The current state of the foodservice industry can best be defined as promising. While event venues, universities, cafeterias and vacation services are still struggling to fully recover, services such as drive-thrus and takeout are flourishing as much as ever. In-house dining is also experiencing a comeback.
“Considering the number of population dense areas of the country still under some form of restriction, we believe the storm of demand is just beginning to brew,” said Mark Marcucci Jr., national director frozen, Alpha Baking Co., Chicago. “Even in markets already considered open, there are still significant segments that haven’t returned to their normal operations, providing additional cause for further increased demand as markets fully open up.”
The United States Census Bureau Advance Monthly Retail Trade & Food Services reported April 2021 sales were up $16.9 billion from the drop in 2020 and up $1.1 billion from 2019, before coronavirus (COVID-19).
Cordia Harrington, chief executive officer, Crown Bakeries, Nashville, Tenn., said she has seen its quick service restaurant (QSR) and other restaurant customers experiencing the greatest rebound in foodservice so far.
“Anything tied to events, catering, hospitality and attendance has continued to be soft,” she said. “With the return of fans and full attendance to stadiums, students returning to campuses, and the stabilization of the labor market, we are optimistic these segments will also return to pre-pandemic levels.”
That being said, casual dine-in restaurants were not entirely spared from the impacts, even in the first quarter of 2021. Applebee’s sales were down 6.2% versus 2019, and IHOP sales were down 21.2%, according to company statements. Still, according to the US Census Bureau’s Advance Monthly Sales for Retail & Food Services, there was a surge in year-to-date sales through April of 2021, with dollar sales being up 17% from 2020 and 15% from 2019, as reported in an American Bakers Association (ABA) member webinar with Todd Hale, retail insights thought leader and principal at Todd Hale LLC.
“From a baker’s perspective, the industry seems to have rebounded and then some — especially in the last few months since vaccines have become more widely available,” said Tim Gill, vice president national sales director frozen, Alpha Baking. “In the midst of Q4 2020, we began to see demand resuscitate and the production engine spit and sputter back to life. Q1 2021 demand started to increase week over week, rising to pre-pandemic levels, and has since grown even more robust through Q2. In fact, we have seen demand over the last couple of months surpass 2019 by 6% to 8% in the markets that are mostly open.”
Mr. Gill reported that from its local fresh markets and national frozen distribution, full service, fast casual, limited service, and bar and grill have been the segments leading the recovery charge. The segments recovering the slowest, he said, are B&I and concessions and convention centers, though he said he believes these will soon return as well with normal business operations.
“We’re very confident,” said Luc Mongeau, president, Weston Foods, Toronto. “Throughout the pandemic, consumers have maintained they missed the experience, the hospitality and feeling of connection they get when dining out. Now, as pandemic-related restrictions ease, they’re eagerly returning to restaurants to enjoy those experiences again.”
This article is an excerpt from the August 2021 issue of Baking & Snack. To read the entire feature on Food Service, click here.