Hospital supply to fail “within weeks”
Regional distributors of food for hospitals, care homes and emergency service providers say they need immediate government intervention to fulfil contracts, as their businesses are devastated by the closure of restaurants, pubs and cafes.
With no cash flowing into their businesses and product suppliers demanding payment, they are unable to pay staff to maintain food supply to the sick and vulnerable.
Wholesalers who provide food and drink to both public and private sectors have seen their sales devastated by the closure of the hospitality businesses that they supply. Many of these customers have six-to-eight weeks of unpaid debts for stock purchased from their wholesalers. Deliveries to schools have also stopped.
Coral Rose, MD of Country Range, a group of 12 regional wholesalers, says supply chains are “within weeks” of breaking down.
“We’re feeding front-line staff who are caring for the sick and elderly, as well as vital emergency service personnel, but we can’t do it for much longer,” said Rose.
“Just within our group, we supply more than 5,000 care homes, which is more than 100,000 vulnerable people. That’s not just the elderly, but hospices and homes for children. We’re getting calls from care homes who have been let down by their current supply chain and are relying on our members to be there to deliver them the food they need to feed their residents.
“We also deliver to more than 100 sites for front-line staff including hospitals, police and fire stations – they need feeding too.
“Across the country there are small distribution businesses like ours facing permanent closure without immediate support. We need grants not loans and we need them now.”
The wholesalers warn that the package of loans and wage support introduced by the Chancellor will not keep them in business, as they operate on very slim margins and have high overheads including storage, refrigeration and vehicle costs.
They fear that loans to their SME customers will not be used to pay for the stock they have already received.
“We need government to protect the supply chain to the most vulnerable people in our society,” says James Bielby, Chief Executive of FWD.
“Foodservice distributors have seen their market disappear overnight.”
That’s a feeling echoed across the foodservice industry, with FWD’s membership – that supplies and supports 350,ooo catering businesses as well as essential private-sector services – all flagging up similar issues.
Philip De Ternant, MD of Country Range Group member Creed Foodservice added: “The government still isn’t recognising that businesses like ours have got debt from January and February on the basis of the government closing down all the hospitality establishments. They’re now closed and not paying us.
“We haven’t paid the suppliers yet, that’s coming at the end of this month, but we’ve got all these customers that are closed saying ‘sorry I may not be here, so there’s no way I can pay you’. We don’t have that money, but we’ve still got all our ongoing costs.”
“We need grants to keep the wheels and the cash moving, so we can continue buying and our suppliers can keep stocking us with the essentials.”Coral Rose coronavirus Country Range Group covid-19 Creed Foodservice Foodservice FWD James Bielby Philip de Ternant wholesale