COVID-19 has created a huge impact on a global scale that led to an unprecedented worldwide economic disruption.
The impact of COVID-19 to distributors vary from the customers they are serving. For some (especially the essential goods), there is a highly increased demand and some goods have a significant decrease in demand. As an example of the scenario, grocery distributors are challenged to keep up with the unpredictable demand of the consumers while restaurant distributors do not have anyone to serve due to business closures. Since there is a continuous shift of demand, it is hard to predict the strategy in the inventory and procurement side which can develop a bullwhip effect due to cashflow issues, decreased liquidity of customers and supplier production stoppage.
The unpredictability of consumer and customer behavior should be a heads up to wholesale distribution companies to assess and address supply chain disruptions, and workforce constraints. It will be challenging to shift from traditional strategies to innovative ones abruptly because forecasting models in the past may not work for the current situation today.