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Get Ahead of Inventory Issues for Your Restaurant

Get Ahead of Inventory Issues for Your Restaurant

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Because of the pandemic, 15% of all foodservice industry establishments had to permanently close their doors. Now, the industry is finally looking up with governments slowly opening back up with adaptations for the COVID-19 crisis occurring. With local governments lifting restrictions on indoor service, many operators are gearing up to expand operations. For restaurants and other foodservice industry businesses, moving from the phase of pandemic living into post-pandemic life can be seen as moving from a desert to an ocean with the flood of customers. Surely, business owners are grateful to be busier than ever, but the supply-side of the economy is still struggling to catch up with the demand.

 

In addition to difficulties with staffing, food service businesses must juggle obstacles in their dependence on supply chains like delivery delays and supply shortages (with little patience or understanding from customers). Replacement equipment must be purchased to ramp up for an influx of customers and some units need replacing to adapt to a new food service environment. Either way, owners of foodservice establishments must prepare for what the post-COVID food industry world now looks like.

 

Expansion and an influx of customers would seem like a great problem to have right? Unfortunately, the global supply chain faces several significant difficulties which have and will continue to overflow into the foodservice industry. With the slowdown in the global supply chain, production of things from normal restaurant dining room items to commercial refrigeration units has slowed to an alarming rate. An expanding business isn’t the only one that would have to worry about new units. The slowdown could also negatively affect a business needing to replace a broken unit or stock up on other items. We’ll look at what’s being impacted and what delays you need to prepare for.

 

Current Supply Chain Problems:

There have been numerous economic setbacks seen due to the COVID19 pandemic, that much is obvious. Slightly unforeseen; however, are the residual repercussions that have hit a multitude of industries. The negative residuals can be pinpointed back to slowdowns and halts in the worldwide supply chain. Some supply chain problems include:

·       Slowed Production of Raw Materials

·       Factory Slowdowns

·       Increased Demand

There is a HUGE backorder on restaurant equipment with shipping delays and just complete unavailability. What used to take a few days now takes a few months. It is not dramatic to say that one cog in the supply chain not turning is completely detrimental. With its complexity stretching across the world, there have always been huge risks and room for disaster. This was all before the COVID pandemic and the problems that are being faced now will not be going away any time soon! Let’s break down what’s happening.

 

Slowed Production of Raw Materials

Raw materials are required to produce almost everything else. Unfortunately, mines across the world have not been able to produce the supply of raw materials that production companies require. Mines are an ideal place for the spread of a virus with their cramped spaces and lack of fresh air circulating. Therefore mines, globally, have been working at a reduced capacity to try to keep workers safe during the COVID pandemic. To try to reduce the spread of the virus, mineworkers have practiced social distancing, but this has directly impacted the extraction of raw materials. Now, those minimal extractions are going for higher prices because of the higher demand. The absolute only way that this can be resolved is to get back to normal operations after countries get the virus completely under control. Even then, a full recovery cannot be projected with the utmost confidence. Additionally, until operations can go back to “pre-pandemic” extraction rates, the detrimental repercussions will continue.

 

Factory Slowdowns

Like the situation with mines, factories have had a slowdown in production operations due to the implementation of social distancing and other protocols to protect their workers. This means, similarly, that factories are running extremely slow post-pandemic. This is in addition to not having the raw materials needed for production. Additionally, some factories are having difficulties staffing for important positions post-pandemic lockdown. There has been a noticeable lack of qualified candidates for machinists, welders, and important skilled worker positions required to keep a factory running efficiently. So, there is an even longer production time when the raw materials can make it to the factory line.

 

Increased Demands

During the pandemic lockdown and closure of public businesses, many people picked up indoor hobbies or interests. Because of this, there was an increase in purchasing of goods to try to make being in their homes more entertaining. A lot of money was also spent on items for purchase that would have otherwise been spent on outings like amusement parks or restaurants. Now, with restaurants, along with a lot of other public businesses, opening back up, that money can be circulated to the public economy. Thanks to this and in addition to stimulus checks or other financial aid programs, there is a direct increase in public spending. All of this (and other contributing factors) have instantly increased the demand for all kinds of goods, including various restaurant or foodservice industry equipment. Production, unfortunately, has not increased with the demand.

 

 

How does this affect you?

Even in our personal lives, you can see the increase in demand and cost of goods. Correlated with this is the delay in receiving these items as well. On a small scale, minor products at the grocery store that you could always count on being on the shelves are nowhere to be seen down the aisle. On a larger scale, cars values have gone up with demand due to the lack of production products.

 

The same struggles can be seen with nearly every type of equipment. Even items that were produced locally can be on backorder because of shipping slowdowns. Everything from restaurant furniture to commercial freezers and coolers is subject to backorders and shipping slowdowns due to the lack of raw materials and shortage of skilled workers. Items that were once readily available will take months to come in for your business with no real improvement in sight. Luckily there are ways to prepare for the new year and the continued influx of customers and demand that comes with it.

 

Your Solution

ORS is here to help. We have a wide variety of units available in our warehouse and we have experts that can guide you in the right direction to prepare for customer influx and business expansion. Ways that we can help:

·       We can hold your equipment at our warehouse and “ship when ready”

·       Our product specialists can provide updated stock list dates and back-ordering information

·       Our product specialists can find you an alternative piece of equipment if the exact model you want is unavailable

Call one of our specialists today and get ahead of the demand to come, we’re here to help. 

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