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  • Level 1: Introductory

Chris Moore on isolation from world events

Updated Thursday 3rd March 2011

"You can minimise the impact of hikes in the price of oil"

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Copyright The Open University

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Copyright The Open University

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Chris Moore

I think the impact of something like that on our customers is fairly minimal.  As far as behind the scenes, in terms of its impact on our distribution costs, because obviously it’s a chilled supply chain, we don’t freeze any of our products, I mean that would have been a lot cheaper to do, because you'd only have to deliver to the store once a week.  But we have a perishable chilled product which needs to be delivered to the stores three times a week, whether it’s up in Inverness all the way down to St Austell.  So those kind of events obviously would impact on the fuel costs and on distribution costs, but those things are easy to deal with in the sense that we have intelligence road planning software, you can minimise the impact of such hikes in the price of oil.

But, in terms of other events, I mean the event that would impact our business is obviously anything that has to do with the commodities that go into our products.  Obviously the recent floods in Queensland would have an impact because a lot of the wheat harvest was basically decimated, and that always has a knock-on effect on the price in other markets.  So, if you have one or two markets that are suddenly producing a lot less wheat, then that obviously bumps up the commodity price for flour, and that’s obviously part of what we sell.  You’ve always got to try and make a connection between the big headlines and actually how’s that going to impact my business sooner or later, is it going to be two weeks, two months down the line, two years down the line?  But most of what comes out as news, particularly business news or weather news, will end up having some kind of effect on the business sooner or later.

(1’50”)

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