James Bielby, CEO, Federation of Wholesale Distributors
“Wholesalers have asked the prime minister for clarity and confidence and he’s partly delivered the first of those. However our members’ experience of previous lockdowns and u-turns means they’ll be cautious about investing ahead of each scheduled opening date. Those who distribute to the hospitality sector can’t afford to foot the bill yet again for government dithering.
“We saw several times last year how short-notice changes disproportionately impact wholesalers, who have to stock up in advance of demand. What we need from government is at least two weeks’ notice if it has to deviate from the roadmap at any stage, or if that’s not possible, a consideration for the cost of the excess stock that will go to waste as a result of the late changes.
By Lyndsey Cambridge2021-02-23T10:22:00+00:00
Stock stuck in the system is causing wholesalers a cash flow crisis which could have ‘devastating consequences’ for credit ratings
The Federation of Wholesale Distributors is urging suppliers to be flexible with wholesaler’s payment terms ahead of the hospitality restart in April in order to avoid “devastating” consequences to credit ratings across the sector.
The call comes as a growing number of wholesalers are failing to meet suppliers’ payment terms as a result of a cashflow crisis brought about by the latest lockdown. The government this week revealed its plans for the roadmap out of lockdown in England, including the opening of schools on 8 March and the return of the hospitality sector on 12 April, albeit for outside only until at least mid-May. However there are growing concerns that without more flexibility from suppliers, wholesalers will be unable to meet their customers’ orders.
17th February 2021
The Federation of Wholesale Distributors (FWD) has launched a petition asking the Government to offer food & drink wholesalers bespoke financial support in order to save them from collapse in the coming months.
The petition reads: “Food and drink wholesalers are crucial to supplying hospitals, care homes and schools and are a lifeline for vulnerable communities. They are also integral to the post-pandemic economic restart. Despite this, they have been excluded from much Government support and face sector-wide closures.”
It is the latest attempts by the trade association to highlight the wholesale industry’s troubles. The FWD stated that the need for financial aid in the sector is greater than ever with it warning crucial public services will suffer without it.