Global supply networks have been disrupted by the COVID-19 epidemic, resulting in product shortages, shipping delays, production disruptions, and skyrocketing consumer prices that are escalating worries about chronically rising inflation.
Changes in supply and demand lead to bottlenecks in the entire global manufacturing and transportation chain. COVID- 19 health rules have led to plant closures across the globe and a labour scarcity in important transportation hubs including ports on the West Coast of the United States and China.
The majority of these products are made in Asia and transported to Canada and the United States via container ships. The enormous demand for container shipping has increased transportation costs and constrained ports’ ability to handle inbound cargo.
Further inland, trucking companies and warehouses are struggling with their own labour shortages while attempting to manage the huge flood of container cargoes.
Delays and shortages have thrown off manufacturing supply chains that were based on just-in-time delivery of components.
The latest COVID-19 variety has left grocery operators here and elsewhere racing to resupply shelves while agricultural, haulage and other crucial businesses struggle with significant labour shortages. Dozens of companies in China shut down in the pandemic, leading to a shortfall of packaged materials. A supply chain already under stress from 22 months of epidemic conditions has been made worse by that.
The whole supply chain, not just the food industry, was impacted by bottlenecks and cost increases, according to Sylvie Cloutier, president of the Conseil de la transformation alimentaire du Québec. “Whether you’re talking about fruits, vegetables, spices, or even packaging, everything that is imported and involves labour and transportation is moving slowly. The supply chain is intact, but there are obviously significant slowdowns.”
Extreme flooding in British Columbia in November in Canada made these problems worse by destroying roads and railways and virtually closing off the Port of Vancouver from the rest of the nation.
Development
The “supply chain management” in the Canadian retail industry, especially the grocery sector faced massive disruption during the Covid-19 global pandemic. In 2020, the sudden surge of the Covid-19 pandemic, home isolation, food scarcity, and consumer panic led the grocery demand very high. Within a week, retail grocery records administered a 40% sales hike in Canada. This sudden demand made the “supply chain” face challenges regarding worker shortage, disruptive cost structure, and limited production. The Canadian grocery retail stores, such as – Costco, Walmart, and Dollarama experienced 19% more demand than the previous years. Various grocery retail sectors deal with “100% farm fresh” food and dairy products, therefore, the suddenly high consumer demand disrupted the grocery supply chain excessively. Many grocery-shopping stores in Ontario and Montreal started shutting down amidst the Covid-19 pandemic. As per the article, WHO’s recommendations for Covid safety are associated with making workers trained in solving “supply chain disruption” in Canada.
In addition, excessive demand for grocery retails for Canadians created a need for more store additions per consumer demand. Initially, the number was 15,193 stores in Canada; however, it increased up to 26,526 stores to mitigate the supply chain effectively. Canada’s high product demands, such as – 2.3% of vegetables, 22.2% of edible oils, and 6.2% of poultry products are some immediate necessities in the Covid-19 situation. The RSM or “Regional Sales Manager” of Canada required vaccinated workers to uninterrupted supply chain maintenance. As per Canada’s economic condition, the supply chain faced disruption up to 1.5% in 2020; however, it developed a 4.5% hike by 2021 with a good workforce. In the Covid-19 situation, Canada’s supply chain required a skilled workforce with Covid safety protocols and vaccinated employees. Therefore, during the emergency before the national vaccination drive in Canada, the grocery supply chain faced severe damage. Thus, the recent article focuses on different scopes to mitigate “supply chain disruption” effectively in Canada’s retail industry.
There has been a recent report from resilience 360 which stated regarding the closure of manufacturing plants, the change in the behaviour of the consumers along with a massive increase in the prices has put a huge impact on Food and Beverage supply chains, in the short run but doubted to grow out in the long-run as well. This mainly happened as Food and Beverage producers were unaware of the labour shortages that hit during COVID-19, followed by a lack of preparation for the shutdowns and exposure to the virus. Practising social distancing also had a great impact on labour shortages which also limited production and had a great impact on the supply. Also, these shortages were not only in the production sector but also led to wastage of food and inefficiencies due to a decreased demand from the restaurant industry. The most affected portion of these shortages and wastage is the Food and Beverage industry.
The use of single-use packaged items has increased which benefits the plastic suppliers as there has been increased reliance of the companies and the industries on the packaging solutions for the distribution of their goods which has a little impact on financial implications but a major one on the sustainability
There has been a rise in the domestic production due to limiting of the export policies due to COVID-19.
Solutions-
The solution government, companies came up with to improve the transportation for grocery retail industry to mandate the vaccination for all the truck drivers who were entering Canada through the US border. The Canadian truckers who were not vaccinated were required to do mandatory quarantine for up to two weeks. The grocery is the main source for all the people living in Canada and through this ease between transporting grocery items has been improved.
Another thing the retailers came up with, to improve the relationship between manufacturers, grocery retailers and customers to establish online shopping for groceries. In the pandemic providing online grocery was turned out to be the main factor to reduce the crowd and fear of the customer visiting the store. To improve this, they introduced delight to the customer whenever any customers needed to know about the product as this nearby retailer would help them by visiting the customer’s location or through online meetings to reduce the doubts of customers about the information of the product. Thereby, through this groceries were easily accessible to the customers and the drop between the sales of groceries reduced by a high extent.
In addition, various big retailers such as Costco, Walmart and even more were taking help by chartering their own vessels which provide groceries and basic items through oceans from other parts of the world. Furthermore, planes were also considered to fill the stocks for holidays. This idea faced a little bit of a problem as this was time-consuming. Furthermore, grocery items were also stuck at the port and again clearance was time-consuming for this. Through this shopper got their products on sale but the sale was not the same as in the earlier years.
There has been a discussion on the industry’s higher reliance on manual labour which shifts the focus towards prioritizing the use of automation and technology.
For the coronavirus aid package the government also provided funding to the agriculture sector and to help the production sector. The main aim of the aid was the produce sector, which included $77 million for food processors to ensure the safety of the workers. For the cattle and hog producers, $ 125 million were contributed by the government along with supporting the food purchasing program through a contribution of $ 50 million.
Therefore, these were the solutions taken by the retailers and the Government for the customers.