In just a few short months, the COVID-19 pandemic has completely transformed the global economy, ushering in a new, if temporary, ‘business as usual’ for corporations and communities all over the world.
According to a recent report by Business Insider, a third of the world’s population is currently in some form of lockdown, with the movement of people actively restricted by local and national governments.[i] In many countries schools, office spaces, retail stores, theatres, pubs, clubs, and restaurants have been forced to close in a bid to control the spread of the virus and prevent healthcare systems from becoming overwhelmed.
The suddenness of the enforced lockdown has been a shock to global markets, forcing entire industries to close, and creating huge shifts in demand, as communities have adjusted to spending more time at home. Recent weeks have seen some affected organisations rapidly adapt production processes to meet the urgent needs of communities including ramping up production of essential food and beverages or pivoting business processes to fill gaps in demand for at-home services.
In this blog, we will take a look at how different sectors are managing their way through the crisis and shed a light on how Domino is lending a hand to help customers to adapt to ‘business as usual’.
Food and beverage
The COVID-19 pandemic has had a huge impact on food and beverage markets the world over. In early March, when the virus was first declared a pandemic by the World Health Organization (WHO), shoppers in markets including Europe and the US reacted to the possibility of quarantine by stocking up on food and essentials, putting considerable strain on supermarkets and food producers.
Around the world, demand for consumer packaged goods soared to unprecedented levels in March, increasing 10.9% in Italy, 9% in France, 8.2% in the UK and 9.5% in the US.[ii] A few months later, and food supply chains are slowly adjusting to the new normal, despite a drop in initial sales there has been a sustained increase in demand brought about by more people eating at home. In the UK, it is estimated that approximately 500 million more in-home meals have been consumed per week during the lockdown period.[iii]
There are certain items which seem to be more popular than others. In the UK, supermarkets, and wholesalers have struggled to keep up with the demand for flour – and the reason why is not a shortage in the foodstuff itself. The majority of the flour produced in the UK is packaged in bulk bags produced for wholesale to restaurants and bakeries. In response to the increase in demand, many UK mills have ramped up production in an attempt to fulfil orders for smaller bags, while some retailers, including Morrisons, have begun decanting bakery flour into smaller bags to sell in-store.
With supermarkets and wholesalers under pressure to keep shelves stocked, other food producers are feeling a very different effect at the hands of the pandemic – particularly those whose business models focus solely on supply to offices, schools, restaurants, bars, pubs, and cafés. In the first few weeks of lockdown farmers across Europe and the US were forced to throw away tonnes of fresh vegetables, eggs, and dairy products that they were unable to sell, owing to a sudden and sustained drop in all such businesses.
Food providers are nothing if not resilient, though, and so to make up for the loss in business, and take the pressure off supermarkets, several providers have decided to switch to direct-to-home orders – with some farms and producers providing home delivery services, or teaming up with restaurants to form temporary supermarkets.
In the UK, London-based deli and food delivery service Detox Kitchen has teamed up with its supplier to produce and distribute grocery boxes while fast-food chain Leon turned 65 of its UK restaurants into temporary supermarkets selling refrigerated ready meals. While in the US, family favourite Denny’s has begun selling staple groceries from 30 restaurants across Oregon and California.
Of course, when switching production channels coding and labelling of products and packaging is an essential step which cannot be overlooked. Suppliers of new services need to ensure that products comply with government and industry regulations, by printing the relevant batch, date, and traceability codes on their products and packaging.
Since the start of the COVID-19 pandemic, Domino has seen a significant global rise in demand for its printing equipment, inks, consumables, spares, and service support from manufacturers in key sectors. This includes food and beverage producers, who are working hard to ensure a consistent flow of essential product during these troubling times.
“Our biggest contribution has been keeping supply chains moving, and ensuring that we can continue to service customers working in key industries and supply them the service and support that they need to produce essential items during the current time. Our procurement teams are well-versed in managing long product life cycles, and our supply chain teams are used to navigating uncertain environments. While the current situation is unprecedented, it is not something that we are unprepared for.”
Rachel Hurst - Chief Operating Officer at Domino
Domino has been able to utilise its position as a global provider of printing equipment and materials, to continue supply to critical industries in all parts of the globe. By shifting the production of goods and the procurement of raw materials to different regions, Domino has been able to overcome restrictions on the movement of goods between countries, and better serve local markets.
This includes not just the production of printers and hardware, but also the inks and fluids required to keep printers, and therefore production lines, running. Domino is fortunate to have a network of inks plants across the globe, including the USA, China, and a recently opened large-scale production facility in Liverpool, UK.
“Ensuring that we can continue production of our inks and fluids is really critical for customers,” says Pete Weaver, Group Fluids Operations Director at Domino. “Without ink, they cannot continue production – and so a huge amount of work has gone in to ensure that disruption to the fluids supply chain is minimal.”
“We have started to utilise our fluids capabilities in China in order to better serve the Asia Pacific markets and take some of the pressure off of the team in Liverpool,” says Weaver. “And our procurement team has been working hard to continue the supply of raw materials, and source alternatives where necessary, in order to continue production in our plants around the world.”
Food and beverage producers are not the only ones having to adjust to the unprecedented switch in demand – many businesses in other sectors, including foodservice and hospitality, are also having to rethink their business models. In the next section, we take a look at how some restaurants are coping with the pandemic, and how Domino’s Digital printing partners are lending a hand.
RELATED: Domino Supports Vital Sectors in Current Crisis
Foodservice
Across the globe, restaurants and other foodservice outlets have been forced to temporarily close. For many top name brands, it is business as usual, with international chains including Shake Shack, Burger King, and Nando’s still open for business and offering take away and delivery services – either on site, or through online ordering platforms including Deliveroo, DoorDash, and Uber Eats.
