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Foodservice inflation may be worse than it looks

As the foodservice industry tries to recover from lockdowns, restrictions, and consumer hesitancy, it’s plowing into inflation headwinds that may get worse before they get better.

“I expect inflation to last past 2023,” said Mathew Tate, director of strategic sourcing-produce for Aramark and Avendra Group, during a May 4 International Fresh Produce Association BB #:378962 town hall webinar.

He said there are suppliers and operators who have held off from passing on higher costs, but they will start passing them on soon, which will further increase inflation in foodservice.

Joe Watson, IFPA’s vice president of retail, foodservice and wholesale agreed.

“Consumers aren’t seeing full food inflation because it hasn’t been all passed on yet,” he said.

But it’s not all doom and gloom in foodservice.

Evan Nash, director of purchasing for Johnson & Wales University said on the webinar that consumers are tired of cooking and eating at home and are eager to return to restaurants.

“Usually, people eat out less with high inflation, but we’re seeing more demand for dining out,” he said.

Mike Kostyo, trendologist and associate director at Datassential, said there are several trends that favor foodservice growth.

“There’s pent-up demand to go to more restaurants that will conflict with inflation,” he said.

Kostyo said consumer indicate strong motivation for supporting locally grown and seasonal foods. Vegetables, in particular, have strong associations with season.

“Seventy-five percent of consumers say they look forward to new food and bar trends in 2022,” he said.

Tate said he’s starting to see some reduction in portion sizes at restaurants to help keep costs down, and that can be a good thing both for getting more lower cost produce items onto plates but also for overall health for Americans.

Nash added that appetizers and side dishes rising popularity could counteract inflation and be a place for increasing fruit and vegetable usage.

“Consumers may not ask for more produce, but it’s our job to serve it and have it more available,” he said.

Greg Johnson is Director of Media Development for Blue Book Services