Buyers are warned to prepare for price hikes as a quarter of restaurant and hospitality businesses hit by shortages Business News

More than a quarter of catering and hospitality businesses have been hit by stockouts in recent weeks, while buyers have been warned to expect higher prices as the chain crisis d UK supply is worsening.

An Office for National Statistics (ONS) survey found that 27% of food and beverage companies experienced low inventory levels, with problems spreading to other industries as well.

A quarter of retailers and wholesalers also reported problems, as did 23% of manufacturers.

A host of factors have caused increasing disruption in supply chains, leading to empty shelves in supermarkets and forcing some restaurant chains to close their doors.

This week, McDonald’s ran out of milkshakes as major dairy suppliers grappled with a severe shortage of truck drivers, while meat processors and fruit farms were also hit by a labor shortage. long-standing work that has been compounded by both the pandemic and Brexit.

Transport industry bosses, meanwhile, have warned buyers to prepare for higher prices, while retailers have raised wages for truck drivers.

The Road Haulage Association told the PA News Agency that the proposed “substantial” wage increases could force supermarkets to pass the costs on to customers.

“The wages of drivers are certainly increasing, often quite substantially,” said RHA chief executive Rod Mckenzie.

“This, in turn, is a cost that will have to be passed on, and given the tight profit margins of most transport operators, that means their customer rates will have to increase.

“In turn, this may mean that more of us will pay higher prices for goods, services and purchases – including food prices – in the future. “

The RHA added that the situation “is not improving” and warned that the long period of time required to train new drivers means government action is needed.

The problems are not limited to the food supply. British automakers reported their worst production figures in 65 years thanks to a global shortage of microchips and worker self-isolation.

Auto factories produced just 53,438 vehicles last month, down 37.6% from the same month a year earlier, the Society of Motor Manufacturers and Traders (SMMT) reported. SMMT boss Mike Hawes said the chip shortage “shows little sign of abating.”

Covid has disrupted the supply of manufactured goods and shipping rates have increased this year as economies reopen, causing demand to surge.

Suppliers of many products that are currently in high demand have struggled to keep pace. Plumbers, who boomed as people carried out home renovations during the pandemic, have been forced to delay work as vital parts are out of stock, with long delivery times.

Kevin Wellman, CEO of the Chartered Institute of Plumbing and Heating Engineering, said the industry has seen increasing disruption for the past 18 months, with problems now being compounded by additional red tape after Brexit. “Manufacturers are doing all they can, but they cannot increase their supplies overnight.

“It’s just one thing after another for the poor, unsuspecting trader who is just trying to make things work. “

He warned people they could face delays and urged them to trust their plumber.

Manufacturers have also faced shortages of raw materials and skilled workers. More than one in seven construction companies say they haven’t been able to get the materials they need in the past few weeks.

Fraser Stewart, architectural director at HOKO Design, said Brexit had been a “massive factor”. The UK’s departure from the EU resulted in longer lead times for materials imported from mainland Europe, such as windows, doors, cement, wood, plasterboard, steel and metals coating, said Mr. Stewart.

He added that demand for building materials looks set to remain high, which means supply issues are likely to persist.

Just over half of manufacturers said they were able to source the materials and goods they needed, but nearly one in five had to change suppliers or find other ways to obtain materials. goods or services.

Some industries where manufacturing remained in the UK reported fewer problems.

Rob Harding, managing director of wholesaler Greendale Carpets and Flooring, said UK carpet makers are “doing very well” despite social distancing in factories and dramatically increased demand.

“There are still a large number of UK manufacturers making rugs – it’s one of the few industries still dominated by UK companies.

Carpets that are not made in the UK are often imported from Turkey, a supply chain which Mr Harding says has held up “reasonably well”, while some niche products from further afield have been delayed.

However, the industry is still affected by rising rates of pay for truck drivers and rising synthetic fiber costs. “It’s the price increase that we need to pass on to our members, and they need to pass on to the public. “

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This notice was published: 2021-08-26 18:52:34

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