For other foodservice providers who have previously operated without options for home delivery or takeaway, closing the doors to onsite diners has been much more of a blow. Yet, with more and more people eating at home, the demand for foodservice delivery has never been higher. In recent weeks, we have seen an increase in foodservice providers switching up their business models to offer takeaway and delivery services for the very first time.
In the UK, Crown Labels Mfg Co Ltd, self-adhesive label manufacturers based in Rotherham, experienced an increase in urgent requests for labels in the weeks following the government-sanctioned lockdown, with multiple companies placing orders that required fulfilment within just 24-48 hours. The company received, amongst others, several requests for high-quality, pre-printed, branded labels for takeaway food packaging from local restaurants that previously only catered for onsite diners.
“With eat-in restaurants forced to close, several foodservice providers have started offering takeaway and delivery services to keep things running while restrictions are in place, and meet local demand for foodservice delivery. For many businesses, this is completely new territory, and spreading brand awareness, and encouraging customer feedback is imperative. We have fulfilled several orders for packaging labels embedded with QR codes, to help encourage customers to share their experience, and promote services online.”
Tom Hardy - Managing Director at Crown Labels
The challenge is not unique to foodservice – Crown Labels also recently fulfilled an urgent order for City Grab, a new venture from Sheffield City Taxis, who have switched from transporting people to transporting takeaway food and produce from local shops directly to people’s homes. Crown Labels were instructed to produce labels to help City Grab to promote their brand on the packaging – a request that was fulfilled within just 24 hours utilising the N610i, Domino’s 6-colour UV inkjet digital label press.
In China, where transmission of the virus has now slowed, many schools and offices have started to reopen with different processes in place to limit the spread of infection. In many such locations, onsite foodservice options such as canteens and restaurants have remained closed, with only pre-packaged food made available to limit interaction.
In Xiamen, state owned-food company, and Domino customer Xiamen Gulong Food co. LTD (Gulong Food) has implemented an advanced production and distribution system, called ‘lunch 4.0’, to provide personalised meals for local school children. Data on each child’s meal choice is collected by the school and sent directly to Gulong Food to produce the customised meals. Upstream, the data is connected to a coding automation system run by Beijing Jiahua, which delivers data directly to a Domino Ax350i continuous inkjet printer for personalised coding.
Each lunchbox is coded with information including school name, meal type, class number, and student name, as well as expiration date and batch number. The personalised lunches are then delivered directly to each school via a shuttle bus run by Gulong Food. The whole process is flexible and efficient, with automated processing in place to limit the need for manual interaction, reducing human contact, and minimising the risk of infection.
With more people adjusting to life under lockdown, it’s not just foodservice providers that are experiencing changes in demand – online shopping, and in particular ecommerce from online providers including Amazon have had a significant boost in the past few months. In the next section, we will take a look at how ecommerce providers are adjusting to this increase in demand
Ecommerce
Online shopping, or ecommerce, is another market which has experienced a dramatic change in demand during the COVID-19 pandemic. Across Europe and the US, as lockdown measures have been introduced, consumer shopping behaviour has shifted as people have adjusted to spending more time inside their homes.
“In the US we have noticed an increase in customer requests brought about by the current coronavirus situation,” says Gary Peterson, Account Manager for Variable Data Solutions for Domino Digital printing. “While many companies have been forced to put capital investment on hold, several industries have experienced a dramatic increase in demand – this includes ecommerce.”
In March 2020, disposable gloves and bread machines topped the list of the 100 fastest growing categories in ecommerce in the US, up 670% and 652% respectively. With other, lockdown ‘essential’ items, including weight training equipment, computer monitors, craft kits, home hair colourants, and office desks also seeing a dramatic increase in demand.[iv]
“Many of our ecommerce customers use our K600i digital printing presses to produce pre-printed variable data labels for logistics, to enable products to be tracked throughout a company’s supply chain up until the point of delivery – and also to enable customers to return products,” says Peterson. “The number of people buying products online has increased dramatically, and our customers are now having to respond by producing more variable data labels. For some customers, this has meant investing in new technology to help keep up with the change in demand.”
The K600i is available as two separate solutions, a single bar option, capable of printing 75 metres of labels per minute, and a dual-bar option, which can double production capacity up to 150 metres per minute.
“The ecommerce market is volatile and will experience peaks in demand at certain times of the year – for example, Christmas. The dual bar K600i was designed to enable customers to respond to fluctuations in demand and increase production capacity when needed. Over the last few weeks, customers who have previously invested in a K600i dual bar have been able to ramp up production in order keep products moving through the supply chain, without having to purchase new technology.”
Gary Peterson - Account Manager for Variable Data Solutions for Domino Digital Printing
The digital flexibility that comes with a digital press system like the K600i system is an advantage for those organisations producing labels for the ecommerce market – as well as other sectors where variable data labelling is required.
Overcoming COVID-19
As the global efforts to overcome COVID-19 continue, it’s not just life at home that’s changing. While food and beverage manufacturers, at-home foodservice providers, and online retail services are rallying together to help communities adjust to life under lockdown, other organisations are lending a hand to support the work of key services, and frontline medical staff.
Over the last few months, communities around the world have witnessed a massive increase in the quantity of medical and healthcare provisions required to overcome the current pandemic. Items in high demand include ventilators to care for critically ill patients, COVID-19 test kits to track the spread to the virus, personal protective equipment for frontline staff, and sanitation products for use at home and in within essential services.
In Part 2 of this blog we will take a look at how some organisations are lending a hand to support global efforts to overcome COVID-19, and provide healthcare systems and communities with access to essential items.