Containment causes a global fall of 22% of the sales of the agri-food industries in France

The barometer of the French National Association of Food Industries (ANIA) which examines the evolution of the economic and social situation of food companies since the beginning of the Covid-19 crisis delivers in its third edition a review of the confinement period. Nearly 2,000 companies have answered ANIA questionnaires since the end of March. The consultation launched from May 4 to 7, 2020 apprehends the “post-containment” economic situation, thanks to more than 600 responses from companies of all sizes, all sectors and all territories and the needs of food businesses in the short and medium term.

1 – The moment of truth for food companies

Companies are integrating the fact that the return to the previous situation is not for tomorrow and that they are at a crossroads with many of the equity capital strongly started, a consumer evolving in his choices and his circuits of supply. Some say they are currently playing their survival.

• • The cost of the crisis: a 22% drop in turnover in the food industry.

More than 70% of companies show a drop in turnover, more than 50% in 22% of cases. The sweet grocery and beverage sectors are the most affected. Overall, the drop in industry turnover over the confinement period was 22% compared to usual activity.

• • SMEs strongly impacted.

Between 70% to 80% of SMEs declare a decrease in turnover. The out-of-home catering markets being completely damaged, the activity of the companies which supply them (30% of the food industry) is in strong contraction.

• • The cost increases affect their profitability.

While inflation on processed food products is currently very moderate, if not zero, food companies are incurring significant additional costs. The price increases for raw materials, transport, maintenance or employee protection equipment have increased production costs by an average of 9% since the start of the crisis.

2 – Responsible and united companies and employees: controlled absenteeism and companies committed to the fight against food insecurity

• • A generally contained absenteeism.

The measures to support activity (continuity plan and guide to resuming activity) combined with the strengthening of social dialogue have made it possible to contain absenteeism at a low level. In May, the absenteeism rate fell significantly to 8.8% (compared to 12% at the start of April), while the activity rate rose in May to 73% (compared to 70% in April), showing once again plus the agility and resilience of food industry. Since the start of the crisis, it has stood at 75.4%.

• • Committed companies.

Since the start of containment, food companies have been engaged in the fight against food insecurity and have multiplied donations for a total value of € 135 million turnover.

3 – The need for a proactive recovery plan

• • Unbroken ambitions.

Industrialists estimate that the activity will take time to restart. Many investment projects have been canceled due to lack of visibility on the business or cash flow to ensure their financing. However, companies keep their initial ambitions intact and say for the most part that the crisis should not distract them from their objectives of modernization, sustainability and resilience.

• • A pressing need to save the stricken areas and continue investing.

The companies interviewed consider it necessary to set up an industrial policy allowing:

• • • the economic rescue of damaged businesses or markets (SMEs and out-of-home catering)
    • massive investments for the modernization of industrial tools essential for the sustainable revival of the sector.
    • support for ecological and digital transitions which would strengthen the resilience of the sector after the crisis.