Staying on top of rising prices
Troubles rarely travel alone, they say, and when it comes to rising food and drink prices, a number of factors are combining to cause significant challenges for the foodservice industry in the months ahead.
The fall in the value of sterling against both the dollar and the euro since the Brexit vote last summer remains a key challenge. The Bank of England is forecasting that inflation will reach 2.7% during 2017, and some commentators are suggesting the rate will peak higher than that.
At the same time, other factors are compounding the problem when it comes to specific product categories. In the first two months of 2017, the national media reported that supermarkets were rationing produce such as iceberg lettuce and broccoli due to the extreme weather in southern Europe. Other headlines reported the effect on cod and haddock supplies of industrial action by the Icelandic trawler fleet – now fortunately resolved; and a sharp increase in wine prices as a result of higher import costs.
Alongside rising food costs, issues such as the business rates revaluation and higher staff costs driven by the Living Wage, are all making the prospects seem daunting. However, the reality for operators is that whatever the challenges, they still have a business to run.
As we move into spring, more British produce will become available, and for caterers able to work in partnership with suppliers to offer produce when availability, price and quality are at their best, there will be opportunities.