Shortages Delay Economic Recovery of Bars and Restaurants

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The hospitality industry suffered during the pandemic. Because of the restrictions placed to control the spread of COVID-19, bars and restaurants had to restrict operations. This led to a loss of income.

In the past year, more than 110,000 establishments that serve food and beverages temporarily or permanently closed. Sales declined by $240 billion.

However, even now that some restrictions have been lifted, the nightmare is not over.

Pandemic Leads to Shortages

The pandemic also caused disruptions in the global supply chains. The closure of international borders has led to long delays in deliveries.

Moreover, COVID-19 reduced the capacity of manufacturers to operate. When a worker tests positive, which happened in many places, work has to stop for sanitation and allow those exposed to self-quarantine. Others had to operate with a reduced capacity to allow physical distancing in the factory or warehouse.

Many countries all over the world also went into lockdown. Non-essential work had to stop, and that includes manufacturing.

All over the country in the past year, store shelves sat empty. Nearly 90 percent of homeowners reported that they had difficulty acquiring various appliances. For months, people could not buy refrigerators, washing machines, air-conditioners, and smart home devices.

The shortage extends to bars and restaurants across the whole nation. The industry is currently facing an outage of basic supplies, including silverware and containers.

Owners should look into buying kitchen equipment from local manufacturers. There are kitchen tools, and devices such as stainless steel carts for restaurants and bars that are made in the U.S.  Buying locally guarantees that there would be minimal or no shipping delays. Moreover, it supports the local economy.

Ingredients Sold Out

Food items are also in limited supply. Reuters conducted a survey earlier this year and found that at least nine fast-food chains have experienced supply bottlenecks for certain ingredients, forcing them to change their menu temporarily. Some hard-to-find items include chicken wings, wieners, lettuce, and french fries.

Non-food necessities such as paper bags and plastic packaging materials are also having outages.

The product itself is not scarce. The problem stems from ongoing challenges in logistics. COVID-19 led to closures and reduced labor in factories and warehouses as well as farms. In fact, since last year, meat and poultry products have been hard to find because production plants have been hotspots for infections. Multiple facilities have had to shut down because of the rising number of laborers who tested positive for COVID-19.

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The pandemic is also restricting the movement of cargo ships, trains, and trucks, further causing delays.

The shortage of food items differs from place to place. For example, the U.S. is having an outage of green tea. In South Korea, on the other hand, there are not enough french fries for everyone.

Starbucks is among the major chains that have been struggling with the supply of certain ingredients for months. Aside from green tea, some of its locations have run out of cinnamon dolce syrup, spinach, feta cheese, and egg white wraps.

Taco Bell has received complaints about the lack of hot sauce. It also warned customers earlier this year that some menu offerings may not be available in some restaurants.

Impact on Recovery

The shortages create more hardships for businesses that have already experienced losses in the past year. This year continues to present challenges to bars and restaurants.

If the shortages continue, food and beverage establishments will have very disappointed customers. The establishment will miss out on profit because they would not serve what the customer has ordered.

Moreover, the shortage is causing the cost of food products to skyrocket. Many items have become more expensive this year. The cost of meat, for example, has increased by up to 75 percent this year. Chicken is up by 100 percent.

Businesses will have to adjust the pricing for their menu offerings or substitute some more affordable ingredients to maintain the original cost of dishes they serve.

According to experts, bars and restaurants may have to hold out for a little more while. While vaccination of populations worldwide has started, bottlenecks in the global supply chain might persist until 2022.

The food and beverage industry has had a tough year, but the crisis is far from over. Many bars and restaurants are currently experiencing a shortage of basic ingredients, including potatoes and lettuce. Certain non-food items are also running out. This means that the industry that has already suffered in the past year due to lockdowns is unlikely to see businesses go back to normal soon.

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