One of Wales’ biggest food companies has warned its 700 staff of possible job cuts due to the drop in hospitality trade during the coronavirus crisis.
Castell Howell Foods is considering job losses as the firm said weekly sales were down by 65% and it fears trade is “unlikely” to recover until 2021.
The Carmarthenshire wholesaler and processing company has entered into a period of consultation with employees.
The “medium to long-term viability” of the business was at stake, it said.
“Major events have been cancelled and it is likely that our core customers such as schools, pubs, restaurants, hotels, cafes and workplace catering will not open to full capacity for several months,” the company said in a statement.
“As the UK government’s furlough scheme is due to end in October, we regrettably need to start the consultation process with our staff so that further financial losses are minimised once government support ends.”
The company – formed in 1988 on a farm near Carmarthen – now has a £126m turnover, according to its 2018 figures, and is one of the biggest private sector employers in west Wales.
The firm is unsure of the severity of cuts due to the uncertainty in the hospitality sector.
“This depends on the extent to which our customers are able to resume trading,” the company said.
“We hope that during the consultation period, more customers will have the opportunity to resume trading and that a clear plan for the sector will become apparent. This will help mitigate the total number of job losses.”
The company, based in Cross Hands, said it expected cuts to come from a “combination” of voluntary and compulsory redundancies, as well as reduced hours.
Managing director Brian Jones said he “sincerely hopes” any job cuts will be “short term” and will be “recreated as and when the hospitality sector recovers”.