{"id":34287,"date":"2020-05-11T09:17:26","date_gmt":"2020-05-11T13:17:26","guid":{"rendered":"https:\/\/biznews.fiu.edu\/?p=34287"},"modified":"2020-05-13T13:49:57","modified_gmt":"2020-05-13T17:49:57","slug":"supply-chains-and-the-coronavirus-why-are-shelves-empty-insight-from-fiu-business","status":"publish","type":"post","link":"https:\/\/biznews.fiu.edu\/2020\/05\/supply-chains-and-the-coronavirus-why-are-shelves-empty-insight-from-fiu-business\/","title":{"rendered":"Supply chains and the coronavirus: why are shelves empty? Insight from FIU Business."},"content":{"rendered":"
\"Supply
Supply chains and the coronavirus: why are shelves empty? Insight from FIU Business.<\/figcaption><\/figure>\n

As U.S. shoppers, panicked by COVID-19, have stockpiled food, hand sanitizer, toilet paper, meats and other essentials, retailers are still unable to keep enough merchandise on their shelves.<\/p>\n

The coronavirus pandemic has strained supply chains like never before.<\/p>\n

\"Sebastian
Sebastian Garcia Dastugue<\/figcaption><\/figure>\n

\u201cThe excessively high demand at the retail level sucked up all the inventory available in the chain and created a vacuum,\u201d said Sebastian Garcia-Dastugue, assistant professor of marketing and logistics<\/a> at FIU Business. \u201cThat remains until the manufacturers fill the order and it starts moving to stores. In this case, they were adding products too slowly.\u201d<\/p>\n

In most cases, it\u2019s not a matter of product shortages, rather a consumer demand issue.<\/p>\n

\u201cIn the last few weeks what we\u2019ve seen is panic buying,\u201d said Garcia-Dastugue, who teaches global logistics and supply chain management. \u201cNothing in the grocery supply chain is designed to make products flow at the velocity customers are picking stuff off the shelves.\u201d<\/p>\n

The coronavirus pandemic, he noted, has two unique elements. It\u2019s a crisis that extends globally and it doesn\u2019t allow manufacturers or distributors to redirect resources to areas that need more assistance.<\/p>\n

In the case of a hurricane or a flood affecting Florida, which has a regional impact, companies can scale back distribution of products in other areas and increase it in the affected zones. \u201cNow you cannot do that because everyone in the world is going through the same situation,\u201d said Garcia-Dastugue.<\/p>\n

The grocery supply chain has also been hard hit by consumers doing more cooking at home due to restaurant closures and visiting supermarkets less, due to shelter-in-place orders.<\/p>\n

Garcia-Dastugue explained that in a supply chain, every component is in balance. Stores\u2019 demand is based on consumers\u2019 level of consumption. On the supply side, manufacturers deliver an established number of products to each retailer. If demand changes, it affects the whole process and creates spikes at different points making it impossible for some parts of the chain to respond.<\/p>\n

\u201cIn the case of the first weekend that affected South Florida, customers bought all the merchandise and the grocery stores had to replace double or triple the number of products,\u201d said Garcia-Dastugue. \u201cThousands of stores were in the same shape.\u201d<\/p>\n

No system is prepared to handle such a sudden increase in demand and that, he added, resulted in a bottleneck at the manufacturing level:<\/p>\n