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“The UK’s departure from the EU on 29 March – Brexit – is still shrouded in uncertainty, partly around whether a meaningful agreement can be forged that will allow Britain to continue trading with its former EU partners without businesses and consumers noticing a big difference or whether the separation comes after ‘no-deal’. In the case of the latter, the potential is there for large-scale disruption to the UK’s food supply chain given so much of what is eaten in Britain comes from the EU at both the finished product and ingredient level.
As Hamish Renton, managing director of UK-based food and drink consultancy HRA, puts it: “If it [Brexit] goes the way it might, it will be carnage and will dwarf all other trends.
“There would be issues with the availability of raw materials. And if there is any delay in the importation of those you won’t be able to buy something fresh because it will be stuck at Dover.
“There will be choppy seas for retailers and manufacturers. There are probably 25,000 products in stock in the average Tesco or Asda and perhaps 20% of those are purely British.”
This ‘doomsday scenario’ may not come to pass, of course, but the threat of it has already had an impact on UK food companies with businesses such as Premier Foods admitting it is stockpiling ingredients and admitting in January it will take a view on whether to extend that approach to finished products.
For trend-watchers keen to pick up on what could drive innovation in 2019, stockpiling does mean cash is being spent on inventory that could, potentially, be spent on expansion or product development.
As Renton says: “Big companies are so preoccupied with Brexit it is tougher for them to innovate.”
But Brexit may also bring opportunities. Smaller companies or even start-ups may fill that innovation gap as John Stapleton, a serial entrepreneur behind food brands New Covent Garden Soup Co. and Little Dish who now operates as an angel investor and industry adviser, points out.
“Given the risk of tariffs etc., ‘brand Britain’ could be a thing as long as it is relevant in terms of heritage and not just about sticking a Union Jack on the side of products,” he says. “And the source of origin rules may not relevant after Brexit so we could be making Brie in South Wales, for example.”
Brexit aside, however, there is some agreement among market watchers and industry experts about the key trends we will see in the UK food sector in 2019…”
To read the rest of this article go to the Just Food website. This article was written by Andy Coyne and published on the 23 November 2018.
