Retailers can avoid Brexit fallout by embracing British produce, Newton says

Councils encouraged to establish ‘food resilience teams’ ahead of Brexit
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Retails could help negate a trade fallout following Brexit by taking advantage of consumer desire for British goods and produce, according to Newton.

The operational improvement specialist said that taking immediate action could help avoid knock-on effects – such as increased import tariffs – whilst also satisfying demand for home-grown/made products.

This follows the results of Newton’s YouGov Shopper Experiences Survey research, which revealed that half of UK shoppers believe ‘made’ or ‘grown’ in Britain is a sign of good quality produce.

The survey polled 4,000 consumers about their attitudes to shopping across a range of different measures, from the most important factors in selecting a supermarket, to what they find frustrating.

When asked to select all factors they believe represent ‘good quality produce’ (including fruit and vegetables and meat), 49% of shoppers selected made/grown in Britain, which was second only to being free range, chosen by 50% of people polled.

Staying fresher for longer was a close third with 47% of the vote.

Paul Harvey, Partner at Newton, said: “We believe that there is a broad range of measures retailers and manufacturers can take now to avoid some of the impact of Brexit.

“For example, there’s an opportunity to embrace more home-grown/made products. Our survey highlights that shoppers already associate British goods with quality, so the time is ripe for the food industry to take action.”

He also stressed that switching to more British goods would help retailers and their suppliers avoid potentially costly import tariffs.

“The average tariff on raw materials imported into the UK will be around 5% and that could be inflated by volatile exchange rates,” he said.

“Those rises either must be passed on to consumers – something the industry is reluctant to do – or absorbed by retailers and their suppliers.

“For instance, we know that if retailers take a rigorous approach to working more closely with suppliers, they will typically see supply chain cost reductions of around 6%.

“We also know that challenging the specifications can save 2-5% of raw material costs at category level without adversely affecting the quality of back-of-pack product declarations.

“It’s also vital for retailers to put plans in place to increase the number of permanent staff to mitigate any shortage of EU-national workers and review working practices to ensure they deliver efficient returns.”