I want to highlight the successes of our great Scottish food and drink industry during these difficult times. Scotland’s producers and manufacturers have shown great resilience throughout the Covid-19 crisis. Our food and drink businesses have had to deal with many challenges but have responded positively by finding new ways of working and creating new opportunities to keep their businesses a float and to feed the people of Scotland.
One of the key challenges has been fluctuations in the demand for food and drink in local shops and supermarkets. This went from increased buying in the early days of the crisis – creating increased demand – to reduced purchasing on supermarket shelves as people used up their stockpiles!
Companies had to be nimble, often moving workers into different roles to support the production line and the packaging of their products, at the same time as ensuring social distancing to keep people safe. I have heard story after story of the shared approach and camaraderie in businesses as everyone has had to adapt quickly to the new circumstances.
Across the country firms have made the most of the opportunity to sell their much-loved products directly to customers online – a first for many! Businesses I have talked to see this as something they want to continue even after lockdown eases.
Other companies have seen a shift in their business to business sales. For instance, one of our members who supplies ingredients, packaging and machinery to the food industry, saw their business to suppliers for food service, hospitality, and education cease overnight. But they had a huge increase in demand for retail including a number of small butchers – many of whom have risen to the challenge to supply their local community during this difficult time.
Of course, it is our producers who supply the hospitality sector that have been hardest hit. While some have seen a surge in demand from retailers which has been helpful, others have not been able move their products at all. That is why the move to start the opening up of restaurants, bars and cafes is great news and will help our manufacturers selling into this sector to recover. That said, I think it is far too early to understand the long-term impact on the hospitality sector. Some restaurants have already been forced to close and others are holding off reopening until they understand how people will come back to the restaurant sector. We hope they come back quickly, and safely and hopefully Chancellor Sunak’s measures to support the sector make a positive difference.
In Scotland, we are working with the Scotland Food & Drink partnership and the Scottish Government to plan the best way to support the future success of the food and drink industry. This could include further support to help businesses return to local, national and international markets.
And of course, there are more changes ahead for our food and drink industry. As restrictions ease and we move into the ‘new normal’ of Covid-19 our food and drink businesses are looking at the next big challenge. At the end of December, the UK’s transition period with the EU will come to an end. The EU market is the largest source of UK food imports and the largest destination for UK food exports. This is driven by geography, shelf-life and customer tastes.
We are urging businesses to continue to plan for a transition without a trade deal with the EU. Even then there are a whole range of unanswered questions and concerns. Many businesses lack expertise in dealing with exporting and importing products – because they have previously only traded within the European Union. The lack of clarity around labelling is a big part of this and, for this reason, we are asking for a ‘period of adjustment’ at the end of the transition period to allow time for food businesses to make labelling changes.
There is also a real worry about delays at ports to products being imported and exported. Some companies will begin to stockpile again, where they can afford to, but some are unable to do so due to lack of storage space being available. Clarity on a range of issues is required soon to allow food and drink businesses the time to get ready for the end of the transition period.
The Scottish food and drink industry has faced many challenges recently, in particular over the last few months. There are a lot of great opportunities ahead but food and drink businesses need support from the Scottish and UK governments to seize these opportunities and thrive into the future.
David Thomson, CEO, Food and Drink Federation (FDF) Scotland