet. health and Economic indicators have been compromised and all industries have been completely touched in one of the ways or even another. Among the industries in which it was clearly obvious will be the agriculture and food business.
Throughout 2019, the Dutch farming and food sector contributed 6.4 % to the yucky domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice business in the Netherlands dropped € 7.1 billion in 2020. The hospitality business lost 41.5 % of the turnover of its as show by ProcurementNation, while at exactly the same time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have significant consequences for the Dutch economy and food security as many stakeholders are impacted. Even though it was apparent to many individuals that there was a big effect at the end of the chain (e.g., hoarding around grocery stores, restaurants closing) and also at the beginning of this chain (e.g., harvested potatoes not finding customers), you will find numerous actors inside the supply chain for that the effect is less clear. It’s therefore important to determine how properly the food supply chain as a whole is prepared to contend with disruptions. Researchers in the Operations Research as well as Logistics Group at Wageningen University and also coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID-19 pandemic throughout the food supply chain. They based their analysis on interviews with around thirty Dutch supply chain actors.
Demand in retail up, that is found food service down It’s apparent and widely known that need in the foodservice stations went down on account of the closure of restaurants, amongst others. In a few cases, sales for suppliers in the food service business thus fell to aproximatelly twenty % of the initial volume. Being a side effect, demand in the retail stations went up and remained at a level of aproximatelly 10 20 % higher than before the problems started.
Products which had to come through abroad had the own issues of theirs. With the change in desire from foodservice to retail, the need for packaging changed considerably, More tin, glass and plastic material was required for wearing in buyer packaging. As more of this particular product packaging material ended up in consumers’ homes instead of in restaurants, the cardboard recycling system got disrupted too, causing shortages.
The shifts in desire have had a big effect on output activities. In certain instances, this even meant a full stop in output (e.g. inside the duck farming business, which came to a standstill due to demand fall out inside the foodservice sector). In other instances, a big portion of the personnel contracted corona (e.g. in the various meats processing industry), resulting in a closure of equipment.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis in China sparked the flow of sea bins to slow down pretty shortly in 2020. This resulted in transport electrical capacity which is restricted throughout the very first weeks of the issues, and high expenses for container transport as a consequence. Truck transportation experienced different issues. Initially, there were uncertainties regarding how transport would be managed at borders, which in the long run weren’t as strict as feared. What was problematic in situations which are many, nevertheless, was the accessibility of drivers.
The reaction to COVID 19 – provide chain resilience The source chain resilience analysis held by Prof. de Colleagues and Leeuw, was used on the overview of the core elements of supply chain resilience:
To us this particular framework for the evaluation of the interview, the conclusions show that not many businesses had been well prepared for the corona problems and in reality mostly applied responsive methods. Probably the most important supply chain lessons were:
Figure 1. Eight best practices for meals supply chain resilience
To begin with, the need to develop the supply chain for agility as well as versatility. This seems particularly complicated for smaller companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations often don’t have the capability to do it.
Next, it was found that more attention was needed on spreading danger as well as aiming for risk reduction within the supply chain. For the future, what this means is far more attention has to be given to the way businesses rely on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and smart rationing strategies in situations where need cannot be met. Explicit prioritization is needed to continue to satisfy market expectations but also to increase market shares in which competitors miss options. This challenge is not new, although it’s also been underexposed in this problems and was often not a component of preparatory activities.
Fourthly, the corona problems shows us that the financial result of a crisis in addition depends on the manner in which cooperation in the chain is set up. It’s usually unclear how extra costs (and benefits) are sent out in a chain, if at all.
Last but not least, relative to other purposeful departments, the operations and supply chain features are in the driving seat during a crisis. Product development and marketing activities need to go hand deeply in hand with supply chain events. Regardless of whether the corona pandemic will structurally switch the traditional considerations between production and logistics on the one hand and marketing on the other hand, the long term will need to tell.
How’s the Dutch meal supply chain coping during the corona crisis?