One of Wales’ largest food distribution companies has had to lay off 52 members of staff amid the ongoing coronavirus pandemic.
Castell Howell entered a period of consultation in the summer and the Carmarthenshire-based firm said the staff left through a combination of voluntary and compulsory redundancy.
Nigel Williams, Castell Howell finance director, said: “The early effect of the pandemic on the food service and hospitality sector meant that weekly sales decreased by 65%. Consequently, a decision was taken late June 2020 to enter a period of staff consultation.
“At the time, the future of the sector was bleak and, despite our efforts to increase sales to other channels, there seemed little hope of a reasonable recovery over the summer months.”
The Chancellor’s Eat Out to Help Out scheme and the reductions in VAT proved to be a significant and welcome stimulus for the company, with August sales increasing to 95% of its typical sales. The September sales were described as “reasonably strong”.
During the summer, while Castell Howell was selling far fewer high-end products than normal, it expanded its bulk and retail food supply.
It also set up a click and collect service from its Cross Hands headquarters, and helped redesign a frozen food operation at Authentic Curries and World Foods – a company it part-owns in Hirwaun. The wholesaler also provided vital support for the NHS and for councils, and manufactured gloves and aprons for health and care workers.
Ahead of the firebreak lockdown, Castell Howell was a co-signatory with SA Brains and the Welsh Independent Restaurant Collective (WIRC) on a letter to Welsh Government ministers asking for clarity on proposals to impose a “circuit-breaker” shutdown of hospitality.
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Mr Williams added: “As local lockdowns started to take grip in south Wales and subsequently north Wales, October sales slipped to circa 70% of typical sales. The future remains very challenging as we see the end of the furlough scheme, the introduction of the Job Support Scheme allied to the two-week firebreak and uncertainly over Brexit and potential tariffs on EU food imports.
“The industry hopes that the two-week firebreak has the desired effect and ensures the hospitality sector can plan towards a different type of Christmas with something approaching confidence.”
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Last week a north Wales food distribution company said it feared the firebreak would put jobs at risk.
Andrew Foskett, the joint chairman of Harlech Foodservice, based in Criccieth and Chester, said the firebreak, as well as the rolling local lockdowns in England, will cost his firm £2m.
Mr Foskett wrote to the Welsh Government asking for an extension to the Job Retention Scheme (JRS) with companies receiving 80% of staff pay and being allowed to move staff in and out of furlough depending on demand.
He described the Job Support Scheme that replaces it as “unworkable” and of no benefit to companies like Harlech Foodservice because they were not legally being forced to shut.