Across the country, the entire foodservice industry is experiencing massive changes in food supply and pricing due to COVID-19, labor shortages and record high pricing in the commodity markets. It's in times like this, that our commitment to Our Support, Your Success makes ALL the difference. While other business owners are going at it alone, you have our team of experts working to ensure that you remain profitable during this time.
Market Update
John Atkinson, Vice President of Purchasing at PFSbrands
What are we seeing in the chicken market?
- The cost of chicken tenders has increased over 67% since the beginning of the year.*
- The cost of chicken breast meat has increased 140% since the beginning of the year.**
What is causing these price increases?
1. Supply. There is not enough supply in the market to support all of the demand for chicken across the nation. This is similar to a housing market when there are not enough homes available. You see homes go for well above list price, and there are bidding wars. That's very similar to what is happening in the chicken market right now. People are willing to pay premiums to get chicken products.
2. Rising Costs for Manufacturers. The second big factor on that pricing is increased costs for the chicken manufacturers. What's causing their costs to rise?
- Increased input costs for items like feed for chickens.
- Increased labor costs. They are experiencing the same labor struggles you are.
That combination between supply and rising costs is what is causing this market inflation that we are seeing right now.
*Per Urner Barry Jumbo Tender Market as of 5/26/21, **Urner Barry Jumbo Breast Meat Market as of 5/26/21
Pricing Tutorial
Kyle Menges, Controller at PFSbrands
Key Takeaways:
- Increase your menu prices to keep your gross profit margin and ensure profitability.
- When food cost prices stabilize, continue to keep your menu prices at the new pricing to recoup margin lost during inflationary periods and to gain additional profit moving forward.
SMART Menu Tips
Andy Griffith, Regional Training Specialist
Why the SMART Menu?
- Customer-centric, showcasing your customers' favorite items
- Streamlined menu = streamlined execution. Opportunity for decreased labor if a store chooses to only offer the items on the menu.
- Strategically formatted to push higher margin items and create higher ticket rings.
- All new Champs Chicken locations will be using the SMART menu-- don't be behind the times!
Our Support. Your Success.
Let us know how we can help you as you navigate this inflationary period. Our Customer Success Team is here to help!
Customer.Success@PFSbrands.com |(855) 632-3373