More than 20 businesses and organisations within the food sector have contributed to a white paper that claims that the Government has not done enough to support the UK’s food and drink industry from the ‘perfect storm’ created by Covid-19 and Brexit.
The Food and Drink Federation (FDF) were among the 20 bodies to support the white paper, along with businesses including: Campbells Meat; Kendal Nutricare; Mademoiselle Desserts; PDM Produce; Wensleydale Creamery; Anglesey Sea Salt Company; Synergy Flavours; The Cake Crew; OMSCO; and CSM Bakery Solutions.
All the businesses and organisations took part in a survey and series of roundtables, which revealed that 60% of businesses said they suffered a major impact on sales and forecasts during the first six months of 2020. 85% of companies also reported a knock-on effect on their cash flow and budgets.
The white paper concluded that seven out of ten businesses felt uncertain about the current state of the industry while 55% believed the UK Government was not supporting the industry enough.
Nicki Hunt, membership and commercial director of the FDF, said: “It’s been a tough year for food and drink manufacturers, what with the disruption of Covid-19 and the uncertainty we face as we head toward the end of the transition period. But businesses within the sector are adaptable and resilient, and have worked hard to keep the country fed.
“Those companies who supply the hospitality and out of home sectors have been hit particularly hard so we continue to push for further support and guidance to be extended to the wider supply chain.”
Frazer Durris, CEO at Businesswise Solutions, who formed the white paper alongside the FDF, said: “Companies linked to tourism and hospitality have seen demand fall off a cliff while those supplying retail have seen demand soar. The uncertainty caused by the pandemic has made forward planning difficult if not impossible.
“The sector desperately needs more support in the form of clarity from the Government. A number of the companies who spoke at our roundtables said they were holding back on investing in major sustainability projects until the picture becomes a bit clearer. This represents a big climate risk and one that can be avoided if the Government can provide more certainty to these businesses.”
Further comment
Steve Morgan, managing director of Synergy Flavours, was one of those to contribute to the white paper. He said: “We have the capacity to come through this crisis well enough but if we’re serious about being a globally facing trading nation we really need to up our game. Other national governments have significantly more effective support in place than is currently the case in the UK.”
The survey also revealed that many in the food and drink sector are equally concerned about the uncertainty over Brexit, with the transition period after the UK left the EU due to end this year with no sign of a trade deal being agreed.
Julia Wood, managing director at PDM Produce, said: “Realistically, our biggest challenge is Brexit and getting workers from Europe in the same capacity as we could in years gone by.
“We’ll have to adapt and the companies that do, will succeed; and the companies that don’t, won’t – I think that’s the bottom line to be honest.”
A total of 65% of those quizzed said they were ‘not feeling confident’ about how Brexit would impact their business with 35% saying they were ‘unsure, but hoping for the best’.
The overwhelming sentiment of the industry is that there has been a lack of information, clarity and direction which has caused uncertainty on a massive scale and prevented businesses from planning ahead or investing in major projects.
Richard Hampton, director of OMSCO, one of the UK’s largest, farmer-owned and run, organic dairy cooperative, said: “If you take a long view, big challenges will always arise and Covid is one of the most serious threats of the modern era – but we will recover from it, some sectors better than others.
“The frustration for me is the continued uncertainty on key issues such as Brexit. Give us certainty, give us line of sight and we’ll do the rest.” The Food and Drink Federation submitted more than 175 questions to the UK Government, specifically around how food and drink manufacturers should be preparing for the end of the transition period in December 2020.
