Supply chain - The COVID 19 pandemic has undoubtedly had its impact influence on the planet. health and Economic indicators have been affected and all industries have been touched within a way or perhaps yet another. Among the industries in which this was clearly apparent would be the agriculture and food business.
In 2019, the Dutch agriculture and food sector contributed 6.4 % to the yucky domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands shed € 7.1 billion inside 2020. The hospitality industry lost 41.5 % of its turnover as show by ProcurementNation, while at exactly the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have big consequences for the Dutch economy as well as food security as a lot of stakeholders are affected. Despite the fact that it was clear to most men and women that there was a great impact at the conclusion of the chain (e.g., hoarding around food markets, restaurants closing) and also at the start of this chain (e.g., harvested potatoes not finding customers), you will find a lot of actors within the supply chain for which the impact is much less clear. It is therefore important to find out how well the food supply chain as a whole is prepared to cope with disruptions. Researchers from your Operations Research and Logistics Group at Wageningen Faculty and coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the effects of the COVID 19 pandemic throughout the food supply chain. They based their examination on interviews with around 30 Dutch source chain actors.
Demand in retail up, that is found food service down It is evident and widely known that demand in the foodservice stations went down as a result of the closure of restaurants, amongst others. In certain instances, sales for vendors in the food service business thus fell to aproximatelly 20 % of the original volume. Being an adverse reaction, demand in the list stations went up and remained within a level of about 10 20 % higher than before the crisis started.
Goods that had to come via abroad had their very own issues. With the shift in desire coming from foodservice to retail, the need for packaging improved considerably, More tin, cup and plastic was needed for use in buyer packaging. As much more of this particular packaging material ended up in consumers' houses instead of in restaurants, the cardboard recycling process got disrupted too, causing shortages.
The shifts in demand have had a significant affect on production activities. In certain cases, this even meant the full stop in production (e.g. inside the duck farming industry, which arrived to a standstill on account of demand fall out inside the foodservice sector). In other instances, a major portion of the personnel contracted corona (e.g. in the various meats processing industry), leading to a closure of facilities.
Supply chain - Distribution activities were also affected. The start of the Corona crisis of China triggered the flow of sea containers to slow down pretty soon in 2020. This resulted in limited transport capacity during the earliest weeks of the problems, and expenses that are high for container transport as a direct result. Truck transportation encountered various issues. Initially, there were uncertainties regarding how transport would be handled at borders, which in the long run were not as strict as feared. What was problematic in instances that are many , nonetheless, was the availability of drivers.
The reaction to COVID-19 - deliver chain resilience The source chain resilience analysis held by Prof. de Colleagues and Leeuw, was based on the overview of this key things of supply chain resilience:
To us this particular framework for the analysis of the interviews, the results indicate that few organizations had been nicely prepared for the corona problems and in reality mostly applied responsive methods. The most notable source chain lessons were:
Figure one. Eight best practices for meals supply chain resilience
To begin with, the need to develop the supply chain for versatility as well as agility. This looks especially complicated for smaller sized companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations usually don't have the capacity to do it.
Second, it was discovered that much more interest was necessary on spreading threat and aiming for risk reduction within the supply chain. For the future, what this means is far more attention has to be made available to the way organizations depend on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and smart rationing techniques in cases in which need cannot be met. Explicit prioritization is necessary to continue to meet market expectations but also to increase market shares wherein competitors miss opportunities. This challenge is not new, but it has in addition been underexposed in this crisis and was often not a part of preparatory pursuits.
Fourthly, the corona issues shows you us that the monetary effect of a crisis in addition depends on the way cooperation in the chain is set up. It is often unclear precisely how further costs (and benefits) are actually sent out in a chain, if at all.
Lastly, relative to other functional departments, the operations and supply chain functionality are in the driving seat during a crisis. Product development and marketing and advertising activities have to go hand deeply in hand with supply chain activities. Regardless of whether the corona pandemic will structurally replace the basic considerations between logistics and generation on the one hand and advertising on the other hand, the long term will need to tell.
How is the Dutch meal supply chain coping during the corona crisis?