The resurgence of COVID-19 across Australia in recent months has posed a familiar challenge for the nation’s food supply chains. Business has been disrupted again as new hotspots emerge by the week, such as the rapidly rising case count in Melbourne that has led to Stage 4 lockdown restrictions and a ‘state of disaster’ warning statewide. These pandemic-related lockdowns tend to spark consumer panic buying and infrequent shopping trips that drive extreme demand volatility down the supply chain, impeding cohesive collaboration between suppliers, buyers and transporters.
From discounted groceries and household items to daily vitamins and other health supplements, the Australian population relies on food retail supply chains as a means for everyday survival. Therefore, in response, retailers have shifted their focus toward supply chain resilience to ensure that these essential items still reach residents amid severely limited consumer access.
A Localised Approach
During the first wave, retailers learned that supply chain resilience could not be accomplished without significant adjustments. As border closings disrupt international trade once again, retailers have pivoted away from previous supply chain models that were heavily reliant upon overseas imports. Instead, there has been a shift to localised “micro supply chains” that move distribution centres closer to buyers to eliminate over-dependence on externally sourced goods. In turn, retailers can streamline distribution of popular consumer products to support supermarkets in maintaining optimal inventory levels.
Flexibility for Inconsistent Demand
In reality, certain goods are simply not suitable for domestic mass production. As such, the Australian government has provided assistance for food retailers through the International Freight Assistance Mechanism, which allows for continued access to key markets like China, Japan and the Middle East so that Australian retailers can still obtain high-value exports (seafood, meat, dairy and horticulture). However, those goods are only available on inconsistent schedules and in lower volumes — all of which require increased supply chain flexibility and agility through demand sensing. To navigate the second wave, adopting flexible supply chain processes like changes in operating hours, increased truck access, expanded loading times, and extra drivers is a necessity.
Leveraging Digitisation
Above all, the pandemic has revealed the nuanced nature of the supply chain and the complexities that correlate with effectively moving sustainable food products from farm to store. With the combined use of innovative technology solutions like blockchain, RFID and prescriptive analytics, supply chains can be optimised to lessen the damage of future disruptions through identifying and routing specific actionable insights that flag issues and provide direction on how to efficiently alleviate them by notifying the right person at the right time.
Blockchain is a public digital ledger that monitors, records and reports the movement of goods throughout the supply chain — similar to the contact tracing done by Australia’s COVIDSafe app. Products are scanned at various points along their journey from farm to store, so retailers can have enhanced visibility into where products have been, how far they have come and how long they were stored during each stop along the way. RFID labels are barcodes (typically on cartons, as tagging of individual products is not cost-effective) that contain product information, giving retailers immediate access to a detailed database highlighting inventory levels, demand trends and food quality. Finally, prescriptive analytics solutions provide actionable insights into gathered blockchain and RFID data to identify areas that need improvement. By leveraging the trio in unison, retailers have the means to easily understand why disruptions occur and expedite their response time with a set of clear directives.
Applying lessons learned from the first series of lockdowns will be critical for Australian retailers to develop supply chain resilience for navigating the pandemic’s uncertain future. The use of advanced technology for supply chain resilience and execution can help retailers find flexible solutions to complex challenges.
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