CO2: the latest
How is the CO2 shortage continuing to impact the industry?
While it may have created huge headlines two weeks ago, talk of the CO2 crisis has quietened down as suppliers and wholesalers have their eyes firmly focused on providing essential supplies for customers.
For some, the shortage of CO2 has meant business as usual with some wholesalers reporting little to no impact, while for others the challenge facing the supply chain has been felt more acutely, leading to cancelled promotions, limited availability and empty shelves.
“We have seen a few suppliers impacted by recent shortages of CO2 at a time when they have seen high levels of demand and when they would otherwise have been building up stocks for the summer,” said Jim Gouldie, Supply Chain and Technical Services Director at Bidfood. “We have been closely monitoring the situation, and the majority have confirmed to us that they have now secured enough supplies to maintain production for the foreseeable future, although some are still experiencing short-term, sporadic issues on a few lines. We are continuing to work with these suppliers to ensure continuity of supply to customers.”
Jim Brown, Senior Trading Controller, Landmark Wholesale, reports a similar picture: “As a result of the CO2 crisis, we are discovering that most soft drinks suppliers are struggling to maintain a full service level, particularly Britvic. However, they have sensibly cancelled promotions to avoid customers loading up for profit when the weather is already driving great sales out which has limited us going off sales to customers.
“As CO2 supplies are returning to normal, suppliers are returning to full production. However, many have no stock cover left to cope with the summer sales peak so full availability main remain a challenge for a few more weeks.”
FWD Chief Executive James Bielby warned of his concerns for the wholesale channel back in June, saying: “Members are reporting that suppliers who are anticipating shortages of beer and carbonated drinks are rationing supply or even cancelling orders to meet their commitments to larger retailers.”
For Landmark, this hasn’t been the case, though Jim Brown admits that CO2 shortage may have been easier for the multiples to work around. “I would be very surprised and disappointed if suppliers are favouring the multiples over the wholesale channel, although of course, the multiples may benefit from having sophisticated internal supply chain solutions to ensure stock is available in all stores, whereas standalone wholesalers may have experienced more inconsistent availability,” he said.
While the gas shortage has mainly affected the production of soft and alcoholic drinks, it’s also being felt far wider. Allied Bakeries, which produces Kingsmill, has switched from modified atmosphere packing for its rolls and thins which will result in a ‘marginally reduced’ shelf life in order to maintain supply and meet customer demand. Last week, Hovis reported that it had reduced best-before dates in a similar effort to continue to supply products. Warburtons was also impacted and had to temporarily halt production of crumpets.
What’s been your experience of the CO2 crisis? Get in touch at wn@thebrightmediaagency.com
Bidfood CO2 FWD Landmark suppliers
