Setbacks to IoT Implementation in the Function of FMCG Supply Chain Sustainability during COVID-19 Pandemic

Jelena Končar,Sonja Vučenović,Aleksandar Grubor,Radenko Marić,Goran Vukmirović

doi:10.3390/su12187391

Jelena Končar, Sonja Vučenović + Show 3 more

Open Access

https://doi.org/10.3390/su12187391

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Journal: Sustainability	Publication Date: Sep 9, 2020
Citations: 55	License type: CC BY 4.0

Affiliation: University of Novi Sad

Abstract

One of the basic measures of the World Health Organization (WHO) in the fight against the COVID-19 pandemic is a lockdown policy with reduced contacts and physical distance. This presents a challenge, especially for fast-moving-consumer-goods (FMCG) supply chains, which are characterized by a large number of physical contacts between employees in production, physical distribution, wholesale, and retail. One of the ways to comply with the prescribed measures with the smooth functioning of the supply chain is the complete digitalization and automation of all business activities and operations based on the application of the Internet of Things (IoT). In this regard, this paper aims to analyze the setbacks to the digitalization of business processes and the sustainability of the FMCG supply chain based on the implementation of IoT. The research has been conducted among the participants in the standardization chain in the sectors of production, physical distribution, wholesale, and retail of FMCG in the Western Balkans region during the COVID-19 pandemic. The results showed significant differences between business sectors in terms of the intensity of setbacks to successful IoT implementation. Based on the obtained results, a set of measures and incentives was proposed that the competent institutions and the management of the FMCG supply chain should apply to encourage the digitalization process. Suggestions for future research are given in the paper.

Highlights

The global pandemic caused by the SARS-Cov-2 virus, named COVID-19 [1,2] was declared on 11 March 2020, by the World Health Organization (WHO)
The biggest obstacle to the process of digitalization of the FMCG supply chain in the Western Balkans (WB) region is the lack of financial resources and high initial costs of Internet of Things (IoT) implementation (M = 4.21)
Observed individually by participants in the FMCG supply chain, the biggest obstacle for producers and wholesalers is the lack of financial resources (M = 4.41; M = 4.11), for participants in physical distribution, it is data privacy (M = 4.23), while retailers see problems related to the analysis and processing of collected data (M = 4.21) as the biggest challenge for the implementation of IoT

Summary

Introduction

The global pandemic caused by the SARS-Cov-2 virus, named COVID-19 [1,2] was declared on 11 March 2020, by the World Health Organization (WHO). As a result of such a continuous growth trend, in 134 days from the beginning of the pandemic, the number of infected people increased from 126,215 to as many as 15,955,925 (24 July), while the total number of registered cases of coronavirus was recorded in 213 countries [5]. Recent studies [7,8] point out that as a result of anti-pandemic measures, long-term market shocks, sudden changes in behavior patterns, and significant fluctuations in demand, have caused problems in the functioning of supply chains, especially the consumer goods chains (FMCG). The efficiency, transparency, and sustainability of the FMCG supply chain are being questioned, because the lockdown policy as a basic measure against the COVID-19 pandemic, which was chosen by almost all European countries, affects the movement of people, business operations and leads to unnecessary (panic) stocking [9]. One of the ways to gradually digitalize the FMCG supply chain is the implementation of the Internet of Things (IoT) platform [12]

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