Restaurant Industry Rebound Requires Rapid Response from FoodService Industry

Dave Foreman

The restaurant industry, and by extension all of food service, took a massive hit during the global health pandemic. While the pandemic has not ceased entirely, advances have been made to the point that the restaurant industry has not only begun to rebound, but in some areas have even approached reaching pre-pandemic levels.

According to market-researcher organization, The NPD Group, the number of restaurants in the U.S. is still down from what it was pre-pandemic, but grew by 18,000 locations over the last two years. Total foodservice traffic (including restaurants and retail foodservice), has increased by 2%, and restaurant visits were up 3% in January over visit losses due to the omicron variant last year. Foodservice consumer spending rose 7% in the month of January compared to a year ago.

Many sectors are reporting year-over-year growth, with many approaching pre-COVID numbers.

In January 2023, dine-in restaurant visits increased by 24% over a gain of 41% in January 2022. Even with these gains, dine-in traffic is still recovering from the steep pandemic-related declines of 2020. Drive-thru and delivery restaurants were the default beneficiary of pandemic restrictions, and visits for both remain elevated, 9% and 88%, respectively, versus three years ago.

Traffic at breakfast and morning snack periods has fully recovered from pandemic declines, increasing in January by 13% compared to a year ago and are up 3% versus three years ago.

Likewise, gains have been seen across broadline foodservice distribution as well. Case shipments from foodservice distributors to restaurants and retail foodservice outlets were up 7% in January compared to January 2021 and increased by 4% from three years ago.

Foodservice distributors increased their case shipment orders to quick service restaurant operators by 6% in January 2023 compared to the same month in 2022, which is 9% greater than the pre-pandemic orders in January 2020.

Broadline foodservice case shipments to full service restaurants, which took the brunt of pandemic dine-in restrictions, increased by 10% in January 2023 versus a year ago and are within 1% of recovering from pandemic losses.

Foodservice distributors need to be ready for this ongoing rebound by having modern systems in place to handle an influx in demand for products and customers looking for new and efficient means of ordering. 

An agile ERP platform like Prime allows distributors to respond to the increased demand with ease – streamlining and at times automating processes that would cause potential delays or scaling issues.

See a Prime FoodService Demo On-Demand

An intuitive ordering system, allows users on the distribution side to set up Order Guides for individual customers, including items that they usually order, as well as potential cross-sale and upsell opportunities, making order entry a far less complicated and time-consuming endeavor. 

Prime FoodService also offers users the ability to automate alerts to be received when products are unavailable, a vital tool when dealing with the ever-increasing threat of supply chain disruptions. As demand for specific foods and items continues to increase, the ability to quickly pivot to an alternative in the event an item is unavailable invaluable in ensuring there are no disruptions for customers, which is vital for keeping them happy.

Another oft-overlooked consideration is the ability of an ERP platform to scale easily and effectively to the shifting needs of a distributor. An agile platform, Prime can be accessed by any user on any internet connected device- it is not limited in number of users by contract, and is not tethered to specific computers or departments. This ensures that the people who need to be able to access the system are always able to- there will be no delays waiting for user access rights to be assigned, or a particular computer to be free.

By adopting an agile, modern ERP platform such as Prime FoodService, food distribution companies can take advantage of the recovery of the restaurant industry and push your businesses into the future.

See a Prime FoodService Demo On-Demand