Supply chain problems could have positive impact on F&B industry

The chickens appear to be coming home to roost. Sadly, they don’t seem to have been roosting at Nando’s, McDonald’s and other foodservice companies, where shortages of the birds have at times prompted the temporary closure of certain units and resulted in menu changes.

No chicken to be had…

It’s not only the chickens that have been problematic though, because the pandemic and post-Brexit disruption that has caused lorry driver shortages has led to shortages of foods right across the board. Such is the parlous situation, with global supply chains in disarray, that the head of the Food and Drink Federation reckons this scenario could be long-lasting. So bad are things that he is calling time on the days when we’ve always had every food imaginable available in our supermarkets and on the menus of our restaurants.

The “just-in time” supply chain systems involving frequent deliveries had effectively done away with the need for stock rooms holding goods ahead of the next delivery, but Brexit and covid-19 have rendered this fragile infrastructure unfit for purpose. No longer can we be reliant on the constant replenishment cycle whereby goods go straight from the lorry onto the shelves of supermarkets, and into the hands of wholesalers for supply into restaurants.

The ramifications for restaurants are clearly enormous, and running out of chicken is clearly not great if you are Nando’s. But I’m predicting the present situation might just have some positive broader impacts on the food service industry. It will absolutely prompt a closer look at supply chains, and from this it could hopefully lead to a reduction in the levels of waste that blight the industry. As much as 30-60kg of food per day is thought to be wasted in the average restaurant, according to Dutch-based firm Orbisk, which has developed a food waste monitor for kitchens.

The Orbisk food waste bin in action

The ludicrously broad-sweeping menus available in some establishments might have their wings clipped because they simply become unmanageable in their complexity, as shortages of ingredients become part of the food landscape in the future. Since such establishments must be more susceptible to waste then this can’t be a bad thing, even if it comes with some short-term pain. The incredible array of options that have typically been available on the global buffets must also be an area of great focus for their operators, who must look to minimise food waste from the supplies they are successfully able to source.

We are already seeing evidence of changes with menu construction, according to Lumina, which found dish counts across both chain and fast-food restaurants, as well as managed pubs and bars, are currently, on average, 20% smaller than pre-pandemic.

As well as cutting menu options there are also, thankfully, a variety of solutions out there to help businesses cut the level of food destined for the bin. A growing number of retailers and food service operators are working with the likes of Olio, which has just raised $43 million to fund its global expansion. More than 30,000 “food waste heroes”, who are trained members of the community, collect and redistribute unsold or unserved food from the likes of Pret A Manger, Compass, Costa and Elio. They have been joined by Tesco, whose 2,700 UK stores now redistribute surplus food nearing its sell-by date via the Olio network.

Another expanding player in this app-based space is Too Good To Go, which connects restaurants and stores that have unsold food with customers, who can then buy the surplus, without being able to choose, at a much lower price than normal. I’ve enjoyed some incredible deals with Too Good To Go “magic bags” that have contained a great mix of products at around a 40% discount, which would otherwise have been heading for the bin.

The adoption of such solutions has absolutely been both financially and ethically advantageous to those foodservice companies who have already chosen to get onboard. I’d suggest the ongoing issue with supply and availability of food stuffs into the UK should foster an environment for many more businesses to join them, as they really must get a better handle on the overall management of their supply chains.

Glynn Davis, Editor, Retail Insider

This piece was originally published on Propel Info where Glynn Davis writes a regular Friday opinion piece. Retail Insider would like to thank Propel for allowing the reproduction of this column.