Grocery retailers insist they are ready to cope if lockdown bites again
When Leicester became the first British city to suffer a second lockdown, in June, supermarkets assumed that shoppers might start hoarding again. They did not. Sales in Aberdeen remained stable too, after a spike in coronavirus cases forced businesses to shut earlier this month.
Grocers say that this is because battle-hardened Britons have realised that there is no need to stockpile.
Indeed, industry data in June suggests that trust in the food and consumer goods sector has hit a seven-year high. But consumers can be fickle, so the major chains are preparing for the possibility of a return to stricter rules if a second wave of Covid hits.
Local lockdowns pose little challenge, says Andy Perry, who runs the supply chain at Co-op.
“We’re almost planning for seasonal peaks, for periods of the year where it would normally be quiet,” he says.
“A lot of the things we’ve done are still in place.”
Andrew Murphy, the director of operations at Waitrose, believes the firm is now much better placed to handle another upswing in infections.
“We think we’ve got a way of operating that mitigates and manages [local lockdowns] well,” he says. “We’re not too concerned about that.”
Perry says his team will dust down the framework developed during lockdown if panic buying takes hold again. He adds: “I think we’re in a much better position than we were at the very start of it.
“Would we have a bit of disruption? Yes, but I don’t think it would be anything like before.”
Tesco boss Dave Lewis says that ministers’ messaging will be key to avoiding chaos if Covid takes hold again – a warning they would do well to heed after months of conflicting announcements on schools, quarantines and commuting.
“If the Government calls different degrees of crisis, we have different degrees of operating the stores,” he says. “If there is one thing that is so important, it is the clarity of the communication. If it is local, [the guidance] needs to be local. If it is national, then it needs to be national.”
New rules such as compulsory mask-wearing in stores tend to influence how people shop and behave, Lewis says. This can dent sales or drive harmful behaviour, and it is essential to think through the consequences.
Inadvertently, some of the supermarkets’ planning before coronavirus for how supply chains would cope with a disorderly Brexit helped them deal with the pressures they faced at the onset of the crisis. At some grocers, the same teams have tackled both problems.
But although businesses now know they can largely cope with disruption far worse than anything likely under a no-deal exit from the European Union, the single biggest unknown remains what will happen if there is friction at the border.
“The timing of this [exit] at the end of the year if there were to be a cliff edge is probably the worst,” Lewis says. “The supply chain will be full, preparing for and then executing on Christmas, so the ability to build any stock up by the end of December will be more limited than it was when we were planning before.”
‘Would we have a bit of disruption? Yes, but I don’t think it would be anything like before’
Grocers believe panic buying will not be as damaging if lockdown rules are reimposed