Food Business

How is COVID-19 changing the food industry?

In order to understand food system consolidation and resilience, we’ll be monitoring COVID-19’s impact on the structure and economics of the food industry, identifying where old business models are forced to expire and where innovation is shaping new alternatives. We’ll also be looking at where companies are prioritising food that is healthy and affordable, and where private sector solutions to food access problems are ensuring that vulnerable groups receive the food they need. In the long-term, will the changes we see in this sector hinder or accelerate progress towards a food system that is healthy and sustainable for human and planetary health?

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McDonalds closes UK restaurants and reports declining sales

Even the biggest restaurant chain in the world is affected by coronavirus. McDonalds, who have closed UK restaurants but not, for example, restaurants in the US, are seeing a significant decline in sales during March.  Impacts may be felt for years, possibly meaning fewer new restaurant openings in the future.

COVID-19 impact on food businesses: IGD summary

IGD’s update shows:

  • Morrisons offering 10% discount to NHS staff
  • Retailers expanding their product innovation and services for online deliveries.
  • Co-op boss taking a 20% pay cut
  • Deliveroo finding new partnerships to grow its customer offering
  • KFC reopening 11 restaurants for delivery only via Deliveroo, Just Eat and Uber Eats.

Pret a Manger re-opens stores near London hospitals

Pret a Manger is opening 10 stores located near London hospitals in order to provide fresh food (a limited Pret range) at a 50% discount to NHS workers, as well as aiming to donate 7,000 meals a week to charities.

Other companies followed suit in tailoring their services to make it easier for NHS staff to access essential food.

Morrisons offer 10% discount to NHS staff

Along with Co-op, Morrisons are offering a 10% discount to NHS staff until mid-July.  All supermarkets offer some kind of prioritisation for health service and care workers (mainly dedicated shopping times) but we have yet to see discounts and price offers across the sector for key workers or (economically and clinically) vulnerable groups.

Restaurants re-open as grocery stores with delivery capacity

In response to the sector-wide forced closure, many restaurants are temporarily reinvented themselves as mini grocery stores with local delivery capacity.  Here a number of London restaurants are profiled, and while it is unclear to what extent these initiatives are specifically helping vulnerable groups, Leon are additionally raising money for key NHS workers.

Tesco says even retailers will suffer as a result of coronavirus

Despite showing full-year growth in UK profits and sales, Tesco warns that even retailers will incur increased costs due to coronavirus.  These will come from staffing, distribution and in-store expenses, although are expected to be largely offset by food sales growth and business rate relief.