Supply chain – The COVID 19 pandemic has certainly had the impact of its impact on the world. Economic indicators and health have been compromised and all industries have been touched in one way or even yet another. Among the industries in which this was clearly apparent is the agriculture as well as food industry.
Throughout 2019, the Dutch extension as well as food sector contributed 6.4 % to the gross domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice industry in the Netherlands dropped € 7.1 billion within 2020. The hospitality business lost 41.5 % of its turnover as show by ProcurementNation, while at the identical time supermarkets enhanced their turnover with € 1.8 billion.
Disruptions of the food chain have significant consequences for the Dutch economy as well as food security as lots of stakeholders are affected. Though it was clear to numerous individuals that there was a significant impact at the conclusion of the chain (e.g., hoarding around grocery stores, restaurants closing) and also at the start of this chain (e.g., harvested potatoes not searching for customers), there are a lot of actors in the supply chain for that the impact is much less clear. It is therefore imperative that you figure out how effectively the food supply chain as a whole is equipped to deal with disruptions. Researchers from the Operations Research as well as Logistics Group at Wageningen University and also from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences of the COVID 19 pandemic throughout the food supplies chain. They based the examination of theirs on interviews with around 30 Dutch source chain actors.
Demand within retail up, contained food service down It’s obvious and widely known that need in the foodservice stations went down due to the closure of restaurants, amongst others. In certain cases, sales for suppliers in the food service business therefore fell to about twenty % of the first volume. As a side effect, demand in the list stations went up and remained at a level of about 10 20 % higher than before the crisis started.
Goods that had to come via abroad had the own issues of theirs. With the shift in demand from foodservice to retail, the demand for packaging improved considerably, More tin, glass or plastic was required for wearing in buyer packaging. As more of this product packaging material concluded up in consumers’ homes as opposed to in places, the cardboard recycling process got disrupted too, causing shortages.
The shifts in demand have had a major effect on production activities. In a few instances, this even meant a full stop of output (e.g. in the duck farming industry, which emerged to a standstill due to demand fall out on the foodservice sector). In other situations, a major portion of the personnel contracted corona (e.g. in the various meats processing industry), leading to a closure of equipment.
Supply chain – Distribution activities were also affected. The beginning of the Corona crisis of China caused the flow of sea canisters to slow down fairly shortly in 2020. This resulted in restricted transport capacity during the first weeks of the crisis, and high expenses for container transport as a consequence. Truck travel experienced various problems. To begin with, there were uncertainties about how transport will be handled at borders, which in the long run were not as strict as feared. That which was problematic in most cases, nevertheless, was the accessibility of motorists.
The response to COVID-19 – provide chain resilience The supply chain resilience evaluation held by Prof. de Leeuw and Colleagues, was based on the overview of this core things of supply chain resilience:
To us this framework for the assessment of the interview, the conclusions show that few businesses had been nicely prepared for the corona problems and in fact mostly applied responsive practices. The most important source chain lessons were:
Figure 1. 8 best methods for food supply chain resilience
For starters, the need to create the supply chain for agility as well as versatility. This seems particularly complicated for small companies: building resilience right into a supply chain takes attention and time in the organization, and smaller organizations usually do not have the potential to do so.
Next, it was found that much more attention was required on spreading risk as well as aiming for risk reduction inside the supply chain. For the future, what this means is more attention ought to be made available to the way businesses depend on suppliers, customers, and specific countries.
Third, attention is needed for explicit prioritization as well as clever rationing techniques in cases in which demand can’t be met. Explicit prioritization is necessary to continue to satisfy market expectations but in addition to improve market shares where competitors miss opportunities. This task isn’t new, but it’s additionally been underexposed in this specific crisis and was often not part of preparatory pursuits.
Fourthly, the corona crisis shows you us that the financial impact of a crisis also depends on the manner in which cooperation in the chain is actually set up. It is typically unclear precisely how further expenses (and benefits) are actually distributed in a chain, in case at all.
Last but not least, relative to other functional departments, the businesses and supply chain capabilities are in the driving seat during a crisis. Product development and marketing and advertising activities need to go hand in deep hand with supply chain events. Regardless of whether the corona pandemic will structurally change the basic discussions between production and logistics on the one hand and advertising on the other, the long term will have to explain to.
How’s the Dutch food supply chain coping throughout the corona crisis?