‘Don’t panic’ logistics..

I endured a weekend viewing of George Eustice assuring us that there was no need to panic buy as there was plenty of food in the system.

Well if you are considering contemplating a fortnight’s ‘self-isolation’ you might just consider it would be good to do as far as possible, two weekly shops in one. As the norm is for both partners to work then this is going to be a substantial change to the family dynamic so it’s not actually panicking, it’s logical. (Indeed, ‘lockdown’ in France has now led to similar views of empty shelves.) After that you might also wonder whether you are likely to remain employed (or particularly self-employed) when government is so slow to act.

Is there really enough food in the system? Eustice said the UK food distribution system was the most sophisticated in the world – and because in England at least, we are small and crowded he could be right – but what does this sophistication entail?

Distribution infrastructure is highly centralised through regional distribution centres (RDC’s). Margins are wafer thin both for retailers and transporters, so just in time ordering happens for everything and warehouse and shop capacity is used intensively, which is why transporters incur penalties for delivering late to RDC’s. That late delivery is likely to lead to shortages in deliveries to shops, sometimes, from personal experience, as early as later that day. Usually it works like a fairly well-oiled machine but a normally predictable sales based ordering system has supply lines that are often too lengthy or complex for unpredictable spikes – and there is, as we have seen, no slack in the system. There are limited numbers and categories of routes to market in the jargon. Nobody wants to hold buffer stock because it both goes out of date and also costs money.

The contracted out transporter normally gets leant on to rectify any hiatus but there is a chronic shortage of drivers – particularly after the decline in sterling and Brexit, which has seen many EU drivers go back home – and the average age of a lorry driver is in their fifties, with at least 4% being over 65.

To combine with this there is the prospect that illness or suspected illness will become more prevalent in food distribution chains, leading to additional staff shortages.

It is true that with all pubs and restaurants shut that there will be an opportunity for staff and probably some vehicles to transfer, but that will be a considerable challenge to arrange at short notice, particularly as almost all these companies are likely themselves to be facing existential threats and helping to reorganise someone else’s logistics for an uncertain period is unlikely to be first on their ‘to do’ list.

I’ve already suggested that efficiency is not resilience but nor, either is sophistication.

This sophistication seems to mean doing more with less, which means it all falls over when you have to do even more with the same.

Eustice’s rather repetitious and unconvincing pleas of ‘Don’t panic!’ are not for me especially reassuring, but rather more reminiscent of Corporal Jones.