Francesco Pugliese, CEO of Conad
There is a current of thought according to which large retailers are the winners of the pandemic era: all at home during the lockdown, many at home even now with smart working.
Let’s stop it right away. Here there is little to rejoice. There is a patient and we are still stuck in the analysis. In the last three weeks, with the same sales network, consumption has been falling compared to the same period last year. And then work remotely. Not true that it benefits us. The pieces sold increase, not the value of what we sell, which actually goes down. If the restaurant channel is already going as it is, there will also be damage to large retailers. Because it buys quality products, which have a higher receipt. We live in a system so intertwined that there are no winners and losers. If the economy is already losing all the supply chains, including ours.
We cannot avoid asking you about the Antitrust investigation on food prices during the lockdown: could speculative phenomena have occurred?
You will see that they will not be demonstrated. Two things happened: with the frosts in January and February, the prices of some fruit and vegetable products increased due to a lack of supply. And the same is happening on durum wheat. Worldwide stocks are running out. We are in full harvest, the storms are worsening the yield of the crops and the quality of the same: an increase in the prices of products such as bread and pasta that will bring inflation will be inevitable.
Francesco Pugliese has just been confirmed at the helm of the consortium of Conad cooperatives, which became market leader in 2019. The manager has just participated in the general states promoted by the government where he has given some indications on how to relaunch the sector he represents.
I must be sincere? We are stuck in the analysis and need a diagnosis quickly. We are there with a sling bar to imagine a rebalancing of the agri-food chain without imagining what future we are building and what economy we want for us and our children. Out of 100 euros in sales to the sector, only 5 remain. The agri-food sector is a historically low-margin supply chain. Less than 1 euro goes to agriculture, 1 euro goes to us distributors, 2 to the processing industry, the last euro to catering. Here we must raise this margin to bring work, investment and therefore consumption.
It is a chain made up of opposing interests and with the crisis in which we have plunged, tensions intensify
Exactly. We must have an idea of a country. First: reduce taxation on the job. We have higher costs than international competitors. And household incomes are stagnant. There is an impact on consumption. The pandemic crisis increases inequality. We cannot act only with the narcotic drug of the state assistance of bonuses and layoffs. Who in the cash register, a fundamental tool during an emergency, still receives 20% less and the account is transferred net on consumption. We, on the other hand, must free up resources for business investments otherwise we will prolong the agony of workers who at the end of phase 2 risk leaving the production cycle.
Yes, but Europe has already ruled out that the money from the Recovery Fund can be used to reduce taxes. This is money that must be invested to recover competitiveness
Of course, but if we combine the intervention with a streamlining of the state machine, the savings can be used for a fairer and redistributive tax. We have light taxation on annuities, like real estate. the time has come for a tax reform to rebalance taxation. Leasing contracts in large retailers and in commerce must be completely rethought. Here we have real estate funds that have a 9% return on invested capital based on contracts that no longer stand.
We are in a moment of private investment at the stake, and public ones have been for years. The impression taken on the States General?
Little attention. We must reactivate the supply chains that are important to us, creating jobs and investments. We are a manufacturing country. Think about the automotive. We have the oldest car park in Europe, we have to give incentives for scrapping cars € 4.3.2. It is not possible to incentivize only the electric and the hybrid. Most families can spend less than 10,000 euros on a car. With this incentive system, we give public money to the cooperative director and not to the cashier.
On food ecommerce the time has come to invest more: Nielsen tells us that even in phase 2 there is a boom in online orders
The pandemic has accelerated an ongoing trend. We will reach 5% of the total amount within 2-3 years instead of 5. But the home delivery service of the shopping must incorporate an additional price because otherwise the cost becomes unsustainable. We are inevitably investing in this area, but IT skills on the market are often lacking. An update of the training and academic programs would be needed. Is anyone taking care of it? It seems to me that lessons from home have heightened the inequalities between those who have a PC and an adequate connection and those who do not. We give the 500 euro bonus to those in middle school, without waiting for 18 years.
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