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Where are all the Pickles? Restaurant Supply Chains Face Shortages

Where are all the Pickles? Restaurant Supply Chains Face Shortages

Toilet paper shortages are old news. Now, it’s ketchup, pickles and oat milk.

Restaurants were ready for business to pick up after stimulus checks arrived and vaccinations became more available, but it turns out that restoring an entire supply chain takes some time. 

With the restaurant supply chain out of whack, what advertising numbers are we seeing from the restaurant category in the B2B space?

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Why there’s no oat milk for your iced shaken espresso

Between stimulus checks and an increased feeling of safety, people are ready to eat out again. 

In March, restaurant food sales increased 13%— the largest jump in a year. Forecasters predict this trend will continue throughout the summer, especially considering how restaurants can now take advantage of the federal Restaurant Revitalization Fund.

The surge didn’t come as a surprise, but putting together a disheveled supply chain didn’t prove simple—leaving some products hard to find. 

During the pandemic, many restaurant supplies were shifted to retail and drivers were let go. Those drivers found work at shipping companies like Amazon. Now, as traditional suppliers return to their original business model, they’re struggling to find new drivers. 

“The driver shortage is definitely real,” said Debra Bachar, president with Blueberry Business Group to Restaurant Business. And it’s just one of many challenges facing the supply chain. “The impacts are massive.It’s going to take some time to sort out.”

The experience of what’s missing varies from chain to chain. Starbucks goes through spot shortages of its Oat Milk. Takeout restaurants are lacking ketchup 

“We’ve been hunting high and low,” said Chris Fuselier to Wall Street Journal. Fuselier owns Denver-based Blake Street Tavern and is working hard to keep ketchup packets in the kitchen. Packet prices are up 13% since January 2020.

These shortages pale in comparison to the challenges the restaurant industry faced last year, but are still a Covid-issue that will take time to work out. 

MediaRadar Insights

In April 2021, spend in the Restaurant Supply and Food Service industries in the B2B space is down 31% YoY compared to April 2020. Currently, the depressed spend is impacted both by fewer advertisers in this space (126 in 2020 vs 91 in 2021).

Like other B2B industries, digital ad spend is starting to command a larger presence. Digital ad spend in the Restaurant Supply and Food Service Industries is up 622% YoY (April 2021 vs April 2020). 

This month, we saw $133k in digital ad spend, where last year digital advertisers only spent $18k. In April of 2020, just 3% of the total ad spend in this industry was digital.

Even though overall spend is still down, the good news is that this industry saw a 20% improvement in ad spend month-over-month from March to April in 2021. 

As indoor eating restrictions lift and restaurants receive additional support from the Restaurant Revitalization Fund, we’ll likely see spending pick up. And it’s likely the shift to digital is a trend that’s here to stay.

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