It’s no surprise soaring costs have sent vegan brands to the wall

Last week I attended The Great Yorkshire Show, an event that’s close to my heart. For as long as I can remember, I have been visiting, working or – a long time ago –  helping my family show animals.

The show attracted high levels of media interest. I was interviewed as part of a special report looking at the economic climate for food and farming, and asked by various radio programmes to comment on the impact of rising food and production prices - particularly in light of ‘sausage inflation’. The average sausage price per kilo has risen sharply over the past year, according to ONS data, while a report by Which? shows the price of staple foods such as sausages, cheese and white bread has shot up by 80% in some shops.

I was also asked about the closing down of some vegan companies, given Heck’s recent reduction in its plant-based range, and if there is a loss of appetite for different types of meat replacement. The fact is, the impact of soaring food inflation has not only led to some good vegan companies going to the wall, it has also left British food shoppers shying away from new choices, and in particular vegan food.

I’ll be honest, I’ve had a lot of feedback, both positive and negative, about my comments – particularly from bosses of vegan companies. But the evidence is clear: growth has slumbered this year due to price increases of plant-based products. A lot of these companies are backed by VCs and Silicon Valley, and investments were made in very different times. Our feedback shows the core vegan consumer will continue to purchase, but those looking to try something new will probably wait until prices come down or they have more in their pocket, and stick to types of vegan sausages they know.

Our whole business is facing rising costs. The raw material price of pork and chicken is still very, very high and we haven’t got a crystal ball to see how the market will pan out. So where we can, we have made efficiencies, hence the reduction of our vegan range from over 20 different types to two. While we’re very much still in growth across both meat and vegan – in fact we’ve doubled the distribution of our core meat-free range – there is no denying this sector has had a major shake-up due to rising costs. The fixture is looking very different to 12 months ago.

Although food inflation has fallen from the 15.4% high recorded by the BRC in April, to 14.6% last month, we are still talking about historic levels. And things aren’t likely to ease anything yet. While grain prices are starting to go down, which will eventually filter into the supply chain, consumers are facing many other rising costs. So it’s important that brands take stock of their situations and plan ahead.

As a family-owned business, we control every aspect of our production and are able to keep a tight eye on our costs. Companies that outsource production or ‘brand slap’ on lots of different varieties of product can sometimes be blind to incoming crises until it’s too late.

I don’t have a crystal ball, but we believe it’s going to be at least 18 months until there is light at the end of the tunnel. We all need to work together to give better value for customers, as well as continually driving efficiency across the supply chain.