FWD column: We are the vital link
FWD’s latest economic report reveals how the wholesale distribution sector is the true cornerstone of the UK economy and communities, explains CEO James Bielby
As the trade association for food and drink wholesalers in the UK, FWD works tirelessly to represent, promote and bring the sector together.
This month sees the launch of our latest economic report, which brings all three of those vital workstreams into sharp focus. The report was shared with Daniel Zeichner, Minister of State (Minister for Food Security and Rural Affairs), along with other MPs, senior wholesalers and suppliers at FWD’s annual dinner at the House of Commons.
The new research demonstrates that the wholesale distribution sector is not just another cog in the UK’s economic machinery, it’s a cornerstone of our economy and communities. It serves as the vital link between large manufacturers and the independent retailers, caterers and foodservice providers that are the lifeblood of our towns and cities.
RESILIENCE
Our report is timely given the commitment of Defra officials to produce the national food strategy, which aims to ensure the UK’s food and drink industry is not only resilient but is able to thrive. The key findings from the report showcase exactly this.
From 2023 to 2024, the food and drink wholesale distribution sector directly contributed £3.5 billion to national output in gross value added and employed around 77,000 people. What’s more, the sector supports a quarter of a million jobs through its supply chain, contributing £18.6 billion in gross value added.
Wholesale distributors act as the backbone of the value chain, generating £33.6 billion in turnover. Remarkably, £17.5 billion of this comes from sales to independent retailers and £13.4 billion from sales to foodservice providers. By doing so, the sector indirectly supports around 1.2 million jobs and £33 billion of value added in these downstream industries.
When we look at the entire value chain, the numbers are truly staggering: almost 1.5 million jobs supported and a £57 billion annual contribution to the UK economy. These figures are a testament to the vital role of wholesale distribution in enabling a thriving food and drink sector, which supports all our lives on a daily basis.
But alongside these achievements, the report also identifies significant challenges facing the sector. Supply chain disruptions, rising costs, regulatory pressures, and not just geo-political challenges but domestic political challenges too. Wholesalers are navigating an increasingly complex environment.
PENALTIES
One of the challenges that wholesalers are facing is the planned reforms to business rates. While we believe that reforming the outdated business rates system is long overdue, the new plans burden wholesalers that operate large warehouse depots with an unfair and unintended penalty under plans designed to target online giants.
FWD is currently making representations to government to call for food and drink wholesalers to be omitted from any changes to business rates which would penalise our members who provide food and drink to the nation. It’s clear that the food and drink supply chain is under huge financial and regulatory strain right now.
Some of these pressures include environmental taxes such as extended producer responsibility and the deposit return scheme, along with fundamental reforms to employment laws, increases to national insurance contributions and ongoing issues such as wholesale crime. Addressing these issues is not just about supporting an industry; it’s about safeguarding the communities, businesses and livelihoods that depend on it.
FWD has stressed to government that the sector needs to work together, to explore how we strengthen our food and drink supply chain. Whether through policy support, innovation or collaboration, there is much we can do to ensure wholesale continues to thrive as a pillar of the UK economy.
business rates Daniel Zeichner MP economy FWD column Government James Bielby research wholesale
