The Impact of COVID-19 On The F&B Sectors

Food and beverage companies across the world, from cafe and restaurant owners to big-name food manufacturers and retailers continue to feel the impact of COVID-19.

Social distancing, self-isolation and city-wide lockdowns have forced many establishments to close in countries across Asia, the US, Europe and the rest of the world. In the UK, US and Australia supermarket chains have started to enforce new rules to curb panic buying, while suppliers and factory workers have put additional health and safety measures in place to keep consumers safe.

As the situation evolves, the effects are causing a ripple throughout the wellness industry globally, with business owners and stakeholders calling for governments to provide support and guidance. 

Businesses are rushing to take steps to adapt their offerings in the face of this new landscape, one that will, without doubt, be altered irrevocably even after we make it out the other side.

Here are just some of the ways brands in the wellness sector, in particular across food and beverage, are currently being affected by COVID-19 and the efforts they’re making to adjust their operations, as well as keep consumers safe.

Restaurants and cafes
Restaurants and cafes have found themselves on the front line of the crisis, with many already being forced to close due to city-wide lockdowns or a drop in custom as a result of social distancing.

For smaller businesses especially, the impact is being widely felt. Last week, Ella Mills announced via Instagram that Deliciously Ella would be temporarily closing its deli in London following “a substantial drop in trade in a very short period of time”.

The company has also paused American and German product launches, telling its audience that whilst it was disappointing: “What really matters is keeping as many people as possible safe and healthy, supporting our doctors, nurses and hospitals and keeping as positive as we can.”

Where possible, businesses are continuing to offer or quickly develop take-out and delivery options, but following calls from the British Government earlier this week for the public to stay away from social venues, Kate Nicholls, chief executive of UK Hospitality, which represents the industry, said: 

“The government has effectively shut the hospitality industry without any support, and this announcement will lead to thousands of businesses closing their doors for good, and hundreds of thousands of job losses.”

Having already temporarily closed one deli site, Lily Simpson founder of healthy meal delivery company and deli chain Detox Kitchen — which operates in London, told Welltodo:

“This is honestly the hardest thing we have ever faced as a business. We are trying to do everything we can to ensure our staff are given hours to work at our commercial kitchen and at our Mortimer Street deli so that no one is left without support. But the government needs to act more quickly. It needs to release support packages fast so we can support our staff, our suppliers and our suppliers’ staff.”

Like many of her counterparts, Simpson is also taking matters into her own hands, in an attempt to support the community and her business.

Alongside its produce supplier of ten years, 2 Serve, the startup has created food boxes for consumers using goods usually sold to restaurants, such as vegetables, fruit, eggs and dry ingredients.

The Veg & Essentials Box, which feeds two people for a week at a cost of £40, is a way for consumers to support the industry in what are its most difficult times, while also catering to the high demand for online food shops, explained Simpson.

The brand has also increased donations to its charity partner Magic Breakfast, donating breakfast to a child who would normally go without, with every order (as opposed to just vegan orders) and will continue to offer 20% off all home deliveries going forward.

“We could not have predicted the impact that Covid-19 would have on our business,” Simpson told Welltodo. “But once we decided to close our Kingly Street deli, we knew that we would have to think of new ideas to keep the business going, and our suppliers, while also supporting the health and wellbeing of our community.”

In the US, nationwide chain Sweetgreen has also been quick to adapt, pivoting its business to a digital-only service, as well as working on implementing outposts for a few hospitals to support medical workers. LA-based social enterprise Everytable has also adapted its operations to offer pick-ups only, as well as setting up a hotline for the elderly who need food brought to their homes and healthcare centres and schools where foodservice has been disrupted. 

Read More: The Ethical Wellness Brands Driving Positive Change

DTC brands
For some direct to consumer businesses like British startup Mindful Chef, which delivers healthy meal kits directly to customers’ homes, the outbreak of COVID-19 has caused a spike in orders.

“We have seen a big increase in orders as customers become increasingly dependent on food delivery services,” co-founders Myles Hopper and Giles Humphries revealed.

“However, we have put a number of new processes in place for us to continue delivering Mindful Chef, whilst prioritising the safety of both our customers and team,” they added.

With an existing mission to make healthy eating easy, the duo acknowledged that at this time it is more important than ever that they provide their customers with everything they need to prepare a nutritious meal. And so they are also working with local suppliers to ensure they can continue supply as demand increases. 

“The safety of our customers and team is our number priority,” they told Welltodo.

“As such, we are doing everything we can to reassure our customers, including regular updates on how COVID-19 is impacting our service and communicating ways that can potentially support them at this challenging time — such as offering contactless delivery, multiple deliveries if they require more food and sending frozen meal ‘care-packs’ to family and friends.”

Elsewhere, global food delivery platform Deliveroo has also experienced a boost. The company which has switched to ‘no-contact service’ to protect its drivers and customers, has seen a huge surge in demand over the past couple of weeks.

And according to insights firm Nielsen, challenges arising from the spread of COVID-19 are only likely to accelerate the use of existing and new technologies and platforms such as these, “as consumers go into lockdowns, millions are forced to work from home and digital connectivity takes even more of a hold on everyday habits.”

In fact, Nicole Corbett, Nielsen Director of Intelligence argued: “This may be the unforeseen catalyst to assert broader, longer-term adoption of technology platforms and solutions.”

Supermarkets & grocery chains
Under immense pressure from consumers who have been stockpiling products, empty shelves are becoming commonplace in supermarkets and grocery chains around the world. Household items such as toilet roll, handwash, tinned goods and frozen food have taken the biggest hit, but as the situation continues to evolve individual chains have started to modify their business models.

In a statement from British supermarket chain Sainsbury’s, Chief Executive Mike Coupe said that in a response to requests from the general public the store would be setting aside specific time slots, both in-store and online, to accommodate elderly and vulnerable customers. It announced it would also be introducing further restrictions on the number of certain products customers can purchase at one time.

Most British supermarket chains have put similar initiatives in place, as have US chains including Target, Walmart and Whole Foods.

“We are setting aside time to help customers, who national health authorities have identified as among the most vulnerable to COVID-19, feel more comfortable shopping our stores and helping to ensure they are able to get the items they need in a less-crowded environment,” revealed Whole Foods Market in a statement.

Elsewhere to keep up with higher demand, some supermarkets are shifting staff around to help with food retail operations. And across the US, retailers including Kroger, Costo and Safeway are hiring in-store staff and delivery drivers to ease the burden.