Ways to Overcome FMCG Supply Chain Disruptions during COVID-19

 

Disruption of the supply chain is defined as a major breakdown in a supply chain's production or distribution, including events such as fire, machine failure, natural disasters, quality problems, and an unexpected increase in capacity. This will lead to lower competitiveness, higher wages, growing market frustration, and more.

The financial markets have been crippled by the COVID-19 crisis, one of the most impacted participants are in the FMCG sector, which is the fourth largest sector in the national economy. It consists of three main segments: food and drinks (19%); healthcare (31%) and household and personal care (50%). In the 2017-2018 financial year, the industry rose from 2,20,852.4 crore rupees ($31.6billion) in 2011 to 3,68,669.75 crore rupees ($52.75billion). It was also expected to rise to hit 7,24,759.3 crore rupees ($103.7 billion) by 2020 at a Compound Annual Growth Rate (CAGR) of 27.86 percent. That's 9-10 percent of 2020 expansion.

COVID-19, however, has had a tremendous effect on this sustained rise in FMCG goods, lowering the demand and supply ratio; lowering the supply chain and logistics level in raw material dealers; and linear delivery and low growth forecasts.

The cause for instability of the supply chain is impulse shopping, strong demand, reduced movement, labor scarcity, inventory management. I.e., shortage of public transit, full lockout contributed to reduced supply chain workers' movement. At the same time, India was also witness to a huge influx of migrant workers travelling across the country on foot. Experts at FMCG claim most enterprises have 30-60 days of inventory of finished products. For corporations, panic buying has made it impossible to sustain inventories and control supply chains. In addition, locking down has exacerbated production as well as supply chain delays. This instability of the supply chain allows the supplies at the back of the stores to dry up.

By applying automation and robotics to make their supply chain more autonomous and by bringing vendors to their home markets to ensure sales continuity, this supply chain disruption can be overcome. Hostel Facility for staff inside factory facilities so that they do not have to think about going back and then returning to work with free meals every day. The chance of catching the virus will also be minimized by this measure. Organizations should, among other precautions, warn their workers about the effects of COVID-19, social distancing, the use of masks and sanitizing factories and transport vehicles. To preserve social isolation, Amul set up a provisional washbasin and put yellow tapes around their warehouse. More than a dozen consumer goods firms have begun supplying brands directly to clients, including Hindustan Unilever, ITC, Mondelez, Procter & Gamble, Dabur and Colgate. In order to track workers access and alternative delivery solutions, businesses can engage in third party logistics. The third-party logistics app can provide them with real-time updates on the supply of manpower that can be used for multiple job shifts.