Supply chain – The COVID-19 pandemic has definitely had its impact impact on the planet. health and Economic indicators have been compromised and all industries are touched in a way or even yet another. Among the industries in which this was clearly obvious is the agriculture as well as food industry.
In 2019, the Dutch extension as well as food niche contributed 6.4 % to the yucky domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands dropped € 7.1 billion inside 2020. The hospitality business 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 in the food chain have significant effects for the Dutch economy as well as food security as lots of stakeholders are impacted. Though it was apparent to numerous people that there was a great effect at the conclusion of this chain (e.g., hoarding around supermarkets, restaurants closing) and also at the start of the chain (e.g., harvested potatoes not searching for customers), there are a lot of actors in the source chain for which the impact is less clear. It is thus important to determine how well the food supply chain as a whole is armed to deal with disruptions. Researchers from the Operations Research as well as Logistics Group at Wageningen University as well as coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID-19 pandemic throughout the food resources chain. They based their examination on interviews with about 30 Dutch supply chain actors.
Need within retail up, in food service down It’s obvious and well known that need in the foodservice stations went down as a result of the closure of joints, amongst others. In certain cases, sales for vendors of the food service industry as a result fell to about twenty % of the first volume. Being an adverse reaction, demand in the retail channels went up and remained within a quality of about 10 20 % higher than before the crisis started.
Products that had to come from abroad had the own issues of theirs. With the change in need from foodservice to retail, the requirement for packaging improved considerably, More tin, glass and plastic material was required for use in consumer packaging. As more of this packaging material ended up in consumers’ homes instead of in restaurants, the cardboard recycling function got disrupted also, causing shortages.
The shifts in desire have had an important impact on output activities. In certain cases, this even meant a full stop of production (e.g. in the duck farming business, which arrived to a standstill due to demand fall out in the foodservice sector). In other instances, a significant portion of the personnel contracted corona (e.g. to the various meats processing industry), causing a closure of facilities.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis of China caused the flow of sea bins to slow down fairly soon in 2020. This resulted in transport electrical capacity which is limited during the first weeks of the problems, and high expenses for container transport as a consequence. Truck transportation experienced different issues. To begin with, there were uncertainties regarding how transport would be handled for borders, which in the long run were not as strict as feared. That which was problematic in instances that are a large number of , nonetheless, was the availability of motorists.
The reaction to COVID-19 – supply chain resilience The supply chain resilience evaluation held by Prof. de Leeuw and Colleagues, was based on the overview of this primary components of supply chain resilience:
Using this particular framework for the analysis of the interviews, the findings show that not many businesses had been well prepared for the corona problems and actually mainly applied responsive methods. Probably the most notable supply chain lessons were:
Figure one. 8 best methods for food supply chain resilience
For starters, the need to design the supply chain for flexibility and agility. This seems especially complicated for smaller companies: building resilience into a supply chain takes time and attention in the organization, and smaller organizations usually do not have the capability to do so.
Next, it was found that much more attention was required on spreading danger as well as aiming for risk reduction inside the supply chain. For the future, meaning more attention should be given to the manner in which organizations rely on suppliers, customers, and specific countries.
Third, attention is required for explicit prioritization and clever rationing strategies in situations in which need can’t be met. Explicit prioritization is actually needed to keep on to meet market expectations but also to boost market shares wherein competitors miss options. This particular task is not new, although it has in addition been underexposed in this specific problems and was often not part of preparatory activities.
Fourthly, the corona crisis shows you us that the financial effect of a crisis additionally relies on the manner in which cooperation in the chain is actually set up. It’s usually unclear exactly how further expenses (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 characteristics 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 activities. Whether or not the corona pandemic will structurally switch the traditional considerations between logistics and creation on the one hand as well as advertising on the other hand, the potential future must explain to.
How is the Dutch food supply chain coping throughout the corona crisis?