Increased efficiency in the UK fresh produce sector could come at the cost of almost 10,000 jobs, analysts have claimed.
According to industry watcher Plimsoll, for the majority of the fresh produce sector to compete with the leading companies, they will have to shed up to 9,400 jobs over the next year.
Plimsoll said it had identified 182 of the most efficient companies that deliver nearly double the sales and double the profit per person of the average UK fresh produce company.
On average, they are recording £348,000 sales per person, which translates into £8,000 worth of profit per person. By comparison, an average UK operation generates £173,000 sales and £4,000 profit per person.
The company said it had also identified a further 142 companies that are only generating around £71,000 per employee, with spend on salaries far too high for them to be competitive.
For those companies to catch up with the top organisations’ levels of productivity would mean axing jobs.
David Pattison, senior analyst with Plimsoll Publishing, said: “As I see it, it is very easy to fall for the ‘we need more people’ screams from your staff.
“You have to watch this. It is vital to keep your sales per employee ratio and, perhaps more importantly, your percentage of sales used for salaries under control.”
He said the key advice for companies in the fresh produce industry was simple: “Get your sales per person up to or above £173,000, your spend on salaries to 11 per cent of sales or less and control your debts.”
For some of the companies, job losses will be unavoidable if they want to survive: “For 50 of them, it’s a question of pure survival. The remaining 92 are fundamentally well run companies, with only low productivity letting them down.
“Directors of these companies must act now to improve employee efficiency and catch up with the leaders.”
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