Association calls for action on perishable product losses amid lockdowns

Australia’s lockdowns are causing million-dollar losses for food distribution businesses which is why an association is calling on government for urgent change.

The food industry, according to Independent Food Distributors Australia (IFDA), is faced with limited opportunities to sell products due to site closures across New South Wales, Victoria and South Australia. Also, there is an increasing risk that tens of thousands of tonnes of perishable goods will have to be disposed of when they reach their use-by-date.

IFDA Chairman, Richard Hinson, said the closure of Australia’s hospitality scene has a trickle-down effect on IFDA members who supply these venues.

Hinson has called on the Federal Government to consider introducing additional concessions for independent food distributors.

“Similar to the instant asset write-off tax concessions introduced for other sectors in 2020, small businesses that operate in the food distribution sector should have the ability to write off the cost of these perishable goods for tax purposes,” he said.

“We call on State and Federal Treasurers and Ministers for Small Business to support our request given the food distribution industry directly and indirectly supports tens of thousands of jobs across the country.

“Many of these jobs are now at risk which is a significant issue given nearly 50 per cent of food distribution warehouses are in regional and remote areas.”

Hinson also said a date for reopening, such as that provided to the construction industry in NSW, would also help IFDA’s members.

“We appreciate it is a challenge in the current environment but clear roadmaps provide the business community with a greater ability to plan and ultimately survive the current situation,” he said.

“Our members operate high volume and very low margin wholesale business models, with high fixed overhead expenses.”

The independent food distribution sector, according to IFDA, has a collective member purchasing power of $7 billion dollars.

“It supports local communities by purchasing products from thousands of local manufacturers, suppliers and farmers before on-selling and distributing that food to over 100,000 cafes, hotels, clubs and pubs,” said IFDA.

“It also provides food to many operations that are essential services including hospitals, aged care facilities, schools, childcare centres and military bases, all of which need a reliable supply of food to maintain operations.”