Delivery issues need addressing, but not at last minute, food industry says

With a driver shortage disrupting deliveries to convenience stores, retailers and wholesalers are urging immediate measures to ensure the supply.

Steve Singh, who runs a Costcutter store in Kirkheaton, West Yorkshire, said deliveries at the time is “so unpredictable.”

“You have an order, you place an order in to come and then at the last minute you get a text that says that there’s a change, and that can mess up with your staff, or what you have planned,” he said.

“It is difficult and it does need addressing, not preferably at the last minute.”

Singh said alcohol, particularly beer, is facing availability issues the most and with Euro 2020 tournament progressing, he expects the demand to be “quite severe.” “If I cannot get the stock, I will try to source it from elsewhere,” he added.

Responding, Costcutter said they are working to minimise the impact on retailers, adding that all deliveries are expected to return to normal in the coming week.

“A national shortage of delivery drivers, coupled with increased demand due to good weather, did see some deliveries delayed recently. This issue has affected the whole sector, however with our delivery partners at Nisa, we are working to minimise the impact on our retailers,” a Costcutter spokesperson said.

Co-op-owned Nisa supplies Costcutter under an agreement between Costcutter and Co-op, which is extended even after Bestway acquired Costcutter.

Nisa said: “A number of factors, including a national shortage of delivery drivers and a sharp increase in volume driven by the fine weather, created challenges toward the backend of last week. While we worked hard to minimise the impact on partners and avoided any volume intervention, some did experience delays to deliveries.”

The group added that the situation has now improved with the backlog cleared, but said the nationwide shortage of drivers continues to affect the whole industry.

Dawood Pervez, managing director at Bestway Wholesale, said they have experienced limited disruption where suppliers are heavily reliant on agency drivers or third party logistics providers.

“We have been working closely with key suppliers to manage availability throughout the pandemic, which has enabled us to work ahead and mitigate the vast majority of the issues to date. We continue to monitor the situation closely with suppliers on a daily basis,” he added.

Pervez said Bestway has been able to maintain good service to their customers as they manage the vast majority of deliveries to customers with their own drivers and logistics fleet.

Ian Sharpe, impulse commercial controller at Addo Food Group, which owns brands like Wall’s Pastry and Pork Farms, said the situation could get worse as businesses, particularly foodservice, have started opening up.

“We're in the symbol and convenience sector and we are managing this key supplier product going in distribution into our warehouses. There’s ones that need the hauliers to come out. We haven’t had business-threatening situations yet, but we've had in 10 days, 14 failed deliveries,” Sharpe explained.

“They vary and they are across most customers. Every other haulier that we use with our business internally has also given us problems. Basically, we haven't got enough drivers for the vehicles.”

Tim O’Malley, group managing director of leading fruit and vegetable suppliers Nationwide Produce, has warned that fresh produce headed for UK stores is being dumped due to driver shortage.

“The acute shortage of HGV drivers is now the direct cause of perfectly good, graded and packed fresh produce being dumped or rotting in cold stores, waiting for wheels to go under it,” O’Malley said. “In all my years in fresh produce I’ve never seen anything like this.”

Concerns of Price Rise

Pervez added that the industry might soon need to factor in the issue of wage inflation within the supply chain which usually follows labour shortages, and the resultant price rises.

“Whilst we are not seeing an impact yet, we cannot discount the fact that price increases may result within the logistics chain, and then of course, the question will be asked as to whether those increases will be passed on to the consumer. We hope that will not be the case,” he said.

The Federation of Wholesale Distributors (FWD) noted that shortage of drivers could threaten food supply in some areas, and has urged the government for a temporary extension of drivers’ hours, similar to the one put in place last year when retailers were facing shortages.

“The driver shortage has reached crisis point for some of our members and we believe it is likely to get worse as more hospitality venues open and demand increases,” said James Bielby, FWD chief executive.

“With the estimated 70,000 shortfall in HGV drivers, some wholesalers have had to limit the number of deliveries they make to convenience stores which has led to some availability issues.

“They have done all they can to keep their customers stocked, including raising drivers’ wages and even sending depot staff out in non-HGV vehicles to fulfil smaller orders. Some have had to turn down business in order to fulfil orders to regular customers.”

Bielby said they will be meeting ministers this week to discuss options, which include even having army drivers on standby to ensure uninterrupted food distribution.

“Wholesalers have tried engaging agencies but these are also short of drivers,” Bielby added. “The product manufacturers who supply into the wholesale channel have similar issues with distribution and our members are reporting particular difficulties getting hold of soft drinks, beer, and chilled products like cream, cheese, yoghurt and meats.

“We’ve asked the government to re-instate the temporary extension of drivers’ hours (from 9 to 11) which was in place last year but ended recently. Other proposals we are putting forward include ending furlough for HGV drivers, temporarily waiving requirements for medical certs and CPC for those which have run out, and using army drivers to deliver to vulnerable communities.”

Meanwhile, the Road Haulage Association (RHA), the trade body representing road transport operators, has presented the government with a 12-point plan to tackle the situation, saying that the driver shortage has now hit “catastrophic proportions.”

“The upturn in the economy since Covid19 is increasing demand across supply chains and the reopening of non-essential retail outlets and parts of the hospitality sector is, making the situation even worse,” Richard Burnett, RHA chief executive, said

“The pandemic also resulted in the loss of about 12 months of driver training and testing. The long-term ineffectiveness of apprenticeships for lorry drivers and the general hostility from authorities and the government is also unhelpful as regards recruiting and retaining drivers. And while we welcome the increase in HGV apprenticeship funding to £7000, this barely scratches the surface of the problem.”