Wholesale set to gain from food scenario

Wholesale markets could benefit from a potential disruption in supermarket supply chains created by climate change and food prices.

The theory is one of a number of scenarios for the long-term future of wholesale devised by market expert Promar International.

Writing in this month’s Promar Digest, senior consultant Andrew McLay set out four scenarios for the future of food and wholesale’s position within it.

McLay suggests mature food industries are likely to either see a slow recovery with current trends continuing, a consolidation of supply chains, a new, more sustainable food order with low carbon, local solutions or a food crisis in which spiralling prices and slowing economic growth moves power back to suppliers.

In the first two scenarios, wholesale is predicted to struggle as a decline continues and retail strength grows.

But McLay argues that a new food order “provides perhaps the greatest opportunities for wholesale markets, provided they are flexible and fast enough to respond to the changing market”.

McLay told FPJ: “If your supply chain is like Tesco’s and relies on global scouring then that could be vulnerable in future. Most supply chains are based on cheap oil and there are opportunities for wholesale to benefit from local food and lower costs.”

World Union of Wholesale Markets secretary general Maria Cavit said: “I would say that the market resurgence in the past five years or so clearly demonstrates the adaptability of markets, thus reconfirming their existence as a vital player in the growth of local economies and businesses.”