‘Supermarket shortages highlight relevance of wholesale market model’

As the extensive nationwide coverage on the shortage of vegetables and salads on supermarket shelves played out across the media, a serious message emerged for everyone in the industry.

It may well have been lost on those who tired after consuming some of the more sensational tabloid headlines and radio phone-ins, but if you continued to read, watch or listen to the stream of articles and comment as the story unfolded, the underlying reasons for the current challenges became clearer.

The empty shelves were not, as some tried to claim, solely the result of Brexit. That said, there’s not much doubt that for a grower/exporter in Spain, for instance, when the crop is short and you can choose your customer, the UK supermarkets are not necessarily the preferred destination now that we’re not part of the EU. Neither were higher prices the result of growers and suppliers lining their pockets; they were reflective of both tough market conditions and prolonged weather patterns that were as extreme as most people could remember.

Arguably the most important fact that came to light was that while multiple retailers were experiencing significant shortages, it was by no means a universal problem. Other parts of the fresh produce supply chain – wholesale markets in particular – could still buy products that were short because they were prepared to pay the necessary higher costs. Yes, the prices for some products reached historical highs, but they were dictated by the climate and the trading conditions, and reflected the commercial principles of supply and demand, a trading environment tenants at New Covent Garden Market are used to operating in.

It is not for me to criticise or judge other organisations or businesses for their practices. I do believe, however, that this situation has again emphasised the validity and relevance of the wholesale market model. The way our tenants do business has been shown to be robust, reasonable and reliable. They have justifiably been emphasising for many years the need for fresh produce to reflect the increasing costs of growing and supplying it. They consistently prove that when the chips are down they will find the product their customers require, while paying prices that deliver a fair and sustainable return to growers.

It’s not always easy when running a business, but wholesalers at New Covent Garden Market recognise and value their role in the supply chain. More importantly, they recognise the responsibility they have to be as supportive as possible of their partners, both upstream and downstream.

If the supply chain is set up in a way that is incapable of passing legitimate costs along at a sustainable level, it will eventually break. Every link in that chain has a valuable role to play, but in the fresh produce supply chain, without good growers we would be in trouble. So, supporting them through the inevitable peaks and troughs has to be the sensible option, doesn’t it?Co