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How coronavirus outbreak changes online groceries services and Food industry Globally

The novel coronavirus has knocked down global travel and tourism. However, many professionals believe that online groceries and the food industry can be the winner.

Undeniably, the travel industry is severely affected by social distancing policies in defeating the rapid spread of coronavirus pandemic. Even travel technology companies could not escape the crisis since the global industry is facing a predictable loss of 75 million jobs and US$ 2.1 trillion in value. In fact, tourism does require authentic experiences and interactions, which induce rapid infection via direct person-to-person contact.

Fortunately, food and grocery stuff are likely to not transmit the virus itself with a proper hygiene practice. According to North Carolina State University, there is no evidence given that food and the packages carry COVID-19 enough to infect the human body.

As the global economy suffers a new crisis in 2020, the essential commodities trading business, including food and groceries tends to be the “dark horse” in the global market. Take the UK as an example, food and grocery expense are predicted to remarkable increase by 7.1% instead of 1.2% as the previous prediction, while the retail volume of other products is forecasted to be negative growth during the pandemic. It is due to consumers have the incentive to buy more than they need at this moment.

The positive side of coronavirus economic impact

Countries, which built a robust network connecting suppliers, customers, and delivery, have more opportunities to recover after the coronavirus pandemic. Even in the difficult time of coronavirus, we can perceive the optimistic signs for food city delivery and online groceries.

Boosted Online Grocery delivery

In this decade, online groceries delivery tends to be the sector emerging dramatic booming. Recent data show that more and more people order online groceries as an impact of COVID19 outbreak.

According to American professionals, this trend can be a permanent shift worldwide. RBC Capital claims that Amazon will expectedly generate gross revenue of US$ 70 billion in 2023 for online groceries only, which is three-time higher than that data in 2019. Another survey conducted by 1,500 Americans claimed that roundly 42% of respondents choosing online purchasing.

A giant technology company- Uber is starting to provide on-demand grocery home delivery by a partnership. For the global market, Ubers are seeking vendors with groceries from France to Brazil. This tech firm aims to cut down the delivery time to roundly 30 minutes, especially for food products which include meat, fruit, and vegetable. Shortly, consumers in Paris, Spain, São Paulo, and the UK will experience this service lately in July 2020.

In term of grocery delivery mobile apps, top three popular in the US, namely Walmart, Instacart, and Shipt have witnessed a dramatic increase in the number of downloads with the growth rate of 160%, 218%, and 24%, respectively in both Google Play Store and Apple App Store.

Boosted Food delivery

In various countries in the EU and America, where the majority of people are living alone, the demand for meal prep for self-isolated consumers is on the rise. Several industry experts believe that it will not be a temporary trend.

JustEat and Uber Eats, the two popular on-demand food delivery apps have witnessed a significant increase in order volumes last month. In expectation, the UK food delivery sectors expectedly enjoy the total revenue of approximately US$ 5440 in 2020, which is 11% higher than the data last year.

Apart from the value, the market has seen the remarked growth in the number of users, which is roundly 10% increase compared with that number in 2019. This trend has been a result of the surge in numbers of remote workers as well as student learning online.

In general, it is time for digitalisation the whole industry. Capturing the need of the market, major companies have invested more effort to accelerate their software development projects, which support online services. In particular, the need for developing restaurant ordering software, grocery delivery software and on-demand delivery is on the rise.

Related article: Secret to build successful on-demand services apps

Coronavirus poses the challenges and fears in the food and beverage supply chain

Taking about COVID19, we cannot deny the adverse impact it poses in the global economy. Excluding software outsourcing companies, firms in all other industries are suffering from a series of complications related to food shortages, travel restriction, and international supply chain disruption. Unfortunately, it will likely get worse due to the spread of this epidemic in the EU and America.

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Supply chain disruption globally

Since international transportations are restricted due to the order of several countries to slow down or stop the spread of the disease, many retailers have faced the threat of food shortage.

In several parts of the world, the restriction of public movement poses a threat to the food supply chains, which raised doubt about the price spikes due to global shortages. In fact, millions of farmers cannot harvest and plant due to the social distancing policy.

Up to April 2020, trade cargo transported by air travel has significantly fallen by 55% compared with this volume before the pandemic. Additionally, the report claimed that China has a mighty power in the global supply chain industry, where major or operated manufacturing plants and airport hubs. Fortunately, China recently ends its lockdown of Wuhan and restart the economy.

Limitation of current reservation method and Food stockpiling

Obviously, food can be seen as short shelf-life products that need proper inventory control. Many companies said that their current storage is at capacity, leading to a limitation of storage availability. Since the import demand currently decreases due to Supply chain disruption, businesses are seemingly struggling with storing input materials for the continuous plant operation. Food and beverage companies’ owners said that they are seeking robust inventory management solutions for optimizing the capacity of warehouses.

Related article: Top IoT solution in Food and Beverage industry

As community panic, people worldwide have started purchasing more tinned and frozen food, causing a net loss in the long term for both consumers and retailers. In fact, this booming demand only remains in the short-term, leading to a drop in sales volume in the future.

Clearly, perishable food providers tend to be more vulnerable than longer life product owners. In the consumer context, the food reservation excessing the real demand induces the massive waste, that they will shortly throw the product away.

Final words, we do understand the intricate perspective of global business recently. It is better to look at the optimistic side of this situation. In the meantime, we are looking for the rehabilitation of delivery business in both grocery services and the Food industry.

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