Raj Tugnait, chief executive, Sysco Speciality Group, considers how suppliers can adapt for the post-pandemic world.
Like everybody else in the sector we were thrilled to see hospitality reopen and delighted that media predictions about pent-up consumer demand appeared to be spot-on as operators began to stock up again.
But reopening has also presented a raft of new challenges, such as trying to predict what volumes to purchase in the face of irregular booking patterns, no-shows, limited covers and the weather. To complicate things further, it is becoming apparent that the closure of hospitality shortly after Brexit meant that the effects of the UK's departure from the EU never really played out in full for some operators.
All these factors place further onus on the supply chain, because what operators need now are suppliers who can flex with them. So, against this volatile and ever-changing backdrop, what can suppliers do to add value to their proposition, elevate themselves to the status of business partner and establish working relationships that will endure post-Covid?
The first thing we need to accept is that there have been some fundamental changes in operators' needs. Where they were once focused on variety, what's important now is whether a supplier can guarantee availability, day in, day out, on core products. Especially if those core products, driven by emerging trends such as menu simplification, safety and the explosion in home delivery and takeaway, are not only radically different from those that they purchased pre-lockdown, but are also required in significantly higher volumes.
One thing that has become abundantly clear to us over the past 18 months is how much our customers have come to rely on us to just be there for them, whether that's putting in place practices that ensure touch-free, Covid-safe deliveries, creating purpose-built apps that allow them to order directly from us, extending credit terms or arranging payment plans. It is this type of value-add that will set you apart as a supplier. As, indeed, will providing customers with insight into what lies ahead.
Innovation will be a key driver, especially towards the end of the year, because although many operators will initially look to deliver a tried-and-trusted core menu post-lockdown, we expect consumers to demand innovation to overcome the fatigue of 18 months spent cooking at home.
We expect consumers to demand innovation to overcome the fatigue of 18 months spent cooking at home
Well-established trends around healthier eating, such as vegan, flexitarian and vegetarian diets, will continue to gain traction, while breakfast will see a resurgence as consumers return to the workplace.
Dark or ghost kitchens will continue to grow, helping to extend the reach of well-established names and spawn completely new virtual brands.
In the short term we expect the shift towards de-skilling to continue due to the acknowledged industry-wide skills shortage, so demand for pre-prepared fruit and vegetables is likely to grow.
Delivery aggregators, such as Deliveroo and Just Eat, will continue to thrive, although we expect to see some consolidation.
Consolidation is also likely to feature in the supply chain as operators continue to demand value without compromising on quality. We are already seeing this within our own business, where customers can buy from our specialists, such as M&J Seafood, Wild Harvest and Fresh Direct, and have their products supplied as part of one delivery, with a single invoice. This is already playing out well for our larger customers, and we increasingly feel that it's something independent customers will benefit from too, allowing them to harness the financial benefits without compromising on range, quality or specialism.