Firms more confident than five years ago
Food and drink sector ‘shrugs off’ Brexit concerns
Scotland’s buoyant food and drink sector is shrugging off Brexit concerns and is set to hire more people, raise investment and push for more exports.
Research carried out in the weeks immediately after the EU Referendum found firms were more confident in growth expectations than a year ago.
A survey from Bank of Scotland found that they expect to increase turnover by an average of 24% over the next five years.
Half of all firms said the EU Referendum result had caused them to raise their business growth estimates.
Scotland’s food and drink sector is expected to add 14,000 jobs, taking the total to 48,000 over the next five years.
The survey strongly suggests that the sector will be able to build on the momentum of recent years, which has seen Scottish food exports surpass the £1.1 billion mark for the first time, with total food and drink exports valued at £5.1bn.
More than two thirds (69%) of all firms say that they are investing or planning to engage new international customers over the next five years, 7% up on 2015.
Western Europe (48%) remains the most favoured region for international investment, followed by the Middle East (42%) and North America (38%).
Complexity of logistics is cited as the biggest factor stopping firms from seeking out new international customers. This was identified by 44% of all firms, and shows little improvement on the 2015 results suggesting that understanding how to export continues to be a challenge for firms.
Capitalising on provenance
Taking advantage of the good reputation of Scottish produce in international markets scores particularly highly in the latest survey.
Some 87% of all respondents say they are already capitalising on the reputation of Scottish produce, against 71% previously.
James Withers, chief executive at Scotland Food & Drink, said: “The outcome of the EU Referendum is causing some uncertainty around the industry’s future workforce and how we trade with Europe, but change is nothing new to the sector, and there will be opportunities too as we build new markets for our produce.
“Food and drink has been a bright spot in Scotland’s economic story for nearly 10 years now. This report is further evidence that we have all the ingredients for that to continue.”
> Scotland’s food and drink industry has today launched an ambitious ‘action plan’ to boost productivity in the sector.
The call to action has been made by a coalition of key public sector and industry bodies working through Scotland Food & Drink. They want to see more collaboration in the sector.
Three years ago, the Scotland Food & Drink Partnership launched a revised strategy for growth with the ambitious target of an industry worth £16.5bn by 2017.
Food and drink is one of the star sectors of Scotland’s economy and is on track to meet this target as figures announced this week show the industry is worth a record breaking £14.4bn.
“In order for us to continue on this trajectory, we need a productive industry which can compete with UK and overseas businesses,” said the industry body.
“Many food and drink businesses are already highly productive, especially within the whisky industry, but there is room to do more.
“Collaboration is the key to the future of the Scottish food and drink industry and by working together the Partnership have produced a call to action of where we need to focus our productivity support.”
The call to action, launched at Ivan Wood & Sons as part of the SMAS Conference and during Scottish Food & Drink Fortnight, lays out a clear road map for the industry and is expected to help cement Scotland’s reputation as a Land of Food and Drink throughout the world.