There’s a reason Brits are now struggling to find pints of milk, packs of salad and bottles of water in the supermarket — and it’s not all due to the “pingdemic.”
Britain’s grocers are facing a perfect storm of Brexit, a record number of people self-isolating (most of them having been pinged by the National Health Service’s COVID-19 app) and soaring temperatures that drive demand for chilled goods and wreak havoc on store refrigeration systems. All of this is leading to stocks on shelves running low.
Even before the highly contagious delta variant started spreading, the U.K.’s food supply chains were straining from Brexit.
This was most visible in the shortages for seasonal fruit and vegetable pickers — jobs that were often filled by workers from elsewhere in the European Union — and for drivers of heavy goods vehicles, many of whom used to come from Eastern Europe.
The U.K.’s Road Haulage Association estimates that 15,000 EU nationals have left the industry since the start of this year. Add in some 30,000 HGV driver tests that couldn’t go ahead in 2020 because of the pandemic, the closing of a tax loophole used by some drivers in April — and the crisis to find personnel for transporting goods has become severe. Job vacancies have almost doubled from 60,000 around the end of 2020 to about 100,000 today, according to the industry’s trade body.
Brexit creates other pressures on the supermarket sector. While the U.K.-EU trade deal that was struck at the end of last year was for zero tariffs and quotas, there are still frictions today in the form of “rules of origin” checks (to make sure products qualify for no tariff), food safety checks and limits on the number of trips hauliers can make once abroad.
The impact of these disruptions has been most acutely felt in Northern Ireland, where the Brexit deal added a whole layer of bureaucracy in the form of the highly disputed Northern Ireland Protocol.
Overlaid on all of this is the pingdemic. The vast number of people required to self-isolate is disrupting all kinds of retail operations, as well as the factories that actually make and transport food to the big supermarket groups. If products do make it to stores, absent shop-floor staff mean there is no one to put them on shelves or operate cash registers. That can lead to closing tills, or in the most severe cases, the entire supermarket.
Given the challenges, some food suppliers have resorted to measures they took back in March 2020 when the COVID-19 outbreak first intensified. They cut back on less popular products so that their manufacturing facilities could concentrate on filling shelves with the ones that customers bought the most often.
This helps explain what’s now happening with milk. In late June, as the HGV driver shortage worsened, dairy group Arla Foods removed one-pint and two-pint bottles of milk, so that it could still supply four-pint cartons, as the latter are bought most frequently by families. The smaller sizes only began returning to shelves last week.
And there’s another factor adding pressure on supply chains: Britain’s miniheatwave. This drives demand for salads, soft drinks, beers and wine, ice-cream and mineral water (which are bulky to store in stock rooms) and barbecue meat.
Even in normal times, it’s not unusual to see the fresh food aisles stripped of lettuce and stocks of burgers running low after a particularly hot day. Soaring temperatures also strain refrigeration units, which can malfunction just when they are needed most.
Fortunately, some relief is coming: From Aug. 16, fully vaccinated people in England will no longer need to self-isolate if they come into close contact with someone who has tested positive for the virus. But that’s still some weeks away.
Bringing the date forward would help ease the current situation. The government said on Thursday that food manufacturing and retail depot workers would be able to test daily rather than self-isolate, but the exemption does not apply to shop-floor staff in supermarkets.
Meanwhile, when it comes to Brexit red tape, applying a common sense approach, rather than being tripped up by tiny details, would also ease the burden. Making temporary work visas available for delivery drivers from outside the U.K. would alleviate the current shortage.
If these issues are not tackled, then the food retail industry may enter its busiest trading period — from the autumn into Christmas — hamstrung by the largely unseen parts of their operations. Archie Norman, chairman of Marks & Spencer Group PLC, has already warned that the retailer is cutting back on Christmas products because of the “labyrinthine restrictions” affecting Northern Ireland.
That would be ironic, because after COVID-19 lockdowns ruined December 2020, many Brits will be looking to pull out all the stops on their celebrations this year. It would be tragic if Christmas 2021 was stolen again — this time by supply chain snarl-ups.
Andrea Felsted is a Bloomberg Opinion columnist covering the consumer and retail industries.
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