U.K. Grocers Ration Goods, Bulk Up Online to Deal With Virus
U.K. Grocers Ration Buying and Bulk Up Online to Deal With Virus
(Bloomberg) --
Two of Britain’s biggest grocers stepped up their response to the coronavirus pandemic as shoppers crowd stores, with J Sainsbury Plc rationing purchases and Wm Morrison Supermarkets Plc planning to hire 3,500 people to expand its home-delivery service.
In a sign of the growing strain that consumer stockpiling is putting on U.K. supermarkets, Sainsbury Chief Executive Officer Mike Coupe limited shoppers to three purchases of any individual grocery product and two of the most popular items.
“We are focusing all our efforts on getting as much food and other essential items from our suppliers into our warehouses and onto shelves as soon as we possibly can,” the CEO of the U.K.’s second-biggest grocer said in a letter to customers. “We still have enough food for everyone -- if we all just buy what we need for us and our families.”
Sainsbury also will shut fresh-food counters to help deal with the crush, while opening stores only to the elderly for one hour on Thursday to help them get the supplies they need before shelves are stripped bare.
The moves come as Morrison plans a hiring spree to help it cope with increasing demand online for groceries. The retailer revealed full-year results that were largely in line with expectations and deferred a special dividend to conserve cash.
Morrison shares rose as much as 3.7% early Wednesday in London, while Sainsbury traded as much as 6.7% higher.
Morrison is increasing home deliveries and has guaranteed pay for any sick and affected employees.
Growing fears about the coronavirus pandemic have led to extraordinary scenes in British grocery stores with people lining up outside shops before opening times and bulk-buying items such as toilet paper and pasta. There have even been instances of arguments and fights breaking out. Even though supermarkets and the government have given reassurances there’s enough food, stockpilers are putting immense pressure on suppliers and retailers.
Morrison CEO Dave Potts said the retailer is on a “crisis footing” and talked about the need to relax legislation to allow supermarkets to work together to ensure food supply. Speaking on a call with journalists, he also called for increasing the number of hours delivery drivers can operate, boosting van capacity limits and easing minimum-wage requirements.
The scale of the challenges facing Britain’s economy, particularly its retail sector, is growing as people work from home and self-isolate. Earlier this week the U.K. government announced a raft of measures to help small businesses.
The country’s biggest supermarket operator, Tesco Plc, previously introduced some rationing. It has also changed its trading hours on most of its large stores from 24 hours to only operating between 6am and 10pm to help staff restock shelves.
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