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Every segment of the food industry has faced pandemic-related disruption. From the hospitality venues forced to close for months on end to the retailers seeing less footfall due to social distancing measures, and from the wholesalers striving to meet demand on a skeleton staff to the producers who have had to find a new home for excess stock.
Recently unveiled lockdown exit plans have garnered mixed responses from the sector, but whatever your view, the dates, as changeable as they are, offer the industry a greater sense of certainty about the future. Miles Needham, partner at specialist business advisory firm FRP, said the months ahead will be a “critical time” for the industry.
“Many food and drink operators, particularly those linked to non-essential retail, are facing challenging cashflows, looming tax and lease arrears, and a reduced workforce which will make it harder for them to bounce back, even with additional government lifelines such as the reduced VAT rate for the hospitality sector and furlough scheme extension,” Miles said.
“It’s vital business leaders use these next few months to plan,” he added. For instance, foodservice businesses that pivoted to provide takeaways should review the current performance of their scheme and assess future challenges, he says.
The same goes for retailers that introduced new online, click and collect or delivery services due to Covid-19. While these have proved to be popular tools during the pandemic, they might not be viable for the long-term.
The food and drink sector should also factor in government support, such as the recently announced £5bn high street recovery fund, or the Help to Grow scheme and furlough and business rates relief extensions, which were announced in the Spring Budget. “The two things business leaders need to focus on in the immediate term are forecasting and communication,” Miles said. “Planning ahead in the current trading environment is undoubtedly challenging, but it is critical business leaders calculate the level of financial support needed and the timing of cash pinch-points.”
Emily Shirley, general manager of Vistaprint UK and Ireland, offers 5 more tips for how SMEs can boost their profits after lockdown:
Professional partnerships are a great way to embrace new opportunities. There’s loads of ways to support other small businesses in your community and boost your own – benefitting your business in a multitude of ways. Your business and brand will be put in front of a whole host of new potential customers and clients.
Use the reopening of businesses after lockdown the best way you can, by offering special offers or discounts to customers, to set yourself apart and attract them into your business. Increase the foot traffic into your business by using visual merchandising to advertise your offers and discounts to potential customers, whilst also utilising your social channels to advertise those offers.
Your window isn’t just an opportunity to showcase your products, it’s also a space where your brand can make a connection with potential customers – utilise this by telling a compelling visual story that appeals to people’s needs, emotions and desires. Understanding your target customer will influence the props and products you should use, reflecting current trends or how quickly you will need to grab their attention – use colour and contrast to stand out from the crowd.
When done effectively, brands can grow a loyal and engaged following across social media platforms, which can increase brand awareness while attracting potential customers. Develop a customer persona for your business, imagining a representation of your ideal customer, learn what to post on social media to drive inspiration and interest, and decide how often you’re going to share that message with your audience – creating a good balance.
Now is a great time to really examine the current market and establish what your business can offer at this time. Take a step out of your norm and add to your business something that you might not have considered before the pandemic. Think about ways your business can provide customers a product or service which will either be a convenience, or just something to bring a smile to their faces.
Taking these tips on board will help businesses across the food sector bounce back from Covid disruption stronger than before.