Cedabond commercial director Mark Kendall has been analysing the impact of the coronavirus crisis on the buying consortium, its distributor members and its suppliers.
He evaluated: “I think it’s fair to say that our industry has been one of the hardest hit and has therefore had to react quicker than most, which is why we have witnessed companies placing increased emphasis on smart working, cost savings and, perhaps most importantly, forward planning – these have been the buzz words.”
Cedabond represents over 130 distributors who, between them, offer a cross-section of products and services to all sectors of the market including restaurants, pubs, hotels, schools, hospitals, and the care sector.
Kendall added: “As a result, we feel that the figures we report are about as accurate a representation as it is possible to get when it comes to what is going on in the catering equipment supply chain. And the results, as one would expect, are mixed to say the least.
“Members reported a strong start to the year in Q1 and this was confirmed when Cedabond reported a 10% increase in like for like figures. Based on this our forecast for the tracked retro to be paid out by our suppliers for 2020 was also up, giving us a strong indication that the work we had put into further improving the Cedabond proposition during 2019 was delivering results in the form of increased membership, greater engagement and higher sales prior to lockdown. The upshot of all of this was that in Q1 Cedabond distributed over £16m to the supply chain via its unique combination of direct and central payments.”
He further reported: “The start of Q2 pretty much coincided with the introduction of lockdown and so, not surprisingly, Cedabond witnessed a 70% drop in business from its members as sales and orders from the end user market fell away significantly.
“What has been noticeable is how quickly our members have adapted their business proposition. With our assistance, as well as the introduction of new suppliers and new products, many are now concentrating on ‘return to work’ products: collectively member companies have distributed over 1m items of personal protection equipment (PPE), along with associated items such as screens, handwash stations and sanitising stands. This drive has been further enhanced by the government’s easing of restrictions on the retail sector, thereby opening-up more opportunities for members to provide these products and services to businesses looking to be Covid ready.”
Kendall detailed the buying group’s own measures throughout the crisis too: “Like many other companies we have had to look at our cost base and have taken advantage of the government furlough scheme, but the Cedabond office has remained open for business throughout and continues to operate as usual with the support of the board members.
“However, with opportunities for face-to-face meetings severely limited by the current travel restrictions and social distancing measures, contact with members and suppliers has been largely by phone or video conferencing. During these calls we have also sought the views and experiences of members and suppliers as they try to navigate their way through these unprecedented times successfully.”
One of these suppliers is Hoshizaki UK. MD Simon Frost commented: “We value our relationship with our dealers and we have done our best to support them through the coronavirus pandemic with actions that have included the extension of payment terms and lending a sympathetic ear to those dealers who have needed to look at plans to make payments against their accounts.
“Working with Cedabond is more than just part of the daily sales process. Being a partner with Cedabond is now a cornerstone of the Hoshizaki sales growth strategy. The work that the Cedabond team has undertaken in recent years, has shown a vast improvement in the way they support their dealer members and supplier partners. The communication and interaction are regular, and on point, and gives us as the confidence that Cedabond is looking after the interests of not only its members but its suppliers too. This has been demonstrated through Cedabond’s willingness to reject dealers and suppliers who do not meet the necessary terms of membership, when it could have been easier just to turn a blind eye.”
Another group supplier is Welbilt. UK and Ireland sales director Steve Hemsil analysed: “Being a Cedabond supplier has been a great comfort to Welbilt during the Covid-19 situation. We know that we have the ability to pick up the phone and speak to the likes of Mark Kendall in order to seek advice, discuss ideas or even just see how things are in general. Mark is often able to share information from the Cedabond community that is insightful and helps us to plan for the future. We can then all work together to overcome the situation that we are facing.
“With regards to payment we have had some great support from the dealers within Cedabond and the vast majority have been paying to terms. Once again having the support of Cedabond to facilitate payments between ourselves and dealers has reduced the number of queries and late payments that we received before joining Cedabond.”
Being a Cedabond supplier has also been important to Jestic during the Covid-19 outbreak according to sales director, Steve Morris: “Despite not being able to have face-to-face meetings we have been able to launch new products of particular relevance during the current crisis – such as our Moduline hydrogen peroxide atomiser and Venix hygiene stations – thanks to the e-shot service that Cedabond provides. This has enabled us to get information on these products out to dealers very quickly.
“In addition, Cedabond has proved to be an excellent barometer when it comes to understanding what is going on in the equipment supply chain in general. Communication from dealer members has been very good and even those who have not been able to pay their invoices in full have paid something, which gives us confidence. We would much prefer to know about any problems ahead of time – we are all in this together and want to help as much as we can.”
On the dealer side, Bruce Dance of IDS said: “Being a Cedabond member has been a great help through this Covid-19 crisis. We have received regular updates from them on the latest government policies, along with a very clear explanation of what this means for us. Via Cedabond we have also been receiving regular emails from suppliers who have been working through this difficult period. Of particular use has been the information about new products launched in response to Covid-19 which are obviously of great interest to our clients at this time.”
While Peter Kitchin, MD at C&C Catering Equipment concluded: “I think the information and contact that we have received from all three major industry associations – Cedabond, CEDA and the FEA – has been excellent. They have let us know about the furlough scheme, the details of working through Covid-19, getting back to work and generally letting us know relevant information and offering training, backup and advice.”