Food suppliers at risk as supermarkets stand firm

After City A.M.’s exclusive report of a rise in prices from Premier Foods (1), it has emerged that food suppliers are under pressure from supermarkets over who should take the hit for the cheaper pound.

Recent research shows that, in the final quarter of 2016, over 6,000 food suppliers were showing signs of financial distress, whereas supermarkets were showing signs of stability.

As contracts between supermarkets and suppliers are renegotiated for the coming year, some suppliers are trying to increase prices as a measure to offset the cost inflation which has come about due to the post-Brexit decrease in the value of the pound.

But with many supermarkets playing "hardball" by not sharing the burden of the increased costs across the supply chain, some smaller suppliers, many of whom have limited room for negotiation, could potentially be put at risk.

At Beavis Morgan, we have extensive experience of working with clients in the food industry and our professionals are acknowledged experts in issues affecting organisations operating in this area. We work closely with our clients to help them plan effectively for the peaks and troughs, making it easier to run your business and to maintain effective management of your company’s working capital.

In turn, if you have any concerns regarding the financial position of your business, our experts at our partner business BM Advisory are readily available to assist. The sooner advice is taken, the greater the range of options that could be available to you to resolve any issues and get back on the right track.

Contact Matthew Burge in the first instance or your usual Beavis Morgan Partner for further information about how we can assist you and your business.


(1) City A.M. – Manufacturing giant Premier Foods to increase prices due to Brexit vote