Consumer products food & drink companies are facing significant disruption, from changing buying behaviour to disrupted supply chains. Whilst at-home consumption has increased, out-of-home consumption – which historically generates the highest margin – has come to nearly a standstill. We hosted our first Consumer practice online forum to bring together Food & Drink CEOs and MDs to discuss these issues, and we were delighted to be joined by Ian Wright, Chief Executive of the Food & Drink Federation (FDF) as our guest speaker.
The FDF is the representative voice of the companies and trade associations which make up the UK's largest manufacturing sector. Ian joined the FDF in March 2015, having previously spent 14 years with Diageo plc - the world's largest drinks business. Earlier in his career, Ian worked for Boots The Chemist, Mars Confectionery and Pillsbury, and had spells in consultancy and politics. Receiving a CBE for political and public service in August 2015.
Ian commenced his speech by underlining the importance of genuine and real leadership, particularly during the uncertainty brought by COVID-19 and the UK-wide lockdown. Positively, Ian added that whilst such circumstances created huge disruption and genuine concern, it also presents a tremendous amount of opportunity for the sector to help support the nation.
We are seeing unprecedented levels of consumer demand in some categories, with sales up over a 200-300%, as well as the resurgence of more traditional shopping behaviours. Consumers are shopping with significant less frequency, with much larger basket sizes and more locally. These behaviours were also highlighted this week by the likes of Tesco’s CEO Dave Lewis and supported by Kantar data, underlining that organisations need to be agile, as well as being prepared to adapt and innovate. Generosity is also key, for instance, drinks businesses for the first time in their history are rapidly producing much needed hand-sanitiser. Furthermore, food companies are donating, and crucially delivering, huge quantities of products to the NHS, care sector, charities and others in need.
Finally, the focus and debate then turned to what is next for the sector post lockdown and whether these retro consumer behaviours become the new normal once again? Will online sales and direct to consumer also become increasingly significant channels?
The forum concluded with an extensive Q&A and general debate amongst our online guests. Ian inspired and instigated much thought and discussion, for which we once again thank him. Judging by the guest’s feedback, an insightful and enjoyable session was had by all that attended.