$5.5 billion food distribution peak body formed to counter supermarkets.
Three of the largest independent food distribution organisations in Australia have decided to form their own peak body to raise the profile of independent family-owned businesses, represent their members views and issues to Government and to counter the aggressive and opportunistic behaviour of the large supermarkets.
Independent food distributors believe there is a lack of acknowledgment or understanding by the states and the federal government in the role family-owned food distributors have played during the pandemic in providing food to essential services like hospitals, childcare facilities, schools, aged care, petrol and convenience stores and military bases, as well as continuing to provide food to commercial venues across the country.
Independent Food Distributors Australia (IFDA) includes Countrywide Foodservice Distributors, NAFDA Foodservice and The Distributors. Collectively, the hundreds of members that belong to the three organisations purchase and on-sell around $5.5 billion worth of product.
The newly elected Chairman of Independent Food Distributors Australia (IFDA) and CEO of Countrywide, Richard Hinson, says they had no choice but to protect the interests of their members through this representative body, “The pandemic has illustrated just how important it is to educate politicians, industry and the community on the critical role that these family-owned businesses play in our community and the contribution they make to Australia’s economy. We directly and indirectly employ tens of thousands of Australians”.
“The large supermarkets have been the biggest beneficiaries from the pandemic with Woolworths and Coles posting $1 billion net profits. Now, while small business continues to suffer, Woolworths has announced it plans to expand into the B2B space with a planned acquisition of PFD Foods. This will have a profound impact on independent food distributors. We will continue to lobby the ACCC and Governments to stop this opportunistic and aggressive move by Woolworths”.
Independent food distribution businesses lost up to 70–90 per cent of their revenue when commercial venues were forced to close their doors, leaving them with mountains of stock. They operate high volume and very low margin wholesale business models, with high fixed overhead expenses.
“Our members play an important role in the food supply chain purchasing product from local manufacturers and farmers in their local communities to then distributing that food to over 100,000 commercial venues (pubs, clubs, cafés, restaurants) across the country. Thousands of small to medium size regional suppliers, manufacturers and farmers support us and they too, employ many thousands of Australians. Nearly 50 per cent of our food distribution warehouses are located in regional Australia,” Mr Hinson said.
- JobKeeper – Job keeper has been the single most helpful support in keeping our businesses afloat during the lockdowns. Without a degree of flexibility in the criteria for JobKeeper, food distributors and cafés/restaurants, sports dining and conference facilities will be forced to lay off thousands of staff from March 2021. With your support we would like to see some modifications to JobKeeper that better reflect the current market conditions.
- Supermarkets – The large supermarkets have been the biggest beneficiaries from the pandemic with Woolworths and Coles posting $1 billion net profits. Now, while small business continues to suffer, Woolworths has announced it plans to expand into the B2B space with a planned acquisition of PFD Foods. This will have a profound impact on independent food distributors. We will continue to lobby the ACCC and Governments to stop this opportunistic and aggressive move by Woolworths.
- A National ‘Eat out to Help Out’ Scheme – We fully endorse the move by Restaurant and Catering Australia to implement a scheme where every household in Victoria would receive a voucher to spend at local eateries under a $650 million plan to save the state’s hospitality industry. This would see households receive vouchers of up to $100, after great success with similar initiatives overseas. We believe this should be expanded nationally. Why? Because a ‘consumption led recovery’ benefits all those involved in the food supply chain from local manufacturers, farmers, suppliers and, independent food distributors.
- FBT Tax – That the FBT tax be dropped on dining / business lunches for up to 2 years and potentially beyond? We need to incentivise business customers. This will assist in rebuilding dining establishments.
- Tax Deduction for stock losses – There have been huge stock losses due to the closures of commercial venues and bad debts resulting from forced venue closures. A 200 per cent Tax Deduction will help offset the losses experienced by Food Service Distributors.
- Banks – We would like the federal government to lobby the major banks for a further six months deferment on loans.
Independent Food Distributors Australia (IFDA)
Level 2, 100 George Street Parramatta NSW 2150