‘It’s not greed raising prices, it’s a storm of supply and staffing’

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HOSPITALITY businesses could face unfair criticism on social media in the coming months as a ‘perfect storm’ forces them to increase prices, according to a local wholesaler.

Martin Mitchell, a director at Valley Foods, said that suppliers and manufacturers were struggling to source raw materials and labour, meaning goods were often in short supply or more expensive to buy.

He said that hospitality businesses were likely to be among the hardest hit by rising costs, having already seen forced closures and staff shortages brought on by the pandemic.

He feared these businesses would be harshly judged on social media should they have to raise prices.

He said: ‘In the hospitality trade it’s a perfect storm. They’re getting price increases from wholesalers and they might have printed menus, so they can’t necessarily pass that on to the customer unless they reprint their menu.

‘There’s also a massive issue for them with staffing and employment costs going up. At some point they will have to price up, which will mean that people on social media will shout and scream that it’s greed.

‘But there’s no greed in hospitality at the moment, because no one’s making any money.’

Mr Mitchell said that Brexit and Covid had caused supply bottlenecks in a number of ways.

He added: ‘At the moment, because of Brexit, we’ve got major customs issues for products coming in from Europe, which is causing delays with paperwork.

‘We’ve still got issues with a lack of containers and the cost of containers sky-rocketing. In the supply chains there’s a lack of the basic materials to produce goods.

‘For example, with Heinz baked beans, they might not have the tins they need. Coca-Cola have had to drop two or three lines because they didn’t have the ability to make their cans.

‘We’re seeing an impact with staff due to Covid-19 too. Some of the small suppliers and manufacturers have had to restrict their lines because they don’t have the workforce to produce them.’

Mr Mitchell said that he expected the difficulties to cause more price inflation, at least for the first half of the year.

‘Everything’s a challenge at the moment. We’re getting over the hurdles but it’s just taking time. For us, instead of one person looking after purchasing at the moment, we’ve got three or four, and we’ve got one person designated to looking at customs full-time. All these kinds of things add to costs for businesses.

‘We are going to see prices continue to climb, I think over the next six months, and then we should hopefully see some stability when things start getting back to normal.

‘A lot of it is about getting people back to work. There are a lot of people who have left their jobs – because they decided they would prefer to do something different during the pandemic – and those jobs need to be filled again. This is for things like picking, packing raw products and manufacturing,’ he said.

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