It’s no secret the COVID-19 crisis has been negatively impacting industries across the United States. Unfortunately, the food and beverage industry has been hit particularly hard as restaurants have been forced to close across the country to flatten the curve of the new virus.
But just how has the virus impacted the industry and how can businesses expect to adjust in the aftermath of the COVID-19 crisis? Here we’ll dive into the latest industry insights.
COVID-19 and Packaged Food and Beverage
The short-term impact of the virus on the food service and packaged food industries are easier to identify than the long-term impact. Restaurants have taken a significant toll in the industry whereas packaged foods have come out on top. The biggest challenge packaged food businesses are seeing is the ability to keep up with demand.
According to a Research and Markets, Packaged Food Market is quickly reaching its pre-COVID levels and a healthy growth rate is expected over the forecast period driven by the V-shaped recovery in most of the developing nations.
Key strategies of companies operating in Packaged Food Market Industry are identified as showcasing their contactless manufacturing and delivery methods, highlighting USP statements, focus on product packaging, and increased the presence of products on online platforms.
The food industry is set to experience a few changes in 2021 due to the increased consciousness of consumers in selecting food. This inclination towards sustainable, regenerative, plant-based food and demand for foods and beverages with immunity-boosting ingredients is driving the demand for these products and their constituents. Do It Yourself (DIY) trend has seen huge momentum during Corona times and is expected to continue in 2021.
Industry leaders are prepared to make adjustments toward improving labor management systems and adding benefits such as paid sick leave. Beverage brands have taken a significant hit during the COVID-19 crisis because they rely largely on restaurants and bars to make their sales.
Restaurant Industry Status
According to restaurant.org, the Restaurant Industry has lost more than 3 MILLION JOBS and $25 BILLION IN SALES since March 1 2020. And as of today, it is still reeling back from the effects of the pandemic. NEARLY 2/3 of operators reduced their hours of operation and according to FORTUNE more than 110,000 eating and drinking establishments closed in 2020 in the US alone.
Of restaurants that closed permanently in 2020, the majority were established businesses and fixtures in their communities; these eateries had been in business, on average, for 16 years, and 16% had been open for at least 30 years. Within this subgroup, these restaurants employed an average of 32 people; and 17% employed at least 50 people before they closed.
COVID-19 and supply chains
Currently, suppliers of raw materials and ingredients have reported little effect on their ability to supply ingredients to food and beverage companies. However, it’s expected that COVID-19 could potentially disrupt supply chains and impact raw material supplies. Because of this, it’s recommended that food companies line up alternate suppliers to meet their needs now rather than later when limited supplies become a problem. Unexpected inventory shrink costs retailers 1.33% of their total sales on average.
It’s also recommended that food companies take a moment to go over their emergency response plans. Reviewing your crisis management plan ensures that you’re prepared to handle disruptions and other potential problems caused by the COVID-19 crisis.
A supply chain management software can help to improve business operations in your company’s time of need. Supply chain management software vendors like Royal 4 Systems are dedicated to boosting cooperation, raising your business’s profit level, lowering delays in processes, increasing efficiency, reducing cost effects, raising output, and enhancing your supply chain network.
For more information on what a supply chain management software can do for your business during the COVID-19 crisis, contact Royal 4 Systems today.
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