The impact of the COVID-19 pandemic on the foodservice and packing industries will be felt far beyond 2020.
In the weeks that followed, most nations asked citizens to stay at home to avoid possible spread of the virus. As consumers rushed to stock their pantries and refrigerators, items such as ground beef became nearly impossible to find. Restaurants were closed, or limited to take-out or curbside pickup.
At the same time, large processing plants began to temporarily shut down due to employee illness, slowing down the production chain and causing a backlog of market-ready animals.
“Our production was geared more toward the foodservice industry,” says Sarah Little, vice president of communications for the North American Meat Institute.
“Suddenly, that market was nearly gone. We had to switch gears, but it’s not just a matter of different meat cuts. It’s packaging, labeling, etc. Now that we are close to 100% (packing) capacity, we are learning how to switch back.”
Other foodservice elements, such as school lunch and hospital cafeterias, were also impacted by the virus and how it affected the packing industry, says Erin Murray, business development director with Datassential, a consulting group that works with the foodservice industry,
“With travel closed, lodging took a hit,” she says. “Schools, large cafeterias – overall we saw a big decline in sales.”
Murray says many restaurants adapted, offering curbside pickup or take-out. Restaurants with a drive-thru option did very well in many cases, she says.
It’s quite likely this has changed the template for many foodservice-related businesses.
“Consumers feel safe in their vehicles, so we will likely see even more of this,” Murray says.
“They like the option of being able to just pick something up, especially with the current situation.”
She says 63% of foodservice operations have had to lay-off employees. Of that, 30% let go at least 75% of total staff.
“As of June 12, 28% of those operations remain closed,” Murray says.
One change could be how foodservice companies manage inventory. She says in some cases, there was either too much or too little on hand for immediate needs.
“It’s so difficult to make a prediction on traffic, because as we have seen, it can change dramatically and rapidly,” Murray says, adding she believes there could be more orders for frozen meat, rather than fresh, in the future.
Convenience products will likely continue to increase in popularity, she says.
Little says packing companies will likely look at changes that increase worker safety. Those could include increased distance between employees in addition to more personal protection equipment.
More automation is also a possibility, but Little says that is likely years away.
“It may push companies to look more into it,” she says.
Because of the pandemic, Little says packing companies have made some changes already, and likely will make more.
“For example, we didn’t have the capacity to make bacon with the pork bellies we had. A lot of that goes to the foodservice industry,” she says. “Chicken wings were another item we had difficulty producing.
“There were so many things you never thought about. We just have to take what we learned and make some changes where necessary.”