- McDonald’s and Nando’s are among the UK retailers hit by supply chain shortages.
- Experts say the UK is short 100,000 truck drivers, leading to long delays.
- It could end up making products more pricey for the consumer, they say.
- See more stories on Insider’s business page.
McDonald’s pulled milkshakes from its menus across UK restaurants this week, citing supply chain issues. The week before, popular restaurant chain Nando’s said it would temporarily close 50 stores because it couldn’t get hold of its main ingredient, peri-peri chicken. And in July, German confectionary giant Haribo said it was struggling to get its sweets to shops in the UK.
These are just three examples of retailers and foodservice companies hit by supply chain issues. Similar issues are common across the US too, but experts say that the UK is dealing with unique challenges thanks to a massive truck driver shortage.
This shortage, partly fueled by the pandemic and partly by the UK leaving the EU, could lead to long delays and, ultimately, price increases for customers, experts say.
According to the Road Haulage Association (RHA), the UK is currently short 100,000 trucker drivers. Pre-Pandemic, there would have been around 600,000 drivers in total.
While a lack of truck drivers predated the pandemic, the situation has only become worse.
Drivers that had come over from mainland Europe went home during the pandemic and never returned. New immigration rules in the wake of Brexit also made it harder for these workers to come and go – tax changes also impacted self-employed drivers.
The pandemic and ongoing lockdown also meant that many would-be drivers were unable to join the industry because they couldn’t take the proper driving tests.
It’s the perfect storm.
“This means the available pool of drivers are getting booked up extremely quickly, and prices are naturally starting to increase,” Alex Hersham, cofounder and CEO of Zencargo, a UK-based logistics company, said in an email to Insider.
To combat this, the UK government temporarily eased restrictions on the number of hours drivers can work. It’s also testing extra-long trucks that can deliver more goods at one time, and so require fewer trips and fewer drivers.
Retailers themselves are also getting creative in how they attract workers to drive their delivery vans.
Grocery giant Tesco is offering £1,000 ($US1,168 ($AU1,597)) bonuses to drivers who join before September 30. John Lewis said it would raise its lorry driver salaries by up to £5,000 ($US5,843 ($AU7,989)) to keep them motivated.
But experts say these trucker shortages are likely to lead to long delays across the entire retail sector, and consumers could see prices creep up.
“Consumers could potentially face weeks of delays when ordering products online, whether it be furniture, cosmetics, clothes, or bicycles, with a number of haulers already running out of capacity for the whole of August,” Hersham said.
He added: “We’ve all seen footage on the news of empty supermarket shelves … but we’re already seeing this spread from supermarkets to other retailers, and if businesses don’t start planning, they could wind up in a similar situation.”
Ramsey Baghdadi, an analyst at GlobalData, told Insider that retailers and foodservice providers should start to invest in tech that increase supply chain visibility, such as blockchain, to prepare.
“These technologies will help staff to be informed about the product delivery in real-time. This will allow companies to plan ahead of shortages due to increased traceability and avoid customer distrust,” he said.