Supply chain – The COVID-19 pandemic has undoubtedly had its impact effect on the planet. Economic indicators and health have been affected and all industries have been completely touched inside one way or even some other. One of the industries in which this was clearly visible is the agriculture as well as food industry.
In 2019, the Dutch agriculture as well as food niche contributed 6.4 % to the gross domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion in 2020. The hospitality trade lost 41.5 % of the turnover of its as show by ProcurementNation, while at exactly the same time supermarkets increased their turnover with € 1.8 billion.
Disruptions of the food chain have major consequences for the Dutch economy and food security as a lot of stakeholders are affected. Even though it was apparent to a lot of individuals that there was a huge impact at the conclusion of the chain (e.g., hoarding around food markets, restaurants closing) and also at the beginning of this chain (e.g., harvested potatoes not searching for customers), there are a lot of actors inside the supply chain for which the effect is much less clear. It’s therefore important to figure out how properly the food supply chain as a whole is actually prepared to cope with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen University and from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the effects of the COVID-19 pandemic all over the food resources chain. They based their examination on interviews with around thirty Dutch source chain actors.
Need in retail up, in food service down It is apparent and well known that need in the foodservice channels went down due to the closure of restaurants, amongst others. In certain cases, sales for vendors in the food service business thus fell to aproximatelly 20 % of the first volume. Being an adverse reaction, demand in the list stations went up and remained at a degree of about 10-20 % greater than before the crisis started.
Goods that had to come via abroad had their own problems. With the shift in demand from foodservice to retail, the need for packaging changed considerably, More tin, glass and plastic material was necessary for wearing in customer packaging. As much more of this particular packaging material ended up in consumers’ homes instead of in places, the cardboard recycling system got disrupted as well, causing shortages.
The shifts in need have had a significant affect on output activities. In certain cases, this even meant a total stop of output (e.g. within the duck farming business, which arrived to a standstill as a result of demand fall-out in the foodservice sector). In other instances, a major part of the personnel contracted corona (e.g. in the various meats processing industry), causing a closure of facilities.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis in China sparked the flow of sea containers to slow down fairly soon in 2020. This resulted in limited transport electrical capacity during the first weeks of the crisis, and high expenses for container transport as a result. Truck transport encountered different issues. To begin with, there were uncertainties on how transport will be managed for borders, which in the long run weren’t as stringent as feared. What was problematic in cases which are a large number of, nevertheless, was the availability of drivers.
The reaction to COVID-19 – supply chain resilience The supply chain resilience evaluation held by Prof. de Leeuw as well as Colleagues, was used on the overview of this primary elements of supply chain resilience:
To us this particular framework for the evaluation of the interview, the findings show that not many businesses were nicely prepared for the corona problems and in reality mostly applied responsive practices. The most notable supply chain lessons were:
Figure one. Eight best practices for meals supply chain resilience
First, the need to create the supply chain for agility as well as versatility. This seems especially complicated for smaller sized companies: building resilience into a supply chain takes attention and time in the business, and smaller organizations oftentimes don’t have the potential to do it.
Next, it was found that much more interest was required on spreading threat and also aiming for risk reduction in the supply chain. For the future, meaning far more attention has to be provided to the way companies count on suppliers, customers, and specific countries.
Third, attention is necessary for explicit prioritization and smart rationing strategies in cases where demand can’t be met. Explicit prioritization is necessary to keep on to satisfy market expectations but in addition to increase market shares where competitors miss opportunities. This particular challenge isn’t new, however, it’s also been underexposed in this specific problems and was usually not a component of preparatory pursuits.
Fourthly, the corona problems shows you us that the financial impact of a crisis additionally is determined by the manner in which cooperation in the chain is set up. It’s often unclear precisely how further expenses (and benefits) are sent out in a chain, in case at all.
Finally, relative to other purposeful departments, the businesses and supply chain functions are actually in the driving accommodate during a crisis. Product development and marketing and advertising activities need to go hand deeply in hand with supply chain activities. Whether or not the corona pandemic will structurally switch the basic discussions between logistics and creation on the one hand and marketing and advertising on the other hand, the potential future will need to explain to.
How is the Dutch meal supply chain coping during the corona crisis?