The food and drink industry risks disaster if a bird flu virus hits because it is too efficient, experts have warned. 'Just-in-time' strategies favoured by retailers and manufacturers mean the supply chain is susceptible to breakdown in the event of an emergency such as a flu pandemic.
In a year-long study of business continuity management in the face of a crisis, researchers at Cranfield University found grocery retailers, wholesalers and manufacturers were all striving to keep stocks as low as possible.
One leading chain, they said, had set itself the goal of 10% stock reduction year-on-year, as a proportion of sales.
Others were similarly engaged, while even small independent retailers were working towards just-in-time strategies as they bid to compete with the supermarket chains' c- stores.
Suppliers, too, were employing the same tactic for ingredients and packaging.
But this approach is vulnerable to panic buying, according to the researchers, who have published their findings in a report, Resilience in the Food Chain.
"Consumers panic buy. Retailers and wholesalers do the same," they warn in the report commissioned by Defra. "Once drained of their stocks the supply chains take longer to recover because producers do not have the capacity to make up shortfalls quickly."
The Cranfield team spoke to 61 senior managers from 28 organisations.
Business continuity management was recognised as a "growing concern", they say, but add: "The reality is that only one company involved in this study was investing in contingent capacity, and then only after the business had been damaged by being too lean.
"The fundamental problem is that it is the very efficiency of the food and drink supply chains, under normal circumstances, that make them so vulnerable under abnormal ones."
The report also reveals retailers' views on what would happen in the event of a flu pandemic, which scientists say could occur if the H5N1 strain of avian flu learns how to leap from human to human. "Large store operators were expecting a sharp rise in demand for home delivery services and the possibility of store closures," say the authors.
Retailers also feared public disorder. Executives quizzed called for the police to maintain in-store security during a crisis and government to provide "clear guidelines to reduce hostility to store staff".
The report also says that for the industry to maintain supplies in the face of a national emergency, it would be necessary to suspend certain regulations. These would include legal liability and duty-of-care legislation so volunteers could staff stores and depots in the event of large numbers of staff being ill with flu.
The drivers' working hours directive would need to be waived, as would benefit rules, to allow part-time staff to work longer hours.