Easter Sunday bombings expose stresses in Sri Lanka retail supply chains

ECONOMYNEXT – Sri Lanka’s supermarket supply chains are under stress after the Easter Sunday bombings with labour shortages and enhanced security measures disrupting work and deliveries, top officials said.

"The bottom line is, this is a much unexpected situation and none of us were ready for the consequences," Gayani De Alwis, chairperson of the Chartered Institute of Logistics and Transport, said.

“You can’t plan for all eventualities mainly because it is a very unusual situation.”

Perishables such as fruit, vegetables, and meat were in short supply at many supermarkets.

Big companies have or are supposed to have disaster preparedness plans to ensure business continues in the face of shocks like natural or man-made disasters but the bombings and their timing appear to have overwhelmed their preparations.

De Alwis said that many grocery stores and local markets which account for 80 percent of perishable supplies to Sri Lankans were closed due to security concerns.

“After this unexpected situation took place, only the supermarkets were open as most local grocery stores were closed," she said.

"Thereby, it led to a perfectly normal shortage in supply because of the increased demand as people shopped more than what they generally do from these supermarkets," De Alwis said.

"Items like fresh produce were seen in very low quantities because generally, all supermarkets do not buy them in bulk in order to ensure freshness and quality."

"So, it is obvious that they fly off the shelf at an even fast rate.”

Curfews and security checks implemented after the bombings disrupted supplies to supermarkets, she said.

“Personally, I think this problem was worsened with the fact that these attacks happened soon after the New Year holidays where almost all employees in the country were away in their hometowns," De Alwis said.

"Then they did not return to work until the situation became somewhat stable."

"With no people to work, operations had to be halted and a steady flow was not maintained."

Supermarkets are geared more towards the modern trade, such as fast moving consumer goods.

De Alwis said that some multinationals which supplied such goods directly delivered stocks to retail outlets, bearing higher costs, rather than face delays at regional distribution centres.

Meanwhile, Laugfs Supermarkets (Pvt) Ltd. Chief Executive Murad Rahimdeen said consumption was seen falling after the bombings.

“Usually soon after the New Year, the supply chain becomes normal after a day or two, but this time it was adversely affected in moderation and there was a slight decrease in sales too," he said. (Colombo/May07/2019-SB)

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