How\\\’s the Dutch food supply chain coping throughout the corona crisis?
Supply chain – The COVID-19 pandemic has definitely had the impact of its impact on the planet. health and Economic indicators have been affected and all industries have been touched inside one way or perhaps some other. One of the industries in which this was clearly noticeable would be the farming as well as food industry.
Throughout 2019, the Dutch farming as well as food sector contributed 6.4 % to the yucky domestic item (CBS, 2020). Based on the FoodService Instituut, the foodservice industry in the Netherlands lost € 7.1 billion within 2020. The hospitality industry lost 41.5 % of the turnover of its as show by ProcurementNation, while at the same time supermarkets enhanced the turnover of theirs with € 1.8 billion.
Disruptions of the food chain have significant effects for the Dutch economy and food security as lots of stakeholders are impacted. Despite the fact that it was clear to numerous people that there was a huge impact at the conclusion of this chain (e.g., hoarding doing grocery stores, eateries closing) and at the start of this chain (e.g., harvested potatoes not finding customers), you will find numerous actors inside the supply chain for that will the impact is much less clear. It’s therefore imperative that you determine how properly the food supply chain as a whole is actually equipped to contend with disruptions. Researchers from the Operations Research and Logistics Group at Wageningen University and also 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 around 30 Dutch supply chain actors.
Demand within retail up, found food service down It’s obvious and well known that demand in the foodservice channels went down on account of the closure of places, amongst others. In some instances, sales for vendors of the food service business thus fell to about twenty % of the initial volume. Being a side effect, demand in the list channels went up and remained within a level of about 10-20 % higher than before the problems started.
Goods that had to come from abroad had their very own issues. With the shift in need coming from foodservice to retail, the requirement for packaging improved dramatically, More tin, cup or plastic material was needed for use in customer packaging. As more of this particular packaging material ended up in consumers’ houses instead of in restaurants, the cardboard recycling system got disrupted as well, causing shortages.
The shifts in need have had a significant impact on production activities. In a few instances, this even meant a full stop of production (e.g. in the duck farming industry, which arrived to a standstill due to demand fall out in the foodservice sector). In other cases, a significant portion of the personnel contracted corona (e.g. in the meat processing industry), leading to a closure of facilities.
Supply chain – Distribution pursuits were also affected. The start of the Corona crisis in China sparked the flow of sea canisters to slow down fairly soon in 2020. This resulted in limited transport capacity during the very first weeks of the problems, and high expenses for container transport as a direct result. Truck travel faced different problems. Initially, there were uncertainties regarding how transport would be managed at borders, which in the end weren’t as strict as feared. The thing that was problematic in instances which are most, nonetheless, was the accessibility of drivers.
The response to COVID-19 – deliver chain resilience The supply chain resilience evaluation held by Prof. de Colleagues and Leeuw, was based on the overview of this primary elements of supply chain resilience:
Using this framework for the evaluation of the interviews, the results indicate that few businesses were nicely prepared for the corona problems and in fact mostly applied responsive practices. Probably the most important source chain lessons were:
Figure one. 8 best practices for food supply chain resilience
To begin with, the need to create the supply chain for agility and versatility. This seems especially challenging for smaller companies: building resilience right into a supply chain takes time and attention in the business, and smaller organizations often don’t have the potential to do so.
Next, it was observed that much more attention was required on spreading threat and aiming for risk reduction inside the supply chain. For the future, what this means is far more attention has to be given to the manner in which companies rely on suppliers, customers, and specific countries.
Third, attention is needed for explicit prioritization as well as intelligent rationing strategies in situations in which demand cannot be met. Explicit prioritization is actually needed to continue to meet market expectations but additionally to improve market shares where competitors miss options. This particular task is not new, although it has in addition been underexposed in this specific crisis and was often not part of preparatory activities.
Fourthly, the corona crisis teaches us that the monetary effect of a crisis in addition relies on the manner in which cooperation in the chain is actually set up. It’s usually unclear how further costs (and benefits) are distributed in a chain, in case at all.
Lastly, relative to other purposeful departments, the operations and supply chain functions are in the driving accommodate during a crisis. Product development and marketing activities have to go hand in deep hand with supply chain events. Regardless of whether the corona pandemic will structurally change the basic discussions between logistics and generation on the one hand as well as advertising on the other hand, the future will have to explain to.
How is the Dutch meal supply chain coping during the corona crisis?