Question

Amidst the current pandemic, how can supermarkets adjust their supply chain/logistics strategies on groceries product categories such as trade-up/bulk items?

Answer 1

It shall be noted that amidst the current pandemic, supermarkets are kept open to facilitate day-to-day grocery product categories and respond quickly to panic-buying and other demand‐side shocks.

Due to changes buying patterns particularly focussing on the purchase of essential commodities, to avoid the risk of running out the stock, the focus on the resiliency of food supply chains have been emphasized.

The supermarkets assure customers there is plenty of supply and no need to hoard essentials.

The supermarkets ask people not to panic to see shelves empty. Stores and supply chains are catching up with increased demand. The supermarkets expanded their capacity of warehouses. The supermarket chains are slimming down product ranges so they can focus on essentials.

They have adopted the just‐in‐time approach to food retailing, which has been an important source of increased efficiencies in the sector, with relatively low stocks and continuous product flows. Transportation and distribution networks were strengthened. The long‐distance road and rail transportation networks were ensured well-functioned with the involvement of the government machinery. Even Low‐risk non‐compliance activities (i.e., not related to food safety) are temporarily suspended to allow a focus on key services. The truck drivers carrying food or animals are exempted from the 14‐day self‐isolation period otherwise required for individuals entering each country.

The supermarkets also entered into a contract with online delivery portals. This helped the manufacturers of the essential commodities to fill the emptying stock at supermarkets and ensure regular supply to meet the recent demand shock.

Online grocery delivery models encompass two main categories: dedicated online‐only services and existing grocery retailers with an online delivery option.

Food supply chains started sourcing from local suppliers of in‐season fresh produce, considered less vulnerable to cross‐border disruptions in imports or systemic failure at a major choke point within a larger supply chain. This is driven by the newly championed interest of consumers in “local foods” for several reasons including perceptions related to economic, social, environmental, and health benefits