Food Supply Chain Disruption: Challenges And Learning For the F&B Sector
There is a long way to go for the food and beverages sector to understand the impact, learn from these times and be prepared for the future.
As India wrestles through some unexpected times, the Coronavirus pandemic has left a perpetual impact on businesses including the food supply chains. The government has enacted measures to mitigate the impact of the accelerating pandemic and some bold initiatives have been taken along the way to curtail the impact on the food supply chain and its inadvertent impact on communities. But there is still a long way to go for the food and beverages sector to understand the impact, learn from these times and be prepared for the future.
While trying to protect the interest of communities and working towards monitoring their health and well-being and ensuring a steady food supply chain, disruptions which include hampering the movement of agricultural and food industry workers, delivery of essentials and inter-state border restrictions have caused delays and resulted in the spoilage of perishables, thus contributing to increase in food waste. There has been no concrete evidence that links the spread of COVID-19 to food consumption but in this need of the hour, a healthy diet not only reduces the risk of catching COVID-19 it becomes critical in keeping immune systems strengthened for an individual.
Companies across the food supply chain in the country are running around the clock to manufacture, ship and deliver food. On-ground support from the government, local administration and other state authorities is critically important for the functioning of the workers in the food supply chain and allow the companies to continue to operate in a hassle-free environment. The biggest misconception that manufacturers, retailers and government is trying to address is that there is shortage of food. Empty shelves, out-of-stock signs at retail shops are a cause of concern for customers but stock replenishment has been a key component of the food supply chain to dispel rumours. Awareness levels must be enhanced among customers to make purchases that are necessary and resist the temptation to hoard food as it becomes a major deterrent to the food supply chain situation in the country.
Perishables such as meat, poultry, eggs and dairy have witnessed an increased demand along with other frozen foods as these products can be frozen for longer durations. The meat and seafood retail sector has been affected to varying degrees with some retailers experiencing rapid demand for products as panic buying intensifies across the country, but simultaneously domestic food producers have witnessed rapid decline in demand from the food delivery service companies, restaurants, hotels and cafes due to the lockdown.
Shortage of labor, reduced demand for exports, increased market access complexity and longer procurement schedules due to lowered availability of transport, logistics and other travel restrictions have created a negative impact on the food supply chains. Amid COVID-19 lockdowns, all efforts must be made to ensure that food supply chains are disruption-proof in order to avoid food shortage. For companies, it is vital that their food producers and food workers at processing and retail levels are protected to minimize the spread of the disease within the sector.
Social distancing norms are creating a shift in consumption and behaviour patterns. The sector in short-term will witness retail-oriented products get consumed more quickly. The industry is working to address these changes and based their business models, production and distribution to more retail-oriented products. Companies in order to mitigate the impact on food supply chains need to address few critical areas which include assess changes in demand from customers and alter production accordingly, inform customers and other key stakeholders about changes being brought to the supply chains and the impact of the same in the future, upkeep the interest of the employees and have a consistent channel of communication with vendors, distributors, producers among others and monitor the risks internally as well as externally and revise their business continuity plans accordingly.