Nestlé faces supply chain pressure amid reports of festive panic buying
As pandemic-hit logistics operations continue to impact on the UK’s retail landscape, the CEO of Nestlé has said the company’s Christmas confectionery supply chains could be affected, reports Neill Barston.
The ongoing HGV driver shortage affected a number of sectors in the past few months, exacerbated by Brexit trading complications and Covid-19, leading to national media reports of panic buying of product lines, with sweets and snacks traditionally high on the list of favourite seasonal items.
Confectionery Production has previously reported on supply chain pressures that has led to groups including Haribo being impacted by delivery issues, as well as restaurants and other retailers affected by a spike in demand and reduced access to supplies.
Speaking to the BBC, Nestle’s CEO Mark Schneider (below) explained the company was working hard to ensure deliveries ahead of Christmas, including its classic Quality Street ranges.
He said: “Like other businesses, we are seeing some labour shortages and transportation issues, but it’s our UK team’s top priority to work constructively with retailers to supply them.”
Furthermore, he noted that although the company was facing challenging conditions, he believed that the business was well placed to respond.
He added: “Like all businesses, we are managing a number of challenges at the moment, but we are working hard to mitigate those issues and are not seeing a material impact on supply. Our factory in Halifax manufactures up to 12 million Quality Street sweets every day, and there will be plenty to go around this Christmas.”
The wider situation across the UK’s food and drink sector was highlighted by National Union of Farmers (NFU) head Minette Batters, who has written to Prime Minister Boris Johnson warning that the food and farming sector ‘is on a knife edge’ due to a significant shortage of workers.
She has asked for a Covid Recovery Visa to enable companies to recruit from outside the UK – just nine months after Britain’s formal exit from the European trading bloc put an end to freedom of labour movement that has been relied upon in a wide range of industries.
Latest ONS figures have shown that 17% of adults had not been able to buy essential food items in the past two weeks, rising to 23% for non-essential goods, according to its latest research.
Speaking on the sector’s supply chain issues, Ian Wright, Chief Executive, Food and Drink Federation, expressed his concerns.
He said: “Businesses operating throughout the UK’s farm-to-fork food and drink supply chain are struggling due to a lack of available workers. For our members and the availability of manufactured products, in the absence of required short term measures from the Government to boost the supply of labour, much will depend on the resilience of individual company supply chains and on the behaviour of shoppers in stores. That means the outcome of what is and isn’t available at Christmas will be highly unpredictable.
“Given the continued problems throughout our industry due to shortages of HGV drivers, it may be that products aren’t in short supply and more that they can’t be effectively distributed to retailers. In communities that are located further away from distribution hubs, where a single lorry doesn’t show up at the local supermarket, that could mean hundreds of products aren’t available when people go in to do their Christmas shop.”