Chapter Six
Food Supply Chains
Business Resilience, Innovation, and Adaptation
Thomas Reardon and Rob Vos
Food supply chains were disrupted by pandemic restrictions, but modernizing trends accelerated and some supply chains were able to innovate quickly.
KEY FINDINGS
- The pandemic disrupted food supply chains through government-imposed lockdowns and restrictions, affecting labor supply, input provisioning, logistics, and distribution channels, and shifting consumer demand for food.
- Impacts differed by the degree of integration and modernization of food supply chains.
- “Transitioning” supply chains were the most vulnerable — these chains are long but still poorly integrated, face infrastructure limitations, and are dominated by small and medium enterprises (SMEs) that depend heavily on hired labor.
- Traditional supply chains also suffered but less so, being generally short and relying on family labor.
- Modern, integrated supply chains were better positioned to adapt and innovate. Businesses that were able to “pivot” or innovate rapidly fared well, using either their own capacity or intermediaries to expand e-platforms for supply and delivery.
- Ongoing trends, most notably the growth of supermarket-style retail, e-commerce, and food delivery, were accelerated by the pandemic.
- Recent innovations offer opportunities for SMEs in food supply chains. E-commerce jumped by 100 percent in middle-income countries, and specialized logistics intermediaries have innovated to meet the needs of both large food businesses and developing-country SMEs and smallholder farms.
KEY RECOMMENDATIONS
- Create a business environment that supports private sector firms in their central role in food system resilience and transformation.
- Promote food system modernization and innovations — driven by the private sector but enabled by the public sector — that enhance resilience and help generate employment and better livelihoods along food supply chains.
- Develop regulations that promote market integration and reduce transaction costs along supply chains.
- Invest in adequate basic infrastructure, ICT, and mobile networks to facilitate business and supply chain innovation and modernization, especially for SMEs.
- Focus government interventions on targeted support to improve market access and entry for SMEs.
Browse Chapters
Chapter One
Beyond the Pandemic
Chapter Two
Resilience
Chapter Three
Nutrition
Chapter Four
Natural Resources and Environment
Chapter Five
Toward Inclusive Food Systems
Chapter Six
Food Supply Chains
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