Supply chain – The COVID 19 pandemic has undoubtedly had its impact effect on the world. health and Economic indicators have been compromised and all industries are touched within a way or some other. Among the industries in which this was clearly apparent will be the farming as well as food business.
In 2019, the Dutch agriculture and food industry contributed 6.4 % to the gross domestic item (CBS, 2020). According to the FoodService Instituut, the foodservice industry in the Netherlands dropped € 7.1 billion in 2020. The hospitality trade 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 of the food chain have big consequences for the Dutch economy as well as food security as lots of stakeholders are impacted. Despite the fact that it was clear to most individuals that there was a significant impact at the conclusion of the chain (e.g., hoarding doing grocery stores, restaurants closing) as well as at the start of the chain (e.g., harvested potatoes not finding customers), there are a lot of actors in the supply chain for that will the impact is less clear. It is therefore vital that you figure out how properly the food supply chain as being a whole is prepared to contend with disruptions. Researchers in the Operations Research and Logistics Group at Wageningen University and also from Wageningen Economics Research, led by Professor Sander de Leeuw, analyzed the effects of the COVID 19 pandemic throughout the food resources chain. They based the examination of theirs on interviews with around thirty Dutch supply chain actors.
Demand within retail up, found food service down It’s apparent and popular that demand in the foodservice stations went down as a result of the closure of joints, amongst others. In a few instances, sales for vendors in the food service business as a result fell to about 20 % of the original volume. As a complication, demand in the retail stations went up and remained at a degree of aproximatelly 10 20 % higher than before the problems started.
Products that had to come via abroad had their own issues. With the change in need from foodservice to retail, the need for packaging improved dramatically, More tin, glass or plastic material was required for wearing in consumer packaging. As more of this particular product packaging material concluded up in consumers’ houses as opposed to in places, the cardboard recycling function got disrupted also, causing shortages.
The shifts in desire have had an important impact on production activities. In certain cases, this even meant a total stop in production (e.g. in the duck farming business, which arrived to a standstill on account of demand fall-out in the foodservice sector). In other situations, a significant part of the personnel contracted corona (e.g. in the meat processing industry), causing a closure of facilities.
Supply chain – Distribution activities were also affected. The start of the Corona crisis in China caused the flow of sea canisters to slow down fairly shortly in 2020. This resulted in transport capability that is restricted throughout the first weeks of the problems, and expenses which are high for container transport as a direct result. Truck travel faced different problems. At first, there were uncertainties regarding how transport will be handled at borders, which in the long run were not as strict as feared. That which was problematic in cases that are most , nevertheless, was the availability of drivers.
The response to COVID 19 – provide chain resilience The source chain resilience analysis held by Prof. de Leeuw as well as Colleagues, was used on the overview of the main elements of supply chain resilience:
Using this framework for the assessment of the interview, the results indicate that not many companies had been nicely prepared for the corona problems and in fact mostly applied responsive methods. Probably the most notable source chain lessons were:
Figure 1. Eight best practices for food supply chain resilience
To begin with, the need to design the supply chain for agility as well as versatility. This seems especially challenging for smaller companies: building resilience into a supply chain takes attention and time in the organization, and smaller organizations oftentimes don’t have the capacity to do it.
Second, it was observed that much more interest was required on spreading risk and also aiming for risk reduction in the supply chain. For the future, this means more attention should be provided to the manner in which organizations count on specific countries, customers, and suppliers.
Third, attention is necessary for explicit prioritization and clever rationing techniques in cases in which need can’t be met. Explicit prioritization is necessary to continue to satisfy market expectations but additionally to improve market shares where competitors miss opportunities. This particular task isn’t new, but it has also been underexposed in this specific problems and was frequently not a part of preparatory activities.
Fourthly, the corona crisis shows us that the monetary effect of a crisis also depends on the manner in which cooperation in the chain is actually set up. It is typically unclear exactly how further costs (and benefits) are actually sent out in a chain, if at all.
Finally, relative to other purposeful departments, the businesses and supply chain operates 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. Regardless of whether the corona pandemic will structurally switch the basic discussions between logistics and generation on the one hand as well as marketing and advertising on the other, the long term will need to explain to.
How is the Dutch food supply chain coping during the corona crisis?