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Foodservice Recovery Part 1: The Near Term

For the last year, the Produce Marketing Association BB #:153708 has met with a group of members weekly to discuss the state of produce in foodservice. As PMA predicts that the business will start to come back by summer, the group projects where the industry will go next.

This is part 1 of a 3-part series compiled by Lauren M. Scott, Chief Strategy & Membership Officer of PMA.

What Will Return Instantly?

Optimism

It will start to shift faster forward when the lights go green. It’s not a question of if, it’s when … and looking at where. It also depends on what food looks like. For instance, meal kits in more channels can have a huge boom. We are looking at catering, conventions and how food is served. -Grower

I see paths opening up. We struggle with limited access to buyers and creative people because they are working from home or they are not seeing people. Missed opportunities to discuss how our products can fit the trends. -Grower

I think things will be way more like normal than they won’t be. For instance, sustainability was put on hold, but generations deeply care so those initiatives so those conversations will be back. -Distributor

“Extreme” demand
Not in absolute amount but the immediacy of the need to fill the pipeline. Extreme not what we knew was the business but from where it is now over the weekly volume run rate. Restauranteurs (not convention, event and T&E) and schools that have been closed for long periods of time will overreact with demand to fill pipeline to get back in business. It will often come without warnings. -Grower

I don’t know how you organize for it because it happens from a light switch, but it will be sporadic. Hard to organize when you don’t have time to prepare. ~Distributor

People need time to open up and can be caught off guard when the government makes the announcements to open up very quickly. -Distributor

As markets open, we have to get product and the staff back up and running which take time. Some markets open very quickly, and others are very slow. It could be areas open, but customers won’t have the level of comfort universally. -Distributor

Even if doubling your order goes from 5 to 10, there is no guarantee we won’t cut the order without warning. We lost a ton of money last year and we are trying to be careful. -Distributor

Tension with The Ramp Up

Purchasing, saying we don’t have the guarantee and sales are so eager to get the wins. Ramping up but different season, we can’t use historical usages as a gauge of what to buy right now and 6 months ago was a different sense. The pandemic caused operators to change menus and how they operator. Our data is not as helpful as it usually is. -Distributor

5 to 10 “huge orders” are not enough to make a big difference but enough of a change to create huge problems without advance notice. We really need the communication from the customers and understanding of what we have gone through know what is going on that it takes time to recover so the more communication you can give us the better. -Distributor

Customers don’t understand we are still dumping product because we can’t get the usages right and yet we have shorts. This will take time. -Distributor

Even if the volume is not extreme the intensity of the business feels extreme. -Operator

Lauren M. Scott is Chief Strategy & Membership Officer of the Produce Marketing Association, Newark, DE.