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From grocery stores, restaurants to suppliers: hurry up and make more

Meanwhile, many food manufacturers and distributors say labor shortages, supply constraints and high fares make it difficult to order complete and timely products from cake mixes to ramen. .. The coronavirus pandemic has created similar tensions across the US economy as the industry faces supply shortages and complex resumptions. As a result, the prices of many food, consumer goods and other commodities are rising.

“Supply chain challenges still remain,” says Hometown Food Co, a maker of Pillsbury cake mix and Buitoni pasta. Henk Hartong, CEO of Brynwood Partners, who owns the property, said. He said the cost of wheat was soaring and the shipment of ingredients containing Vitamin C from Sunny D was delayed. “It’s not just one thing, it’s all.”

Wal-Mart told its suppliers last fall that orders need to be 98% full and on time. According to a September letter from a major retailer read by The Wall Street Journal, suppliers who do not comply will be charged 3% of the cost of the shortage.

“We need to improve product availability,” says Wal-Mart’s letter. Wal-Mart wants to save time and money by putting the products customers want online and in stores, spokeswoman Tarahaus said.

Hometown Food Co.’s factory in Toledo, Ohio manufactures brands such as Pillsbury, Martha White, Hungry Jack’s, White Lily and Jim Dandy.


Photo:

The Wall Street Journal Silvia Jalas

In February, food distributor Sysco warned its suppliers about fees to begin assessing data missing, such as partial orders, billing discrepancies, and nutritional information, according to a correspondence read by the Journal. The fee came into effect in April. Sysco also told its suppliers that it expects to place orders before orders from other customers.

“We believe that all supplier partners covered by these policies are capable of meeting them,” said Sysco spokeswoman Shannon Mutschler, who said this would help restaurant customers reopen. I added.

As the economy recovers, the tone changes as companies are returning to business as usual. Restaurants have increased seating in the dining room, grocery stores have resumed service at salads and hot food bars, and businesses are bringing more people back to the office.

Albertsons Cos, based in Boise, Idaho. Retailers, including, said they were having a hard time securing some products, such as cleaning agents such as spices and detergents. Albertsons, which operates supermarket chains such as Safeway and Jewel-Osco, has regained fees in some categories, said CEO Vivek Sankaran.

Will the coronavirus pandemic make a long-term change in the way we buy food? To better understand the challenges facing grocery stores, WSJ’s Alexander Hotz spoke with industry insiders, shopkeepers and Wal-Mart executives.

“It’s about providing a better demand signal to our suppliers and making things easier,” said Sankaran.

Prices are common among retailers, but in addition to rising prices for fuel, transportation, labor, and some raw materials, they are raising supplier costs. Manufacturers are already raising prices for a variety of food and other consumer goods. “Almost everything is going well,” said Jagtar Nijjar, director of imports and commodities at distributor Gordon Food Service Inc.

Manufacturers are already raising the prices of various foods.


Photo:

The Wall Street Journal Silvia Jalas

Wise Pie is paying as much as $ 4,000 to ship pizza in bulk, President Season Elliott said, compared to about $ 1,800 in August. The price of cheese has almost doubled. Wise Pies uses more contractors to make and deliver pizza. This was detrimental to profits, but helped meet the demands of distributors and retailers. The company has not raised prices.

“We all want the same thing, to avoid out of stock,” Elliott said.

Thang Nguyen-Le, CEO of ramen brand Simply Food, said he was facing fines for delays and was concerned that retailers could switch to competitors if they couldn’t deliver. He doesn’t need either of his products, but he pays for refrigerated shipping containers and air freight.

“If you’re at a loss, you need to keep space on the shelves,” he said.

Utah-based distributor Nicholas & Company struggled to procure milk and cream, so its co-CEO Nicole Muscondis arranged to buy milk from oversupplied dairy farmers. I tried. However, a shortage of resin after a winter storm closed a chemical plant in the southern United States prevented milk processors from procuring the plastic jugs needed to bottle it.

Pillsbury Brownie Mix is ​​Hometown Food Co. Will be loaded onto the truck.


Photo:

The Wall Street Journal Silvia Jalas

“It has a domino effect,” said Mouskondis, who offers restaurants such as Subway and Panda Express.

Many restaurants do not pay for some orders placed before the pandemic, as they are demanding more food to resume. Distributors, including Mouskondis, have several restaurants in their payment plans. “You can’t get the lettuce back,” she said.

According to Muscondis, some restaurant chains could be fined for late deliveries, and some restaurant chains have long-standing suppliers with the products they need. I replaced it with a competitor who said it could be procured.

Share your thoughts

Did you notice a food shortage in your area due to supply chain problems? Join the conversation below.

Suzanne Rajczi, CEO of New York-based distributor Ginsberg’s Foods, said he overordered many items to increase the likelihood that customers would get the products they wanted. For example, she is struggling to procure blue cheese last year as a cheese maker reduced inventory of varieties that take months to mature, such as Gorgonzola and Roquefort.

“We can’t make blue cheese any faster,” Rajczi said.

The Hometown Food Co. factory has approximately 175 trailers for transporting finished products.


Photo:

The Wall Street Journal Silvia Jalas

Write to Jesse Newman (jesse.newman@wsj.com), Jaewon Kang (jaewon.kang@wsj.com), Annie Gasparro (annie.gasparro@wsj.com)

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From grocery stores, restaurants to suppliers: hurry up and make more

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