All importers to the UK are currently facing the perfect storm of increased bureaucracy thanks to Brexit, Covid’s continuing impact on the supply chain and freight delays. These issues could be even more acute for specialist catering equipment spares suppliers, as they rely on sourcing parts from around the globe. So how are they managing these challenges?
At Cannock-based First Choice Group, head of marketing Julian Fisher acknowledged: “It’s certainly has been a challenging start to year with the Brexit agreement being finalised so late in 2020. Our logistics operational and procurement teams have worked tirelessly with all our manufacturer partners and multiple courier solutions make the transition away from the EU as smooth as possible.
“Our policy to maintain and develop our stance as the UK largest parts, accessories and consumables stockist certainly has helped in the interim period whilst couriers are automating their process.
“The stocking optimisation and algorithms we work on means we and our suppliers benefit from bulk importing to reduce multiple paperwork and administrations at all links in the global parts supply chain.”
He further detailed that early in 2020, First Choice set up a specialised Brexit team which was multi-faceted and inter-departmental. Specialists in ISO quality management, logistics, finance, purchasing, customer experience and marketing met weekly to advise, review, resolve and communicate and changes in the supply chain which would potentially affect its customers and suppliers.
Fisher underlined: “We focused our communications regarding potential changes to customer regions that are most affected e.g. Northern Ireland and Eire, and are currently in the process of automating courier inbound and despatch portals to make any potential customs clearance more efficient and effective.”
In terms of stocking levels, he detailed: “One of our key differentials is our UK stocking policy, which has been enhanced by the growth in more and more OEM manufacturer exclusive partnerships, resulting in upstocking for all key parts for all brands.
“During the last lockdown we also expanded our distribution centre by installing four new auto storage lean lift towers to expand and store our stock levels to now well over 50,000 varying part lines, which equates to a parts stock value of approximately £8m.
“Having OEM stock available and efficiently same day shipped, up to 7pm daily, in a centrally-located UK operation, has never been more vital for our customers and supplier base.”
Over at Commercial Catering Spares (CCS), which is part of the international REPA Group alongside GEV and LF Spares, MD Jonathan Booth commented on the choice of whether to bulk import spares. “There does not seem to be one standard approach to this; initially the delays were caused at customs with goods being held up, but that has now relaxed a bit.
“Some suppliers have changed their delivery schedules from every day to only twice a week, and others are grouping deliveries together. As a spares stockist in the UK this has helped us as we can offer next day delivery. As a general rule we are now placing more bulk orders to increase our stock levels further and to reduce the additional import charges where we can.”
Continuing the stocking theme, he confirmed: “We, the REPA Group, have maintained our stock levels consistently throughout the year, and as things are beginning to relax in the UK, we are further increasing our stockholding again to give more flexibility on next day delivery.
“For our key European warehouses in Germany and Italy we are also now increasing our stock levels on two fronts, firstly, with an increasing number of OEM agreements we have some large additional stockholdings, and secondly with our focus on diversification, not just on cooking equipment but also in refrigeration, coffee, vending and household spare parts. We are increasing our availability of spares in all these areas.”
Booth believes that the REPA Group benefits from its seven warehouses located around Europe. Explaining how the end of the Brexit transition period has impacted operations, he said: “In the first few months we suffered delays on imports and exports to Northern and Southern Ireland, caused in part by customs but also by the carriers who seemed to be as much in the dark as everyone else. This meant direct deliveries from our warehouses in Germany and Italy were affected, as all goods that came into CCS in the UK had to be shipped out again to customers.
“Another issue that we faced with our LF customers in the UK was that they were getting additional invoices from carriers and were being asked to set up deferment VAT accounts and sometimes faced additional delays. Happily, we are now invoicing these customers through CCS so we can cover the carriage costs and use our own deferment account to simplify things as much as possible for our customers.
“Thankfully, after the initial confusion things now seem to have settled down. Yes there are some additional charges, but not huge, and shipments from our GEV warehouse in Germany and LF warehouse in Italy are now back to next day or two day delivery which is what we need for the fast supply of spare parts and a service our customers can rely on.”
At Brackley-based Caterparts, national sales manager Robin Coates detailed the firm’s importing experience this year: “We initially put in some large orders to our European suppliers; this was due to the initial uncertainty of supply into the UK. Since this time we are continuing to purchase from our suppliers in Europe on a regular basis with not too many issues.
“The only real difference since the end of the Brexit transition is our order quantity is slightly larger. We have increased some of our stockholdings to try and build a slight buffer to accommodate any disruptions due to transportation.”
He added: “The mid-summer period adds to the pressure on spares suppliers, as many major European manufacturers shut down their operations for between 2 and 4 weeks. While they may keep their spares operations open, it is with skeleton staff. The result is that to minimise the potential of being out of stock, additional stock has to be purchased in the weeks leading up to the shutdown. With Caterparts’ 30 years’ experience of supporting the service industry, the historic sales data aids the ability to stock the correct parts over this period.”
Catering Insight asked major spares suppliers which parts have been flying off the shelves recently. At CCS, MD Jonathan Booth reported that demand did fall during lockdown, but the Heywood-based company ensured that the parts required in hospitals, care homes or other frontline kitchens were always in stock, to avoid any delays. He revealed: “The good news for the group was that coffee, vending and household sales actually increased during lockdown as people worked from home, wanting more semi-professional type appliances.
“As things have opened back up again we have seen a lot of OEM parts, switches, thermocouples and some gas taps as service engineers carry out gas tests prior to opening up. In June our volumes have gone up again as more equipment is turned back on. The mix is now similar to what we have supplied in the past.”
At First Choice Group, marketing manager Julian Fisher detailed: “We have seen a move to a more proactive approach to foodservice maintenance with the growth of Preventative Planned Maintenance (PPM) parts and van stock packages being consistently ordered now.
“Hygiene has never been more prevalent too with a growth in the repeat purchase of essential kitchen and equipment OEM cleaners.
“Water filtration for clients’ machines is growing as customers look to extend the shelf-life of their equipment when restarting their units and kitchens for what we hope is a more permeant period now.”
Elsewhere, competitor Caterparts has seen a correlation between economic buoyance and sales of spares. National sales manager Robin Coates said: “When the national economy is in the doldrums, many end users make the difficult decision to repair, rather than replace, capital equipment. Their operating costs switch from capital spends to maintenance budgets. The upside to spares suppliers is that there will be many more pieces of equipment that will eventually require spare parts.
“An additional future advantage for spares operations of a more buoyant economy is that many older pieces of equipment will be disposed of, with the reduction of the problems associated with trying to source spares for older equipment.”