Supply chain – The COVID 19 pandemic has certainly had the impact of its influence on the planet. health and Economic indicators have been affected and all industries are touched inside a way or another. One of the industries in which it was clearly apparent would be the agriculture and food industry.
Throughout 2019, the Dutch farming and food sector contributed 6.4 % to the gross domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice industry in the Netherlands shed € 7.1 billion in 2020. The hospitality trade lost 41.5 % of the turnover of its as show by ProcurementNation, while at the identical time supermarkets increased the turnover of theirs with € 1.8 billion.
Disruptions in the food chain have big effects for the Dutch economy and food security as lots of stakeholders are affected. Even though it was clear to most men and women that there was a big effect at the conclusion of this chain (e.g., hoarding in food markets, eateries closing) and also at the start of the chain (e.g., harvested potatoes not finding customers), you will find a lot of actors in the source chain for that will the impact is less clear. It’s therefore imperative that you determine how effectively the food supply chain as being a whole is actually armed to deal with disruptions. Researchers in the Operations Research as well as Logistics Group at Wageningen University and coming from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the effects of the COVID 19 pandemic throughout the food supply chain. They based the analysis of theirs on interviews with about thirty Dutch source chain actors.
Need in retail up, contained food service down It is apparent and popular that need in the foodservice channels went down on account of the closure of joints, amongst others. In certain instances, sales for vendors of the food service business as a result fell to aproximatelly 20 % of the original volume. Being a side effect, demand in the retail channels went up and remained within a quality of about 10-20 % greater than before the problems started.
Goods that had to come from abroad had their own issues. With the shift in need from foodservice to retail, the need for packaging changed considerably, More tin, glass and plastic was necessary for use in customer packaging. As much more of this particular packaging material concluded up in consumers’ homes rather than in places, the cardboard recycling process got disrupted as well, causing shortages.
The shifts in need have had a big impact on output activities. In a few cases, this even meant a total stop in production (e.g. inside the duck farming business, which arrived to a standstill on account of demand fall-out on the foodservice sector). In other cases, a major portion of the personnel contracted corona (e.g. in the meat processing industry), causing a closure of equipment.
Supply chain – Distribution pursuits were also affected. The beginning of the Corona crisis of China caused the flow of sea canisters to slow down fairly shortly in 2020. This resulted in transport capability which is limited throughout the very first weeks of the crisis, and expenses that are high for container transport as a result. Truck transportation experienced various problems. At first, there were uncertainties about how transport would be managed at borders, which in the end weren’t as strict as feared. That which was problematic in instances which are a large number of, nevertheless, was the accessibility of drivers.
The reaction to COVID 19 – deliver chain resilience The source chain resilience evaluation held by Prof. de Leeuw and Colleagues, was used on the overview of the main things of supply chain resilience:
To us this particular framework for the assessment of the interview, the results show that few organizations had been nicely prepared for the corona crisis and in fact mainly applied responsive methods. Probably the most important supply chain lessons were:
Figure 1. Eight best practices for food supply chain resilience
To begin with, the need to create the supply chain for flexibility as well as agility. This appears particularly challenging for smaller sized companies: building resilience into a supply chain takes time and attention in the business, and smaller organizations oftentimes do not have the capability to accomplish that.
Second, it was discovered that more interest was needed on spreading danger and aiming for risk reduction within the supply chain. For the future, this means far more attention ought to be made available to the manner in which organizations depend on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization and clever rationing techniques in cases where need cannot be met. Explicit prioritization is actually necessary to continue to meet market expectations but in addition to boost market shares in which competitors miss options. This task isn’t new, however, it has additionally been underexposed in this specific problems and was usually not a part of preparatory pursuits.
Fourthly, the corona crisis shows you us that the financial impact of a crisis in addition is determined by the way cooperation in the chain is actually set up. It’s typically unclear exactly how additional expenses (and benefits) are actually sent out in a chain, if at all.
Finally, relative to other functional departments, the businesses and supply chain capabilities are actually in the driving accommodate during a crisis. Product development and advertising and marketing activities have to go hand in deep hand with supply chain events. Whether the corona pandemic will structurally replace the classic discussions between logistics and creation on the one hand and marketing and advertising on the other hand, the potential future must explain to.
How’s the Dutch foods supply chain coping during the corona crisis?