April - Beast from the East

06/04/2018

Over the past few years, the amount of online supermarkets and food delivery businesses have increased as the demand from consumers grows. As the snowstorm hit the UK, households continued to order their food shops online, putting pressure on the distribution centres to deliver in the extreme snowy and icy conditions. Many delivery depots were cut off by snow or the conditions meant it was too dangerous to put the delivery vans on the road.

One of the top online grocery delivery firms, Ocado reportedly took a £1.5 million profit hit following the “Beast from the East”. Ocado was unable to make some deliveries, which resulted in cancellations or delays. Some of the depots, including Bristol, Oxford and Kent were not able to operate at all due to the snow. Overall, the bad weather conditions resulted in a 1% loss of sales.

What are the solutions for protecting distribution businesses from the consequences of bad weather?

Adverse weather is unavoidable, and with that in mind, the ways to protect distribution business are limited. To help protect profits, a bespoke weather insurance solution can provide a custom-made insurance policy, which is triggered when an agreed amount of snow falls in a given time period at a particular delivery depot. The triggered claim amount will be equal to a pre-agreed sum representing the estimated loss of income caused by bad weather.

Don’t leave it until the next storm strikes…

To find out more about bespoke Tokio Marine HCC weatherproof insurance solutions, please speak to one of our underwriters today for more information on +44 (0)20 7648 1282