Will your food and beverage supply chain survive the onslaught of Covid-19 and Brexit?

It’s certainly a turbulent time for food and beverage (F&B) retail and wholesale supply chains.

First the lockdown closed the hospitality sector, forcing UK consumers to eat at home and transforming their buying habits overnight.  Now Brexit is expected to pile on more supply chain uncertainty. Retailers and wholesalers are bracing themselves for a Brexit-related uptick in F&B tariffs, red tape and restrictions.

While Covid-19 and Brexit are totally unrelated, they do offer a valuable lesson. They highlight the importance of supply chain agility and resilience. This is something tier two and three retailers and wholesalers can quickly and easily achieve using electronic data interchange (EDI).

EDI solutions can calm the perfect food and beverage storm

Nobody could have possibly predicted the transformation of consumer behaviour triggered by lockdown. Data analysts Kantar said online F&B orders increased by 700% year-on-year during the period. The UK government’s stay-at-home order has also led to a huge surge in demand for home-cooking ingredients. These include eggs, flour, yeast, cheese as well as fresh fruit and vegetables.

In the case of eggs, many retailers are still importing shell eggs from Italy, Spain and The Netherlands to meet unprecedented consumer demand. In July, for example, Sainsbury’s said it was selling around two million extra eggs per week.

Covid-19 is the perfect storm for which EDI was designed. Thanks to process digitisation and automation EDI paper-to-digital solutions take increased workflows and orders in their stride.

Cloud-based EDI fast-tracks food & beverage supply chain partner onboarding

EDI ensures retailers and wholesalers meet demand by onboarding new trading partners in a fraction of the time taken using paper processes. This means retailers and wholesalers can enjoy new levels of supply chain agility as they swiftly chop and change trading partners to ensure continuity of supply.

Order delivery and the all-important order-to-cash cycle are also accelerated thanks to the fact that EDI completes transactions faster and more accurately than ever before. It’s worth noting that around 5% of all manually entered invoice data is incorrect. What F&B retailer or wholesaler can afford 5% of orders to be wrong?

Recent advances in technology mean cloud-based EDI solutions are no longer reserved for big businesses. They are now within easy reach of tier two and three F&B retailers and wholesalers.

Brexit is poised to increase food and beverage supply chain complexity

F&B sector analysts say new lockdown buying behaviours are likely to continue long term. And now embattled retailers and wholesalers must also carefully plan for the impact of Brexit on their supply chains.

With 30% of the UK’s food sourced in the EU, many retailers and wholesalers are looking further afield to avoid an expected increase in European supply-chain complexity.

According to specialist F&B website FreshPlaza, South Africa could soon be a major new supplier for post-Brexit Britain. There are a number of key reasons for this. For a start, South Africa is a world leader in fresh fruit with 90% of its produce exported to the international market. Exports of citrus fruits and grapes are strong, in particular to the European market.

EDI-powered supply-chain agility will be key for retail and wholesale post Brexit

South Africa is a southern hemisphere nation. This means its seasonal food production compliments rather than competes with food production closer to the UK, making supply chains more robust. South African food producers are looking at ways they can supply directly to the UK, avoiding European distribution hubs which may add supply chain complexity.

The UK has also recently agreed that the current trade deal between the South African Customs Union (SACU) and the EU should be rolled over once Brexit is complete. This will result in the creation of a free-trade area covering 90% of bilateral trade between the two nations.

This sounds great news for the UK’s F&B retailers and wholesalers, as well as South African producers. But with the UK’s future trading relationship with the EU still undecided and the Brexit deadline fast approaching, supply chain agility will once again be necessary to overcome uncertainty.

F&B retail and wholesale supply chains must digitise or die

Smaller retailers and wholesalers in particular may crumble if they’re unable to quickly flex their supply chains, secure continuity of supply and keep up with customer demand. Meanwhile suppliers are less likely to trade with retailers and wholesalers if they face long waits for onboarding, order reconciliation and invoice payment. Suppliers are much more likely to take advantage of low-hanging fruit elsewhere.

The retailers and wholesalers able to flourish in this new world of change and uncertainty will be those who harness the power of EDI paper-to-digital. They will be able to act faster, more accurately and in a more cost-effective manner.

Not all EDI solutions are equal – Transalis does not levy VAN charges

Don’t be fooled into thinking that all EDI paper-to-digital solutions are equal. Transalis eDI™ solutions, for example, do not charge every time a trading partner is switched on or off. Nor do they levy VAN charges for every transaction or invoice. Both of these are common charges made by conventional EDI suppliers and can cost companies tens of thousands of pounds annually. Transalis’ approach ensures clients are not penalised when they grow, and they can make cost projections much more easily.

In fact, Transalis eDI™ Connect solution makes supply chain agility easier and more cost-effective than ever. F&B wholesalers and retailers can bundle between five and ten trading partners, allowing them to switch between suppliers swiftly and at no extra cost.

Pandemic Food & Beverage supply chain disruption is expected to continue into the foreseeable future. Add to this the extra complexity of Brexit and there has never been a better time to shockproof your supply chain with the automation and digitisation delivered by EDI.