Supply chain – The COVID-19 pandemic has definitely had the impact of its effect on the world. health and Economic indicators have been affected and all industries are touched in a way or even some other. Among the industries in which this was clearly visible is the farming as well as food business.
Throughout 2019, the Dutch extension as well as food sector contributed 6.4 % to the gross domestic item (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands dropped € 7.1 billion within 2020. The hospitality business lost 41.5 % of its turnover as show by ProcurementNation, while at exactly the same time supermarkets enhanced their turnover with € 1.8 billion.
Disruptions in the food chain have significant effects for the Dutch economy and food security as many stakeholders are impacted. Though it was clear to most individuals that there was a significant impact at the conclusion of the chain (e.g., hoarding in food markets, eateries closing) and at the beginning of this chain (e.g., harvested potatoes not finding customers), there are a lot of actors in the source chain for that will the effect is less clear. It is therefore imperative that you find out how properly the food supply chain as a whole is actually equipped to contend with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen Faculty and coming from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID-19 pandemic throughout the food supplies chain. They based their analysis on interviews with about thirty Dutch supply chain actors.
Demand within retail up, contained food service down It’s apparent and widely known that need in the foodservice stations went down on account of the closure of joints, amongst others. In a few cases, sales for suppliers of the food service business thus fell to about twenty % of the original volume. Being an adverse reaction, demand in the list stations went up and remained within a level of about 10-20 % greater than before the crisis started.
Goods that had to come through abroad had the own issues of theirs. With the shift in desire coming from foodservice to retail, the requirement for packaging improved dramatically, More tin, cup or plastic was necessary for use in customer packaging. As much more of this product packaging material ended up in consumers’ homes instead of in restaurants, the cardboard recycling system got disrupted also, causing shortages.
The shifts in demand have had a big effect on production activities. In a few cases, this even meant the full stop in production (e.g. in the duck farming industry, which came to a standstill on account of demand fall out inside the foodservice sector). In other cases, a big part of the personnel contracted corona (e.g. to the meat 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 soon in 2020. This resulted in transport capacity which is limited during the earliest weeks of the problems, and expenses that are high for container transport as a result. Truck travel encountered various issues. Initially, there were uncertainties regarding how transport would be handled at borders, which in the long run were not as stringent as feared. The thing that was problematic in situations which are many, however, was the accessibility of motorists.
The reaction to COVID 19 – deliver chain resilience The source chain resilience analysis held by Prof. de Colleagues and Leeuw, was used on the overview of this main components of supply chain resilience:
Using this particular framework for the analysis of the interview, the results indicate that not many organizations were well prepared for the corona crisis and in reality mainly applied responsive methods. The most notable source chain lessons were:
Figure 1. Eight best practices for food supply chain resilience
First, the need to create the supply chain for flexibility and agility. This seems particularly complicated for smaller companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations usually do not have the capability to do so.
Next, it was discovered that much more attention was necessary on spreading threat and also aiming for risk reduction inside the supply chain. For the future, what this means is far more attention should be provided to the manner in which companies count on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization as well as intelligent rationing strategies in situations where demand can’t be met. Explicit prioritization is required to keep on to meet market expectations but additionally to increase market shares wherein competitors miss options. This task isn’t new, although it has additionally been underexposed in this specific problems and was often not a part of preparatory pursuits.
Fourthly, the corona crisis shows you us that the monetary impact of a crisis also relies on the manner in which cooperation in the chain is actually set up. It’s usually unclear exactly how extra expenses (and benefits) are actually distributed in a chain, in case at all.
Lastly, relative to other purposeful departments, the businesses and supply chain works are actually in the driving accommodate during a crisis. Product development and advertising and marketing activities have to go hand in hand with supply chain events. Whether or not the corona pandemic will structurally change the classic considerations between logistics and production on the one hand as well as marketing 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?