Co-op boss warns of Christmas shortages as supply chain crisis boils over

On the day the Co-op reported a dip in profits in the first half, Murrells said the ongoing global supply chain issues combined with an acute lack of HGV delivery drivers in the UK would also affect profits in the second half of the year. 

When asked what this would mean for availability at Christmas, Murrells said: “On availability, come to the Co-op and you’ll get what you need as you have always done and enjoy a great Christmas. You might not get it in every pack size, but if you want your beef joint or your turkey, or your Brussels sprouts, then you will absolutely get them.”

Murrells also said global supply issues and added Brexit red tape was contributing to food inflation moving into positive territory. 

“You might not get it in every pack size, but if you want your beef joint or your turkey, or your Brussels sprouts, then you will absolutely get them”

Steve Murrells, chief executive, Co-op

“We’ll try and absorb as much of that as we can, and also support those that supply the Co-op so they can in turn support our British farmers. But this will start now to move [in a positive direction].”

In a bid to ease the disruptions being caused by the HGV driver shortage, Co-op Food boss Jo Whitfield outlined a number of ways the retailer was looking to address the issue, including through its “Warehouse to Wheel” programme and apprenticeships. She also said the Co-op was offering drivers “holiday pay and pension contributions”. 

“We’re not really a fan of the signing-on bonuses that we’ve seen other [grocers] do,” she added.

“We think the right thing to do is to retain and invest in the fabulous people that have been helping us over the course of the pandemic for the past 18 months and ensure that they stay with us.”

Values versus Amazon tie-up

Murrells was also forced to defend the Co-op’s online partnership with Amazon, following criticism from some corners, including the shopworkers’ union GMB. 

Andy Prendergast, national officer of the GMB, said: “It’s really disappointing to see a company with a proud ethical heritage like Co-op teaming up with Amazon: a tax-evading multinational with a horrifying health and safety record.

“Amazon has made billions throughout the pandemic and pays virtually no tax. Bosses won’t even recognise a union to improve the health and safety of their beleaguered workforce.”

While Murrells said it wasn’t his business to “defend Amazon”, he said the US giant had shown at home and abroad that it wanted to be a “real force for social good”. 

“A successful Co-op can’t live in isolation”

Steve Murrells, chief executive, Co-op

He also said the partnership would allow for more of the Co-op’s ethically sourced products to get to more customers. 

“A successful Co-op can’t live in isolation. Our successful collaboration with Deliveroo has enabled us to get our product to more homes and serve more customers and members,” he said. 

“When we look at how customers and our members trade with Amazon, they’re doing it more and more often. Today’s announcement will actually allow customers and members to judge whether or not they see our link up as a successful one.”

The Co-op’s Whitfield said the trial with Amazon “would be very much focused on its online platform”, but didn’t rule out the possibility of Co-op products finding their way into Amazon Fresh cashierless stores in the future.