EDITOR’S VIEW: Freight crisis threatens to nudge catering equipment prices in an uncomfortable direction

Andrew Seymour

There will be many operators out there with the very best intentions of reigniting kitchen projects or strategic equipment decisions that were forced onto the back-burner last year when the coronavirus pandemic plunged the industry into chaos.

The pace and scale at which that happens will depend entirely on circumstance, financial appetite and individual position, but for those buyers that are endeavouring to make purchasing decisions as soon as they can there is a real question mark over what sort of pricing landscape they’ll encounter.

While hospitality operators have been at their wit’s end over the way in which the government has treated the sector since heavier restrictions and lockdown rules were imposed before Christmas, the catering equipment supply chain has been grappling with its own crisis.

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A large portion of the catering equipment sold in the UK originates from overseas and importers face a huge battle to keep prices at normal levels due to extraordinary and unprecedented logistics pressures.

Skyrocketing container costs and reduced shipping capacity – caused by a shortage of containers in the East and bottlenecks at UK ports – have left firms that bring in catering equipment from abroad experiencing the sort of volatility they have never seen before.

Inevitably, the added bureaucratic measures concerning the UK’s new relationship with the EU have merely exacerbated an already delicate situation for parts of the catering equipment supply chain.

Reports of carriers cancelling freight contracts and forcing suppliers onto the open market to purchase containers at rates significantly higher than they would normally pay, plus the addition of fees and surcharges, have left many warning that business simply won’t be viable if it gets any worse.

With experts suggesting the disruption could go on for several months, the short to medium term implications are pretty clear.

Most manufacturers and suppliers will do everything in their power to absorb prices – and many deserve great credit for the way in which they have endeavoured to protect customers in the past 12 months – but they can only shoulder the burden for so long. At some point, there isn’t anything else they can do except pass the costs down the line.

Operators that are in a position to be kitting out new spaces and replacing equipment may notice some serious movements in pricing in the months ahead.

EDITOR’S VIEW: Operators and suppliers want the same thing

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Andrew Seymour

The author Andrew Seymour

1 Comment

  1. This is a good time for the equipment supply market to focus on profitability rather than volume.
    There are investment challenges ahead for all companies and clear strategies will be required to suit differing circumstances.

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