Darren Goldney column: Proceed with caution
It would appear the UK is slowly but surely reopening. While this is great news for the economy, there’s a very real concern for foodservice and on-trade wholesalers. Our sector needs sufficient notice to overcome the logistical challenges posed by a nationwide reopening.
For on-trade venues, they’ll need time to empty cellars before restocking – a task that can’t be done overnight. Suppliers also have production and supply chains with lead times to consider.
It’s critical we have clarity on what assistance and support there will be for those businesses affected by a slow recovery, including wholesalers. Without support, there is little incentive for a loss-making outlet to reopen and then supplier forecasts, or indeed wholesaler forecasts, could be wholly wrong.
As venues open up with social-distancing measures in place, takings will be down throughout the supply chain, yet costs will remain the same. There’s also the risk that when furlough ends that costs spiral. A gradual sales build needs support, for both outlets and wholesalers, that the government could then reduce over time.
Wholesalers can reopen and many have stock they are desperate to shift, but both the timings of allowable openings and the support for outlets will dictate how many will reopen at all. It’s from this that we’ll get a sense of volume and products needed.
As schools go back with phased classes and reduced pupil numbers, this poses a challenge for wholesalers given the reduced demand. Smaller drop sizes may mean wholesalers struggle to make suppliers’ minimum order quantities.
There are also still supplier shortages and this must be addressed as in some areas availability is about 20% worse on average than normal and with some suppliers, a lot lower than that.
What is a very bitter pill to swallow is the glaring lack of support. We have called for help time and time again. Foodservice and on-trade wholesalers remain confused, frustrated and angry that their financial plight has been ignored when their own customer base has received support in the form of grants and business-rate holidays.
Multiple retailers and independent retailers, many of whom have seen significant sale growth during the crisis, have received rate relief and many have had grants, while wholesalers who are severely impacted have received nothing.
Instead, wholesalers have been encouraged to take out coronavirus business interruption loans. On recent calls with government, they seem keen to push loans but don’t acknowledge the very real difference between lending money and giving proper support. The last thing wholesalers need without a robust opening plan is to be saddled with further debt.
At the heart of the issue is a fundamental lack of understanding of wholesale, which meant the key parts servicing foodservice and on trade, whose customers received support, received nothing meaningful themselves.
They have then had to watch food retail and many other industries get significant support that, arguably, they did not need.coronavirus covid-19 Darren Goldney Foodservice retail Unitas Wholesale wholesaler