The impact of COVID-19 on the food and drink industry
Food and Drink North East (FADNE) continues to work with the North East Local Enterprise Partnership (LEP) to provide data and intelligence for the North East COVID-19 Economic Response Group for the Food and Drink sector in the North East.
FADNE is a community interest company that is made up of local business owners and experts who understand the challenges the food, drink and hospitality sectors face, and are working together to solve them. Our aim is to build the North East’s reputation as a food and drink destination with heritage, sustainability, innovation and community at its heart.
We launched FADNE in February 2020 with a high profile visit from the Department for Environment, Food and Rural Affairs (DEFRA) and Henry Dimbleby – the independent lead for the National Food Strategy and co-founder of Leon Restaurants and the Sustainable Restaurant Association. The visit highlighted entrepreneurship, key heritage sectors requiring investment, and innovative responses to social and environmental issues such as food poverty and waste, as well as bringing regional companies from the sector together in a series of workshops designed to guide strategies for scaling operations, targeting retailers, and marketing and branding.
When FADNE launched, the main challenge the industry foresaw was Brexit and its impact on the food, drink and hospitality sectors in the North East. However, a few weeks later Brexit became an afterthought as the world headed into lockdown with the outbreak of COVID-19.
As the pandemic disrupted the industry, we immediately surveyed the 500 businesses in our network to explore the impacts of COVID-19 and received 150 responses within 36 hours. Responses came from the region’s largest manufacturing and processing businesses down to small, artisan food and drink producers. We then conducted a follow-up consultation with the sector only a month later. The data was difficult reading, indicating that there had been a decline of around 89% in employment across the sector.
Ammar Mirza CBE summarised the impact on the sector as businesses having to choose to “innovate, hibernate or liquidate”. Some were able to adapt quickly, some closed, and some re-emerged with different ways of operating. 66% of businesses surveyed were exploring ways of diversifying and innovating to continue to trade throughout the pandemic.
Due to the pandemic, the main focus of FANDE immediately shifted. As international supply chains failed to manage the demand of consumers, the public adopted digital, turning towards local alternatives, creating a huge uplift in ecommerce sales. We created the Local Heroes initiative in March to raise the profile of and safeguard regional food and drink businesses in the North East, as well as bringing producers, suppliers, logistics, storage, distribution and transport companies together to help feed the region. With the launch of our online food market and delivery service we were able to support local traders, as well as our local community, with 10% of every purchase going towards our Community Fund, creating a progressive, circular economy.
Ten months since FADNE launched, we have stood alongside the food, drink and hospitality sectors as North East businesses have faced a national lockdown, a local lockdown, a second national lockdown and now have to operate within Tier 3 guidance. We have worked tirelessly since our launch to lobby and press local MPs, council leaders, mayors and Directors of Public Health on issues that affect the industry – from pushing for outdoor trading to resume, to actively calling for a regional resilience and innovation fund and support package to be established.
Pre-COVID-19 there was a big focus on building resilience in the sector in the lead up to EU Exit. Despite the pandemic, leaving the EU will massively impact the sector, and this is ongoing work that we are actively preparing and planning for so that the North East food and drink sector can continue to thrive and grow.
What we have learnt this year is that businesses can no longer cope with the swinging pendulum of indecision or be expected to adapt and change their businesses repeatedly. We admire the innovative and resilient attitudes of businesses working in the food, drink and hospitality sectors, but want to push and work towards more clarity and consistency in communication and policy. Approaching the sector with serious intent, including identifying how it can be supported to grow as we move into economic recovery and giving it the focus it deserves to achieve sustainable and inclusive growth – this is the only way forward.
By Chris Jewitt, Founder and Managing Director of Food and Drink North East (FADNE)
Read the COVID-19 Intelligence report on the food and drink industry.
