How is the Dutch meal supply chain coping during the corona crisis?
Supply chain – The COVID 19 pandemic has certainly had its impact impact on the world. health and Economic indicators have been compromised and all industries have been touched in a way or even yet another. One of the industries in which this was clearly apparent is the agriculture as well as food business.
In 2019, the Dutch agriculture as well as food sector contributed 6.4 % to the disgusting domestic product (CBS, 2020). As per the FoodService Instituut, the foodservice business in the Netherlands shed € 7.1 billion in 2020. The hospitality trade lost 41.5 % of its turnover as show by ProcurementNation, while at the same time supermarkets enhanced their turnover 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 affected. Even though it was apparent to a lot of men and women that there was a great effect at the tail end of the chain (e.g., hoarding doing supermarkets, eateries closing) as well as at the start of this chain (e.g., harvested potatoes not searching for customers), there are numerous actors inside the supply chain for that the effect is less clear. It is thus imperative that you find out how properly the food supply chain as a whole is armed to cope with disruptions. Researchers from your Operations Research as well as Logistics Group at Wageningen University and from Wageningen Economics Research, led by Professor Sander de Leeuw, studied the consequences of the COVID-19 pandemic all over the food supply chain. They based their examination on interviews with about 30 Dutch source chain actors.
Need in retail up, found food service down It is apparent and popular that need in the foodservice channels went down on account of the closure of restaurants, amongst others. In a few instances, sales for vendors of the food service industry therefore fell to about twenty % of the original volume. As a complication, demand in the retail stations went up and remained at a level of aproximatelly 10 20 % greater than before the problems started.
Goods that had to come via abroad had their own problems. With the change in desire coming from foodservice to retail, the need for packaging changed dramatically, More tin, glass and plastic was necessary for use in customer packaging. As more of this packaging material concluded up in consumers’ houses as opposed to in restaurants, the cardboard recycling process got disrupted too, causing shortages.
The shifts in desire have had a major impact on output activities. In a few instances, this even meant a complete stop in production (e.g. inside the duck farming business, which arrived to a standstill on account of demand fall-out in the foodservice sector). In other instances, a big part 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 of China triggered the flow of sea containers to slow down fairly shortly in 2020. This resulted in transport electrical capacity which is limited throughout the very first weeks of the crisis, and expenses that are high for container transport as a consequence. Truck transport faced different issues. To begin with, there were uncertainties about how transport will be managed for borders, which in the end weren’t as stringent as feared. What was problematic in instances which are most, nevertheless, was the accessibility of motorists.
The reaction to COVID 19 – provide chain resilience The source chain resilience analysis held by Prof. de Colleagues and Leeuw, was based on the overview of this core elements of supply chain resilience:
Using this framework for the evaluation of the interviews, the results show that few organizations were nicely prepared for the corona problems and actually mainly applied responsive practices. The most notable source chain lessons were:
Figure 1. 8 best practices for food supply chain resilience
To begin with, the need to create the supply chain for agility as well as versatility. This seems especially complicated for smaller sized companies: building resilience right into a supply chain takes attention and time in the organization, and smaller organizations oftentimes do not have the capacity to do so.
Second, it was found that much more interest was necessary on spreading risk and aiming for risk reduction within the supply chain. For the future, meaning more attention has to be given to the manner in which organizations depend on suppliers, customers, and specific countries.
Third, attention is necessary for explicit prioritization and smart rationing techniques in cases where need can’t be met. Explicit prioritization is necessary to continue to meet market expectations but also to improve market shares wherein competitors miss opportunities. This particular challenge isn’t new, although it’s also been underexposed in this specific problems and was often not part of preparatory pursuits.
Fourthly, the corona issues shows us that the monetary impact of a crisis additionally relies on the way cooperation in the chain is set up. It is usually unclear exactly how further costs (and benefits) are sent out in a chain, if at all.
Last but not least, relative to other purposeful departments, the businesses and supply chain capabilities are actually in the driving seat during a crisis. Product development and marketing and advertising activities have to go hand in deep hand with supply chain pursuits. Regardless of whether the corona pandemic will structurally change the basic discussions between logistics and generation on the one hand as well as marketing on the other, the future will have to explain to.
How is the Dutch meal supply chain coping throughout the corona crisis?