Booker

There can be no disguising the hit that the UK’s biggest grocery wholesalers have taken in the pandemic. From delivering collective profits of almost £500m, they made a £21m loss – the first loss in the Big 30’s history.

And the losses at Brakes, covering only four months of the pandemic, are of particular concern: from an already slim £25m profit, losses of £235m represent a £260m reversal. It’s survived thanks to parent company Sysco. But it’s clear covid has had a coruscating effect. And it’s anyone’s guess what Sysco does next, especially with Hugo Mahoney off to Samworth Brothers.

The good news is, while others on the foodservice side have struggled, they are down but definitely not out. It shows the resilience of the sector in the wake of the pandemic. In fact you have to go back to 2018 for a major wholesaler to go bust (two, actually, with Conviviality following Palmer & Harvey). And as the market opens up the hospitality trade is coming back.

The losses also come with a health warning as Tesco no longer reports Booker’s profits. While Chef Direct was hit hard, that was offset by gains on the independent retail side, while colleagues also supported Tesco’s online deliveries. Assuming a contribution from Booker similar to the £250m the previous year would instantly make the table look a lot more healthy, with Brakes accounting for the lion’s share of the remaining shortfall.

On the other hand, that £250m profit shows how powerful Booker is in the sector. From £5.3bn when it joined forces with Tesco in 2017, sales will easily pass £7.5bn in 2022, thanks to the Best Food, picked up from Bidfood for a song acquisition just before the pandemic, and with the rest of the business “flying” in the words of CEO Ken Murphy: so busy in fact that it’s struggling to keep up with demand.

The acquisition of Booker has been truly a masterstroke to rank alongside the launch of Clubcard in Tesco’s evolution. Morrisons, Sainsbury’s, Waitrose and – via a reverse takeover – Asda, are all trying (or have tried) to grow their wholesale business, but none have been able to plug Booker into the grid. When we look at Tesco’s UK performance it’s often through the lens of market share figures, but Booker is a jewel in its crown – and a thorn in the side for the rest of the market.