We’re not stockpiling, just obeying orders

Yes, shoppers are buying more food than normal – because they are obeying instructions to stay at home

On Friday evening I visited Waitrose in Godalming where, in aisle five, what a sight met my eyes. Stretching seemingly into the horizon was row upon row, nine-pack upon nine-pack of the supermarket’s own brand, pure white, ultra soft bathroom tissue. I felt as Howard Carter must have done when first he gazed on the riches in the tomb of Tutankhamun. I got out my phone to take a picture. Behind me a woman turned into the aisle and audibly gasped.

One of the defining images of the coronavirus crisis has been the empty shelves in our supermarkets – particularly in London and the South East. Loo roll has become more scarce than hen’s teeth. We now know that Brits bought an extra £1billion of goods in the past three weeks. We have been told this is a source of national embarrassment.

But I have become uncomfortable with all the shopper-bashing and guilt-tripping (and not just because I have put one or two more cans of baked beans in my basket than usual).

Undoubtedly, some people are hoarding and more needs to be done to ensure the elderly and key workers are able to buy the food that they need. But a closer look at the numbers, allied with an understanding of the business models of UK food retailers, suggests we have not gone collectively bonkers. In fact, British shoppers are in some ways only doing what they have been told.

Let’s start with the £1billion figure. It sounds like a lot of extra food. But supermarkets sold £194billion of goods last year – or £3.7billion a week. So, an extra £1billion over three weeks is only a 10 per cent rise per week.

And it is surely entirely understandable that we are all buying a bit more. Everyone has been told to stay at home, which means that all the meals that were being eaten out – the Pret sandwiches at the desk, the Greggs sausage roll on the building site, the school dinners and the pub lunches – are now being catered for by the family kitchen.

What is more, there has long been a trend of shoppers (especially in the South East) buying their staples, such as cereal, pasta and, yes, loo roll, online and then topping up with more frequent, smaller shops. In the industry jargon, this has resulted in a dramatic shrinking of “basket size”. The traditional “weekly shop” has become increasingly rare; customers are now much more likely to visit smaller convenience shops than big, out-of-town mega-stores. Supermarkets have fast adjusted their property portfolios accordingly.

The result is that the number of food shopping trips the average buyer makes a year has shot up to 179: a 14.3 per cent rise since just 2013. That, of course, equates to nearly 3.5 shopping trips a week (although the figure is probably much higher in London and the South East).

Clearly popping out to the shops 3.5 times a week is somewhat at variance with the Government’s advice to stay at home. So yes, people are buying more. But that is because they need more and are planning to leave the house less frequently.

Why does this appear to be more of a problem in the UK than elsewhere?

It is because our food retail sector is famously one of the most competitive in the world. For years now the so-called “Big Four” supermarkets – Sainsbury’s, Tesco, Asda and Morrisons – have been fighting a war on two fronts against online delivery services like Ocado and discount retailers like Aldi and Lidl.

The upshot is the British supermarkets provide cheap goods in huge volumes at wafer-thin margins. They also have to cope with astronomical rents and nose-bleed business rates based on the value of their properties. Again, this is a particular problem in London and the South East and it dissuades retailers from wasting precious floor space on big stock rooms. In order to operate in this environment and not go bust, the supermarkets must run hyperefficient, just-in-time supply chains; hold the absolute minimum of surplus stock; and replenish their shelves based on seasonal demand models.

What we have seen in the past few weeks is incredibly tightly calibrated business models run slap-bang into a big – but not unreasonable – surge in demand. One thing is for sure: the empty shelves say nothing about the stiffness of the British upper lip one way or the other.