Supply chain – The COVID-19 pandemic has undoubtedly had its impact influence on the world. health and Economic indicators have been compromised and all industries have been touched inside one of the ways or perhaps another. Among the industries in which it was clearly visible would be the agriculture and food industry.
Throughout 2019, the Dutch extension as well as food niche 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 in 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets enhanced their turnover with € 1.8 billion.
Disruptions of the food chain have major effects for the Dutch economy and food security as many stakeholders are affected. Even though it was apparent to majority of people that there was a huge effect at the end of the chain (e.g., hoarding around grocery stores, eateries closing) as well as at the start of this chain (e.g., harvested potatoes not finding customers), there are a lot of actors in the supply chain for that will the impact is much less clear. It is therefore imperative that you figure out how properly the food supply chain as a whole is actually armed to cope with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen University as well as coming from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the consequences 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, contained food service down It is apparent and well known that need in the foodservice channels went down on account of the closure of joints, amongst others. In some cases, sales for suppliers in the food service business as a result fell to about 20 % of the initial volume. Being a side effect, demand in the retail channels went up and remained within a degree of aproximatelly 10 20 % higher than before the crisis started.
Products that had to come through abroad had their own problems. With the shift in demand from foodservice to retail, the need for packaging changed considerably, More tin, glass or plastic was necessary for use in buyer packaging. As much more of this packaging material ended up in consumers’ homes as opposed to in restaurants, the cardboard recycling system got disrupted too, causing shortages.
The shifts in desire have had a major affect on production activities. In some instances, this even meant a complete stop in production (e.g. within the duck farming industry, which came to a standstill on account of demand fall-out on the foodservice sector). In other situations, a significant part of the personnel contracted corona (e.g. to the various meats processing industry), resulting in a closure of equipment.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis of China caused the flow of sea bins to slow down pretty soon in 2020. This resulted in restricted transport capacity during the first weeks of the problems, and high costs for container transport as a result. Truck transportation experienced various issues. Initially, there were uncertainties about how transport would be managed at borders, which in the end weren’t as strict as feared. The thing that was problematic in a large number of instances, however, was the accessibility of drivers.
The response to COVID 19 – provide chain resilience The source chain resilience analysis held by Prof. de Leeuw and Colleagues, was based on the overview of this core things of supply chain resilience:
To us this particular framework for the evaluation of the interview, the findings indicate that not many companies were well prepared for the corona problems and in reality mainly applied responsive methods. The most important source chain lessons were:
Figure 1. Eight best practices for food supply chain resilience
First, the need to design the supply chain for agility as well as flexibility. This seems particularly challenging for small companies: building resilience right into a supply chain takes time and attention in the organization, and smaller organizations oftentimes don’t have the capability to accomplish that.
Second, it was discovered that much more interest was necessary on spreading threat as well as aiming for risk reduction inside the supply chain. For the future, what this means is more attention should be made available to the manner in which businesses rely on specific countries, customers, and suppliers.
Third, attention is required for explicit prioritization as well as intelligent rationing techniques in situations in which need cannot be met. Explicit prioritization is required to keep on to meet market expectations but in addition to boost market shares wherein competitors miss opportunities. This challenge is not new, but it’s in addition been underexposed in this problems and was frequently not a component of preparatory activities.
Fourthly, the corona crisis shows you us that the economic result of a crisis additionally relies on the manner in which cooperation in the chain is actually set up. It’s typically unclear precisely how further costs (and benefits) are distributed in a chain, in case at all.
Last but not least, relative to other functional departments, the businesses and supply chain functionality are in the driving seat during a crisis. Product development and advertising activities have to go hand in hand with supply chain events. Regardless of whether the corona pandemic will structurally change the basic considerations between logistics and creation on the one hand and advertising and marketing on the other, the potential future will need to explain to.
How is the Dutch foods supply chain coping during the corona crisis?