asino owner Rank Group and historic brewer Adnams have become the latest big names to issue warnings over distribution issues and the so-called “pingdemic”.
Workers being “pinged” into self-isolation – a rule ended this week for the double jabbed – an ongoing staffing crisis and Brexit-fuelled driver shortages in the delivery sector are all hitting leisure and hospitality firms.
This week fast food chain Nando’s temporarily closed nearly 50 restaurants due to chicken shortages and staff absences, and KFC warned of imminent shortages amid ongoing “disruption”.
On Thursday Adnams’ chairman warned the 149-year-old Suffolk-based brewer and pubs group is struggling with “some upward pressure on wages”, rising input costs, and “some difficulties in wine supply”.
Rank CEO John O’Reilly told the Evening Standard the group has been hit by the “pingdemic”, with 6-8% of staff off work self-isolating on average, and similar wine import issues.
READ MORERising restaurant bills inevitable as firms hike staff wages, say bossesFTSE 100 takes a tumble as investors fret about US policy and fresh Covid outbreaks“It moves from day to day,” O’Reilly said. “Back end of last week we couldn’t get halloumi fries, which had a major impact on our menus. And this week we’ve got a problem with Sauvignon blanc, which has got me in a cold sweat.
“It’s products, logistics and packaging… You never know where the next challenge is coming from.”
The chief executive quipped that the one upside to seeing a shortage in the popular wine is that his casinos will probably sell more Chablis, which has a higher price point.
He said: “The good thing is our customers recognise and understand the challenges, because they’re seeing it everywhere.
“We’ve got great suppliers who are doing everything they can to help us, but it’s a challenge right now.”
The comments came as a new report from Lloyds revealed staffing shortages and rising input costs saw momentum in the UK food and drink sector stall in July. Output declined at the fastest pace in eight months.
O’Reilly largely blamed Brexit for the staffing crisis, which has seen even Michelin-starred restaurants forced to close services. The shortage is particularly acute in back-of-house roles, and in “staycation” coastal destinations.
Wages in the sector, historically often below the London Living Wage of £10.85 per hour, have risen in response in recent months.
David Moore, owner or Fitzrovia’s Michelin-starred Pied à Terre, told the Standard he has already raised salaries for his chefs and floor staff by around 10%, while Mark Derry, executive chairman at Brasserie Bar Co, said the pub chain has had to increase salaries for certain roles by 6.3%.
Derry said: “The reality is that with employee tips not qualifying for furlough, this has caused many long term hospitality professionals to leave the sector as they seek more stable jobs.”
Rank’s 52 Grosvenor venues around the UK were fully shuttered for 66% of the six months to July. O’Reilly said the lack of tips in the period has hit staff, and that it is “right and proper” the listed firm is going through a pay review which will see staff wages increase.
The chief executive put the labour crisis down in part to the “impact of Brexit on the availability of international workers in the UK”, saying: “We have historically been an appealing employer for young EU citizens who want to spend a couple of years in the UK, improve their English and learn to be a croupier. It’s a nice job. That source [of labour] has dried up.”
Nando’s said it plans to ensure all its restaurants are open by Saturday. But the wider supply-chain crisis looks as if it could be here for the long term as the food production sector also struggles with staff shortages post-Brexit.
Chicken supply giant, Avara Foods, told The Daily Telegraph its UK workforce had been “severely depleted as a result of Brexit” and that this was “causing stress on UK supply chains in multiple sectors”.
It said: “It looks increasingly likely this is a structural change in the UK labour market, which shows no obvious sign of being resolved quickly.”
