Supply Chain facing Unique Challenges in COVID-19

The coronavirus pandemic has caused widespread disruption to supply chains since the end of January. This is mainly because of measures put in place by governments to stop the spread of the virus such as enforced lockdowns, which have led to delayed shipments and factory closures alongside lower demand for many goods and services.

However, this has not been the case for medical supplies. Over the last few months, the demand for Personal Protective Equipment (PPE) has increased dramatically around the world in order to protect health workers and those on the front line throughout the pandemic. Yet, this protective equipment has never been needed before in such capacities and is, therefore, not available in the sheer quantities needed. Even if it is available, reduced shipping, freight flights and passenger flights, which account for roughly 50% of freight moved by air, make it more difficult to move this PPE from the production location to where it is needed.

However, in order to try and prevent this shortage from becoming a problem, many global businesses have repurposed their supply chains in order to make and deliver PPE.

Here are just a few examples:

Ventilators

Due to the coronavirus attacking the lungs, many people, who end up needing hospital treatment after becoming ill with the virus, require breathing assistance through a ventilator. However, many countries only had a limited number of ventilators, so put a call out to businesses, who did not specialise in making ventilators, to start producing them.

As a result, in UK, the VentilatorChallengeUK was formed. The VentilatorChallengeUK is a consortium of significant UK industrial, technology and engineering businesses from across the aerospace, automotive and medical sectors who have delivered at least 10,000 new ventilators to the National Health Service (NHS) . These businesses include Rolls-Royce, Ford, Airbus and UK-based Formula 1 teams including McLaren.

The aim of the challenge is to create a supply chain from scratch to handle 3.2 million parts to build new ventilators. The operation will include the collection of parts from a new supplier base, as well as the handling, storage, order picking, kitting, and delivery to final manufacturing locations. DHL will manage the inbound supply chain for two workstreams of VentilatorChallengeUK. This will help speed up and increase manufacturing of approved ventilator designs.

Scrubs, Masks and Visors

Hospital scrubs as well as masks and visors are being needed in such sheer quantities that many businesses, who are not usually involved in these supply chains, have repurposed their supply chains to help either make or deliver these supplies.

For example, luxury handbag manufacturer Mulberry has mobilised its staff in its UK factory to make reusable scrubs for staff in the NHS. While at the same time, Airbus is making PPE to deliver to hospitals in Spain. The company has achieved this by repurposing some of its 3D printers to produce thousands of the visor frames that are a crucial component in protective facemasks.

On the other hand, H&M, the world’s second biggest fashion retailer, is using its vast supply network to not only make but also source PPE for hospitals in the European Union to help curb the spread of coronavirus. The company said it has offered the EU its help and was now trying to understand which needs are the most urgent while working out what its supply chain can offer. “The EU has asked us to share our purchasing operations and logistic capabilities in order to source supplies, but in this most urgent initial phase, we will donate the supplies” according to a H&M spokeswoman. 

Airbus is also helping deliver much needed PPE into Europe. One way the company is doing this is by using their logistics capabilities to fly millions of facemasks and thermometers from China into Europe. For example, in March, multiple Airbus flights transported millions of masks from China to the Airbus headquarters in France. These masks were then distributed throughout France and Spain with the company donating 70% of these masks to the French and Spanish Governments.

Hand Sanitizer

Hand sanitizer faced unprecedented demand when the coronavirus outbreak began. Not only were business trying to buy hand sanitizer and consumers were panic buying it yet at the same time, hospitals needed hand sanitizer but were unable to source it. This has consequently led to a shortage of hand sanitizer. To help combat this shortage some brewers have begun repurposing their brewing supply chains to make hand sanitizer.

 One of these is leading global brewer, AB InBev. The Budweiser brewer, which has been making beer for over 600 years, is working with its partners and distribution networks to both package and distribute disinfectant alcohol as well as transforming the alcohol into hand sanitizer.

The company is also donating over 1 million bottles of hand sanitizer and disinfectant to hospitals. The disinfectant alcohol has been produced using the surplus of alcohol generated when making alcohol-free beers. As a result, an extra 26,000 bottles of hand sanitizer are also being provided to pharmacies and front-line workers across Europe.

Closing Thoughts

When the pandemic ends and we go back to normality, the demand for PPE and other medical supplies will decrease and demand for other goods and services should rise again to ordinary levels. As a result, the businesses, which have converted their supply chains to produce or help deliver PPE, will go back to their ordinary routines and this amazing supply chain will disappear. Yet despite all that, it is incredible to see how global supply chains have converted and pulled together in a time of crisis.