Quarter of food and hospitality firms hit by low stock levels – ONS

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More than a quarter of food and hospitality firms have been hit by low stock levels in recent weeks as Britain’s mounting supply chain crisis takes it toll, according to new figures (Tom Wilkinson/PA) (PA Wire)
More than a quarter of food and hospitality firms have been hit by low stock levels in recent weeks as Britain’s mounting supply chain crisis takes it toll, according to new figures (Tom Wilkinson/PA) (PA Wire)

More than a quarter of food and hospitality firms have been hit by low stock levels in recent weeks as Britain’s mounting supply chain crisis takes it toll, according to new figures.

The Office for National Statistics (ONS) said its recent business survey found that 27% of food and accommodation firms have reported lower than normal stock levels – the worst-hit of all the sectors.

Low stock levels were also reported by 23% of manufacturers and 25% of firms in the wholesale and retail trade, repair of motor vehicles and motorcycles industry.

It comes amid a mounting supply chain crisis, which is increasingly leaving supermarket shelves bare and leading to a shortage of materials and higher prices across a raft of sectors, from housebuilding to car production.

A strawberry milkshake at a McDonald’s (Liam McBurney/PA) (PA Wire)
A strawberry milkshake at a McDonald’s (Liam McBurney/PA) (PA Wire)

Fast food chain McDonald’s had to pull milkshakes and bottled drinks from its menu earlier this week as it battled against supply problems amid a shortage of lorry drivers.

The latest ONS fortnightly business poll revealed that firms across the UK have been struggling to get hold of materials, goods and services.

More than one in seven construction firms – 15.4% – said they have not been able to get the materials they need in recent weeks, while 9% of hospitality firms also reported the same issue.

Nearly one in five manufacturing firms – 18.4% – have had to change suppliers or find alternative ways to get materials, goods or services, with 16.5% of construction firms and 11.4% of food and hospitality companies reporting the same, according to the ONS.

It found less than half of builders and hospitality firms said they had been able to source all the materials, goods and services they needed without issues – at 42.1% and 46.2% respectively.

Gareth Belsham, director of the national property consultancy and surveyors Naismiths, said: “Yesterday I visited a site in Sussex where an established developer who’s building eight homes has had to stop significant parts of his build because he cannot get enough cement for love nor money.

“All his usual suppliers, within a wide radius, have only a handful of bags available between them.”

He said that larger companies often get pushed to the front of the queue because suppliers will prioritise larger orders, and have been able to stockpile, meaning they are better sheltered.

Just over half of manufacturers – 51.4% – said they were able to get hold of the materials and goods they needed in the survey between July 26 and August 8.

Housebuilders are experiencing issues (David Davies/PA) (PA Archive)
Housebuilders are experiencing issues (David Davies/PA) (PA Archive)

The UK’s largest housebuilders have been reporting increased prices of vital materials such as cement and steel in recent weeks.

Grafton, owner of the builders’ materials supplier Selco, revealed on Wednesday that shortages of core materials due to supply issues had pushed up prices by around 7.5% year-on-year in the first six months of 2021.

A lorry driver shortage in the UK is adding to post-Brexit disruption and worldwide material supply problems caused by the pandemic.

The ONS’s survey also showed the rising impact of the lorry driver shortage on the haulage sector, with the transportation and storage industry seeing nearly a fifth of firms – 18% – having paused or stopped trading in mid-August.

This was largely driven by the freight transport by road industry and the unlicensed carriers industry, the ONS said.

Speaking to the BBC Coral Rose, managing director of Country Range, which delivers food to care homes and restaurants, said: “We have been talking about this as an issue for a long time, for many months.

“While we are coping now, September is going to be much worse. We have schools coming back, we have workplaces returning, we have the tourist season still in full swing, and then it just builds all the way up to Christmas.

“So if the Government cannot release this temporary EU Visa scheme to get some lorry drivers over here pretty quickly, then we’re going to be in trouble.”

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