Perspective can help us through hard times – Coral Rose
An eventful start to 2022 has left many wholesalers counting the pennies once more, but as FWD Chair Coral Rose points out – a healthy dose of perspective can make us all feel better about our situations
Sometimes it takes someone else’s suffering to put our own problems into perspective and remind us that when we use words like ‘crisis’ and ‘chaos’ to describe the issues affecting our working day, we’re a long way from either.
I don’t want to name names because I might miss someone out, but we should all stand and applaud the wholesalers and buying groups who immediately mobilised to send money, food stock and other vital supplies to the people of Ukraine. In some cases, they even volunteered their own trunkers and drivers to make the deliveries across Europe, or offered jobs to arriving refugees. Perhaps it’s an understanding of the logistics of distribution that has prompted such an outpouring of support or maybe it’s simply a profoundly human gesture of solidarity. Either way, to everyone who donated time, stock and cash, well done.
Applying some of that perspective to our own supply chain issues, we can draw a distinction between price increases and actual food shortages. The first are inevitable – energy, fuel, cooking oil, wheat, chicken and fish are all spiralling in cost – and no one is pretending that increase isn’t going to get passed on to customers and beyond. Wholesalers might be canny about how they do it, but they will do it.
Individual businesses will be doing whatever they can to reduce their energy costs, including wishing they had ordered solar panels for the warehouse roof a year ago, when you could still get hold of them and someone to fit them for you. Ultimately however, we are limited in how much energy we can take out of cold storage and distribution, and we don’t have the margin to absorb 500% inflation, so again, that cost goes down the line.
So it’s managing those cost increases and maintaining workable margins for all that will be taxing our greatest minds for the next few months. Meanwhile, FWD and other trade bodies in food production and distribution will be working behind the scenes to convince government that assistance will be needed to keep food affordable for the poorest families, and indeed to keep the price of eating out in the hospitality sector sufficiently attractive to prevent closures, redundancies and even more food insecurity.
In March, FWD organised three meetings of the Food and Drink Supply Chain All-Party Parliamentary Group of MPs, to discuss the impact of ongoing issues like the HGV driver shortage and immediate impacts of the war in Ukraine. This is an invaluable pipeline into the heart of Westminster. FWD also took officials from Defra, the government department with responsibility for food distribution, into Blakemore’s Bedford depot to give them insight on exactly how the sector is adapting to challenges from so many different directions.
In his Spring Statement, the Chancellor declined to extend the 12.5% VAT rate for hospitality which had been widely called for, although he did offer some business rates relief to that sector. We’re also seeing some positive movement in that area for wholesalers, with one FWD member in Essex reporting that their business rates liability for 2022/23 had been reduced to zero as a result of a successful Covid Additional Restrictions Fund (CARF) application.
That’s a positive we can cling to in these uncertain times and there are others; the sun is shining, Easter is on its way and summer beyond that, and there’s no doubt that those year-on-year comparisons are going to be looking a lot more like our 2019 forecasts than they have in the two years in between.
Back in 2020 when we talked about a new normal we assumed it would be different, but stable. What’s becoming apparent is that constant change and revision is actually what the New Normal looks like. And that’s not such a bad thing as it might sound, because If there’s one thing the wholesale sector is good at – and has proved time and again over the past two years – it’s coping with constant change.APPG Coral Rose Country Range Group FWD price rises Ukraine