From key ingredient shortages to surging prices for traditionally inexpensive staples like milk, wheat and butter, the food supply chain is in a severe state of disrepair — and disarray. Just about everyone is feeling it, too, from the end consumer to grocery stores, restaurant chains and sole proprietorships, wholesale entities, farmers and distributors. In many respects, these challenges are a carryover from COVID-19’s impact, as 96% of restaurants encountered supply delays last year affecting foodstuffs that are essential to operations, according to a National Restaurant Association poll.
The persisting bottlenecks remain noteworthy, however, because the pandemic — for all intents and purposes — is over. But if that’s indeed the case, why are food supply chains still struggling so mightily? Here are a few contributing factors:
1. Soaring inflation
The rising cost of living has a way of affecting just about everything, since just about everything business related costs money. And the food industry is feeling the pinch, forcing companies to trim their productivity to remain profitable. As a separate survey from the National Restaurant Association points out, nearly 90% of respondents are spending more on business expenses than they were in 2019.
2. Hiring challenges
Inflation occurs for a variety of reasons, but at the root of it is too much money chasing after too few goods. In other words, demand is vastly exceeding supply. In the food industry, much of this stems from so many positions going unfilled. From grocery stores to restaurants to warehouses and more, just about every business with any affiliation to food is struggling with hiring. The truck driver shortage is also contributing to the food industry’s labor woes, since truckers are the ones who transport the equipment, ingredients and other materials the industry needs to produce the goods customers buy.
Plus, since customers have more channels to select from when it comes to how they buy food — such as e-commerce or curbside pickup or delivery via a third-party app service provider — fulfilling these orders requires that many more workers. Not having them creates inconsistencies that cause a chain reaction throughout the supply chain.
3. Problems with packaging
For convenience, ease of handling, safety, storage and hygiene, food needs to be properly packaged and bundled while getting ingredients and other edibles from Point A to Z and all the spaces in between. But just as certain comestibles are hard to come by, the same can be said for packaging materials.
This is particularly true when it comes to the plastics and aluminum cans needed for the bottling of beverages like soft drinks, water, juices and others. As The Washington Post reported late last year, 13% of beverage options that are typically sold in grocery stores weren’t available this past December. That compares to an overall out-of-stock range of between 5% and 10%. These bottling dilemmas are still in place today, which is why many alternative flavor options or choices — like zero calorie, light or caffeine-free — aren’t as widely available as the products brands are known for or sell the most of.
