Restaurants are one of the countless businesses that have felt the impacts of supply chain disruptions in recent years. With new challenges from long delivery times and increases in freight costs to logistics disruptions at ports around the globe, the supply chain has not been able to fully recover from the impacts of the COVID-19 pandemic.
As the holiday season quickly approaches, the strain is only expected to tighten. Ongoing global events including the Ukraine-Russia conflict and strict pandemic measures reintroduced in China and other Asian countries have augmented manufacturing backlogs. Labor shortages spurred by the “Great Resignation”continue to have a tremendous impact on manufacturing and shipping. Additionally, restaurants continue to feel the effects of rising food prices while demand shows no signs of slowing down.
It’s not too late for restaurants to get ahead of supply chain issues this holiday season. To do so, food providers must understand how these issues will impact their operations and take steps today to address any potential issues in the future.
Holiday food demand drives packaging needs
In a yearly pattern, food consumption among Americans rises between Thanksgiving to the New Year. Like Santa packing away cookies, Americans tend to order about 440 extra calories per serving during the holidays, according to a study from Cornell’s Dyson School of Applied Economics and Management. On top of that, more Americans take advantage of restaurant takeout and delivery services during the holiday season. Christmas Day was DoorDash’s top holiday for food delivery in 2021, according to the company, followed by New Year’s Day.
These anticipated spikes in consumption and ordering mean more packaging needs for restaurants. This time last year, restaurants across the country were struggling to find plastic straws, cups and takeout containers to meet swelling demand for to-go orders. With ongoing supply chain disruptions, supply shortages of packaging materials are expected to resurface this holiday season.
What it means for restaurants
The continued rise in food costs has already led many restaurants to increase prices earlier this fall. With no end in sight for supply chain constraints, these higher prices along with substitutions for restaurant necessities have become customary to keep up with food sales and appease customers.
As the holiday season begins, the pressure will be on for restaurants to keep up with rising takeout and delivery orders amid packaging shortages. When unaccounted for, supply shortages of these materials can lead to missed orders, deteriorated customer relationships, damaged brands, and loss of revenue. These negative effects are heightened during the holiday season when emotions are high and consumers are looking to feed their family and friends their favorite foods.
While many food packaging manufacturers prioritize supply ahead of the busy season, the supply chain challenges being faced today are largely caused by factors out of their control. As these shortages persist, restaurants might find themselves in need of food packaging necessities without a fast and easy way to acquire them.
It's not too late to prepare
The holidays might be right around the corner, but restaurants still have time to take steps to ensure they have enough food packaging and supplies to get them through the busy season.
To get started on a supply disruption mitigation plan, restaurants should first conduct a thorough evaluation of their needs and risks. With that background, you can work closely with suppliers to forecast supply needs for the holiday season and evaluate their mitigation plans and ability to meet your needs. For restaurants relying on imported supplies, it’s also a good idea to consider shortening the supply chain and finding a domestic supplier or manufacturer. This would likely reduce delays and allow for packaging products to be restocked quickly for more orders.
As the world of food delivery and takeout continues to change, it’s increasingly valuable to partner with trusted leaders in the food packaging space.
Stephny Halstead is Sabert’s Vice President of Marketing & New Product Development. In this role, she leverages the innovation capabilities within the organization to drive strategic growth initiatives and marketing communications activities.