Restaurant and food service experts' predictions regarding industry trends for the year had one in common: the need for wholesalers and distributors to be able to adapt to the quickly changing landscape.
The US food service industry has recently undergone significant changes, and many more can be expected as we move further into 2018. Many restaurant and food service experts have made predictions regarding industry trends for the year, and they all had one in common: the need for wholesalers and distributors to be able to adapt to the quickly changing landscape.
“Change is here to stay, and this year’s top trends reflect the industry’s acceptance of this state,” Andrew Freeman and Company explained in its 2018 annual trend report. “Successful hotels and restaurants are turning creativity into innovation and adapting faster than ever. And there’s a lot of change to deal with – economic, political, and social factors, as well as significant cultural shifts in how people use restaurants and hotels.”
These changes are necessary and exciting, but they are also costly and time-consuming. In their recent Food Industry Forecast, foodservice refrigeration company Emerson Climate Technologies estimated that labor costs in the US will increase by between 50 and 100% within the next five years due to rising minimum wages, increased healthcare benefits, and worker shortages. During that same period, costs associated with regulatory compliance, transportation and logistics, and food, in general, are all expected to increase by a minimum of 50%.
As these costs continue to rise, one tool has been singled out by the food service industry as proven to improve cost efficiency: big data.
Big data – the enormous data sets collected through everyday processes that are analyzed to reveal patterns and trends – has already begun to have a dramatic impact on pricing and cost transparency within the foodservice industry. Purchasers and distributors alike are making decisions based on data patterns, allowing them to cater to consumer interests more efficiently and effectively.
Nishat Mehta, EVP of global partnerships at Dunnhumby, the marketing firm for US grocery chain Kroger, explained that by looking at buying patterns over long periods of time, grocery stores are able to make better proactive decisions, instead of acting reactively to seasonal or cultural trends.
“We make decisions not based on what you bought today but what you bought over the last two years. You don’t have to know, but we know,” Mehta said.
Not only is big data helping companies improve their purchasing, but it is driving decision-making when it comes to choosing food vendors. After Levy Restaurants lost a concession contract to Aramark due to a lack of data analysis, EVP of new business development Jeff Wineman said that choices are being based on more than just the quality of the product.
“Food quality is still important, but it’s not number one anymore,” Wineman said. “Now it’s data; it’s analytics.”
Combining Tech and Sales
Finding a solution that utilizes big data while also increasing sales can seem like a daunting task, but foodservice companies need look no further than business intelligence software. BI tools utilize big data created through a company’s back-end system and analyze it to find cross-selling opportunities and areas where margins can be improved on. In an industry with rapidly increasing operating costs, the only option is also to increase revenue. Implementing a BI tool is the easiest and most efficient way to do that.
Find out how your company can implement a business intelligence solution by scheduling a free demonstration of sales-i software today!