This summer has seen a period of unprecedented political and economic upheaval and the one thing we can be sure of in a rapidly-changing trading environment is that things are going to get more complicated before they get any easier.
As the great ship HMS Brexit trundles slowly down the slipway and into the choppy waters of the English Channel, FWD members are only just starting to face up to the impact of the separation from Europe. It looks certain that we, along with our customer businesses in retail and foodservice, will face three daunting challenges.
Losing a supply of European labour will hit the food industry hard. It’s estimated that about one third of people working in foodservice operations are European nationals, and between 100,000-200,000 retail workers. Should their right or indeed their willingness to work in the UK be compromised, our customers will find it very hard to fill that gap. Second, after years of food price deflation, we’re likely to see prices into wholesalers rise as the Pound weakens and tariffs come into force. We’re already aware of 20% increases in the price of imported fruit and nuts which will start to work through to consumers early next year.
Thirdly we will have the colossal task of detaching thousands of regulations and standards from the EU. Mrs May’s Great Repeal may buy some time here, but the job of repatriating 40 years’ worth of European influence has been at best described as challenging, and at worst, impossible.
Times of great change and uncertainty create opportunities, however. All the above, plus the impending arrival of Amazon and other online delivery models on our patch, mean this is the critical moment for us to pull together and review our more outdated practices. Wholesale has to learn to move faster than its competitors and its customers in anticipating consumers’ needs. Beyond the example being set by some brilliant pioneers, we are falling behind the curve in the adoption of online ordering and in efficiency of distribution. So now more than ever we need our industry to pull together and be frank about its weaknesses, and tackle them with its collective strength.
That’s why FWD is bringing wholesalers and suppliers together, as we have done in recent weeks at our top-to-top senior executive briefing, our seminar on marketing to wholesale customers, and the ongoing meetings of our Supplier Council. Together we are exploring how to attract and retain the best people, how we can understand our customers better, and how we can streamline our processes to take cost out of the supply chain.
We have identified specific needs which are crying out for collaboration. A central pool of product data to meet new food Information regulations. Standardisation in our processes for goods in to our depots and distribution centres. An alternative to the proliferation of new line forms which suppliers have to complete for each wholesaler. Compatible platforms for online ordering, reliable market reads and robust, freely available sales data.
FWD members’ businesses are in good health and the markets we serve are buoyant, but we would be fools to expect anything other than uncertainty and delayed investment as the country moves through Brexit and its aftermath. This is absolutely the moment to collectively address our productivity issues, to ensure that the food and drink wholesale sector comes out of the upheaval as strong and united as it is going in.
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