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Viewpoint: The Brexit lesson – prepare to fail

18 January 2019 by
Viewpoint: The Brexit lesson – prepare to fail

Take a long, hard look at your supply chain and make sure you're ready to meet any harmful effects from Brexit head on, says Hannah Kirton

There may be trouble ahead. Whatever happens with Brexit in the coming months, it's not only employment that's an issue. Uncertainty around trade agreements and import tariffs means businesses relying on food imports are looking at a potentially serious impact on their supply chains.

The UK imports more than £10b of fruit and vegetables, more than £6b of meat and more than £5b of beverages a year, so the scale of the challenge for the economy as a whole and specifically for the hospitality industry is enormous.

The latest reports suggest import barriers and a drop in the value of sterling could see significant rises in the cost of imported produce, of up to 40%. However, the smartest caterers and foodservice companies are confident about meeting this challenge and are putting action plans in place right now to ensure their supply chains remain competitive and their menus affordable to price-conscious customers. The Brexit uncertainty could also be an opportunity for companies to make sure their supply chain is ethical and sustainable, and always appealing to customers.

According to Tracey Jones, director of food business at Compassion in World Farming: "Developing longer-term contracts with suppliers committing to work with you to deliver higher-welfare meat, dairy and eggs with a UK provenance - two important aspects for the UK consumer - presents the greatest opportunity to secure customer confidence and loyalty in these uncertain trading times linked to Brexit."

Now's the time to make sure your business is in the strongest possible position to cope with any potential impact. Are you aware of the entirety of your supply chain and the impact of the tariff changes on your business? If you want to remain competitive, you need to do a deep dive into your supply chain, look at how it will be affected and draw up a contingency plan. You may need not use it, but the safety net needs to be in place.

So what's the best course of action right now? I'd suggest a product sourcing audit and analysis, followed by writing a clear action plan with timescales and quantification of the financial impact.

Yes, there may be trouble ahead for the catering and hospitality industry, but with some informed forward planning you can minimise the impact on your business, and even gain a competitive edge. Because every challenge is also an opportunity.

Hannah Kirton is a food and beverage procurement specialist at Procure 4

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