leave clues and losing customer counts year after year simply has to stop if
the restaurant sector wants a return to a new normal. If not the seven, year trend of raising
prices, and year over year same store customer count declines will continue
according to Steven Johnson,
Grocerant Guru® at Tacoma, WA based Foodservice Solutions®.
The fast of the matter is restaurant traffic has yet to recover.
Year over year, same-store traffic was down -5.1% compared with May of 2019.
Not only are guest counts declining in restaurants, but traffic performance
worsened during the most recent month. April’s two-year same-store traffic
growth was relatively stronger but still down 4.0%. This can’t continue forever.
This year the PLMA
annual trade show will be putting a spotlight on foodservice for the grocery
sector as demand for affordable, restaurant-style
meals continues to drive customer adoption. The Private Label Manufacturers
plans to highlight foodservice at its annual Private Label Trade Show.
When PLMA announced this week that the 2021 Private Label Trade Show, to be held in-person on Nov.
14 to 16 in Chicago, will feature expanded participation by foodservice
suppliers across food, nonfood and beverage categories. Overall, the event is
expected to draw more than 2,000 exhibitors and over 5,000 visitors. It was
clear that the outside eye’s that need to be there are those from the
restaurant sector according to Johnson.
Today, grocery stores are more
competitive with restaurant takeout than ever before, PLMA said, citing a spike
in demand for prepackaged, ready-to-eat prepared foods, more convenient snacks
and meals to go as many consumers tire of the months of cooking at home during
At the same time, the New York-based
association noted, a surge of in-app and online ordering for home delivery and
curbside pickup have blurred the lines between retail grocery, convenience
and restaurant channels. Yes, just like restaurant online ordering but
consumers are learning that they can get a restaurant quality meal for less at
a grocery deli then from a restaurant.
According to PLMA Vice President Anthony
Aloia, stated, “Consumers have become more accustomed to finding freshly made,
restaurant-style meals in supermarkets — whether prepared by in-store bakery,
deli and meat departments, or brought in from a ghost kitchen or commissary —
which are sold at extremely reasonable prices under the retailer’s own brands.”
Chain restaurants suppliers will be there,
including some the nation’s largest foodservice, such as Sysco, US Foods,
Aramark and McLane, among other — will on the show floor at this year’s event
along with buyers from major grocery retail chains, PLMA said.
These foodservice distributors and
wholesalers offer highly developed brand programs, ranging from value labels in
food, nonfood and takeout packaging to proprietary labels in such categories as
coffee blends, farm-raised meat and produce, craft cheese, artisan bakery,
sustainably sourced seafood and ethnic fare, including Italian, Latin and Asian
specialty foods, the association said.
Get this, last year, the top 20
private-brand categories by dollar volume included frozen prepared foods at
$2.3 billion (with an 11.1% market share), deli prepared foods at $2.2 billion
(with a 38.7% share) and grocery prepared foods at $2 billion (with a 12%
share), according to the 2021 PLMA Yearbook. By unit volume, grocery prepared
foods (1.3 billion, with a 13.1% share) and frozen prepared foods (763.7
million, with a 12.9% share) were among the top 20 private-label categories.
Many “best in class” retail chains
already have expanded their convenience-focused food offerings for prepared,
kitchen and table-ready meals, either packaged for online pickup or delivery or
for grab-and-go from stores, according to PLMA.
Retailers simultaneously have rolled out
new mobile purchasing, shop-from-home and last-mile delivery options to make it
easier for customers to get prepared foods. In addition, grocery retailers have
latched onto restaurant food trends, including farm-fresh and locally sourced
ingredients, better-for-you fare (natural, organic and minimally processed
foods), more options for special diets (plant-based, vegetarian and vegan) and
PLMA press release stated, “As the
pendulum swings back towards normalcy in months ahead, restaurants whether fast food, takeout fast-casual or fine
dining — are sure to feel pressured to engage the challenge posed by all this
expansion of foodservice at retail. Expect them to fight to woo their customers
Regular readers of this blog know that, ordering
convenience, delivery, and full flavored food, will be among the battle lines
for fast food and takeout. Less crowding, touchless payments and visible
sanitation will no doubt continue to matter for in-dining experiences.”
Why worry? Restaurants will be facing additional
expense for such improvements and a possible rise in labor costs, we can also
expect to see more aggressive promotions and lower prices. Taken together,
these likelihoods are sure to make all manner of private-label products from
foodservice suppliers increasingly attractive to restauranteurs from a margin
Solutions® to complete a Grocerant ScoreCard, or for product positioning or placement
assistance, or call our Grocerant Guru®.
1991 Foodservice Solutions®
of Tacoma, WA has been the global leader in the Grocerant niche. Contact: Steve@FoodserviceSolutions.us or 253-759-7869