Wetherspoons’ Steak Shortage Raises Supply Chain Risk Issues

What seemed at first to be a somewhat humorous news story last week turned into something more serious for many businesses. It first hit the headlines when people took to Twitter on Tuesday evening to complain that Wetherspoons Steak Night didn’t have any … steak. A bit of a fundamental issue, you might say.

Wetherspoons is not only a huge pub chain but also one of the largest restaurant groups in the UK, and serves no less than 90,000 steaks every Tuesday during its Steak Club promotion, offering remarkably low prices, good value and a very good choice of real and cask ales.

According to the Sun, A Wetherspoon spokesman Eddie Gershon said: “We have had a supply issue with our pubs. Currently rump steak, sirloin steak and gammon steak are not available, but we hope to resolve this soon. We apologise to our customers for the inconvenience.”

So this was a “supply problem” apparently, but then as other catering and restaurant businesses said they had similar issues, it became clear that the source of the problem was the firm Russell Hume, a key supplier of meat to these industries. Russell Hume is Derby-based, privately owned with a turnover of around £130 million and a reputation for operating at the quality end of the meat supply market.

There was, according to the firm, no questions of meat being unsafe, but rather this was a “labelling issue” and the product recall was just a precautionary measure.  Well that’s fine, but you might argue that the basis of the horse meat scandal from a couple of years ago was “labelling” – not telling us we were eating horse! There is NO suggestion that the meat in this case was anything other than beef steak of course.

Wetherspoons, despite their low prices, place an emphasis on quality, and insist their beef is “supplied through farm-assured schemes with full traceability”.  But the plot then thickened when the Food Standards Agency (FSA) said that they had found poor hygiene practices at a Russell Hume facility on January 12th, with "serious non-compliance with food hygiene regulations", which led to inspectors investigating all their sites.

The FSA also said, "Russell Hume were unable to demonstrate compliance with food hygiene rules at its locations, so we have stopped any product from leaving their sites until the business can provide assurances that they are complying with the relevant legislation, and that they are producing safe food”.

Later information suggested it was an issue with best before dates. If that is "all", then we can't help but think that the FSA action looks pretty extreme - we would not be surprised if this ends in court, particularly if severe damage is done to Russell Hume's ongoing business.

In the meantime, Wetherspoons and others are looking for alternative suppliers, as well as substituting roast cauliflower steak and quinoa salad for the 8-ounce sirloin. Just as tasty of course …

But joking aside, this brings provenance and supplier quality in the food industry back into the spotlight. It also raises interesting questions again about supply chain risk. Should Wetherspoons have alternative suppliers for such an important range of purchases? Was a “single-source” approach sensible? What was the contingency plan for such an event – and does Wetherspoons have a formal supply chain risk process in place? If they didn’t before, they probably will have soon!

However, they probably got more free publicity out of this than any income they lost on Tuesday. And it doesn’t look as if they have done anything wrong, so there shouldn’t be any lasting effect – the same may not be true for Russell Hume.

Finally, if you want to understand more about supply chain risk, here are the useful short briefing notes we wrote on the subject last year (in conjunction with supply chain risk platform providers risk methods). You can download them free of charge via the links provided.

The Most Effective Ways to Mitigate Supplier Financial Risk

Corporate Image & Compliance at Risk: How to Mitigate the Hidden Risks Lurking in Your Supply Chain

Natural Disasters – How to Mitigate Unavoidable Risks: Supply Chain Risk Briefing

“Man-Made” Risk – Different Risks Require Thoughtful Strategies: Supply Chain Risk Briefing

Geo-political Risk – An Informed Global View Is Essential: Supply Chain Risk Briefing

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