Supply chain - The COVID 19 pandemic has definitely had its impact effect on the planet. Economic indicators and health have been affected and all industries are touched in one way or perhaps some other. Among the industries in which it was clearly obvious will be the agriculture as well as food industry.
Throughout 2019, the Dutch extension and food niche contributed 6.4 % to the gross domestic product (CBS, 2020). Based on the FoodService Instituut, the foodservice business in the Netherlands lost € 7.1 billion inside 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the same time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have major effects for the Dutch economy as well as food security as many stakeholders are affected. Even though it was clear to numerous folks that there was a huge 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 many actors within the supply chain for that will the impact is much less clear. It is thus vital that you find out how properly the food supply chain as a whole is actually armed to deal with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen Faculty as well as coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the influences of the COVID 19 pandemic all over the food resources chain. They based their analysis on interviews with about thirty Dutch source chain actors.
Need in retail up, in food service down It is obvious and well known that need in the foodservice channels went down on account of the closure of restaurants, amongst others. In some instances, sales for suppliers of the food service industry as a result fell to aproximatelly twenty % of the first volume. Being an adverse reaction, demand in the list stations went up and remained at a quality of aproximatelly 10-20 % higher than before the crisis started.
Products that had to come from abroad had their very own problems. With the shift in demand coming from foodservice to retail, the requirement for packaging improved considerably, More tin, glass and plastic material was needed for wearing in buyer packaging. As much more of this product packaging material ended up in consumers' homes instead of in restaurants, the cardboard recycling system got disrupted too, causing shortages.
The shifts in need have had an important affect on production activities. In some instances, this even meant a total stop of output (e.g. inside the duck farming business, which arrived to a standstill on account of demand fall-out on the foodservice sector). In other instances, a significant portion of the personnel contracted corona (e.g. in the meat processing industry), leading to a closure of equipment.
Supply chain - Distribution activities were also affected. The beginning of the Corona crisis in China triggered the flow of sea bins to slow down pretty soon in 2020. This resulted in limited transport capability during the first weeks of the issues, and expenses that are high for container transport as a consequence. Truck transportation faced different issues. To begin with, there were uncertainties regarding how transport will be handled at borders, which in the long run weren't as stringent as feared. The thing that was problematic in instances that are a large number of , however, was the availability of drivers.
The reaction to COVID 19 - provide chain resilience The supply chain resilience evaluation held by Prof. de Colleagues as well as Leeuw, was used on the overview of this main components of supply chain resilience:
To us this particular framework for the evaluation of the interviews, the conclusions indicate that not many businesses were well prepared for the corona crisis and in reality mostly applied responsive practices. The most notable supply chain lessons were:
Figure 1. 8 best methods for food supply chain resilience
To begin with, the need to develop the supply chain for versatility and agility. This looks especially 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 capacity to do it.
Second, it was observed that much more attention was required on spreading danger and also aiming for risk reduction in the supply chain. For the future, this means more attention should be given to the manner in which organizations rely on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization and smart rationing strategies in situations where need can't be met. Explicit prioritization is actually necessary to keep on to satisfy market expectations but in addition to boost market shares where competitors miss options. This particular challenge is not new, although it's additionally been underexposed in this crisis and was usually not part of preparatory activities.
Fourthly, the corona issues shows us that the financial impact of a crisis in addition depends on the manner in which cooperation in the chain is actually set up. It's often unclear exactly how additional expenses (and benefits) are actually sent out in a chain, if at all.
Finally, relative to other functional departments, the operations and supply chain functionality are in the driving accommodate during a crisis. Product development and marketing activities have to go hand deeply in hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally replace the basic considerations between generation and logistics on the one hand and advertising and marketing on the other hand, the long term will need to tell.
How's the Dutch foods supply chain coping throughout the corona crisis?