Part 3 of our 6-part series continues today to help the foodservice industry understand what food distributors are doing to manage inventory uncertainties. As a second wave of COVID-19 continues to spread in Europe, we’ve been gathering some intel from our Dutch customers that may prove useful in this area.
What else is the food industry doing to cope with COVID-19 disruption?
Trend #3: Consumers May Pay for Scarcity
Scarcity is making food prices go up, which raises the question, ‘Will consumers foot the bill?’
Here’s the problem, as we’re seeing in the Netherlands and in many parts of the world. Food business owners are being forced to spend more to make the necessary adjustments for reopening. Yet, they are seeing lower revenues because only 30 shoppers are allowed in the store at a time.
So who pays for that loss? Consumers.
Consumers are seeing higher prices on scarce items. It’s an age-old rule of economics. Still, will they actually be willing to pay? Social media outcries are proving that no one likes a profiteer during a crisis.
Understanding customer willingness to pay is a key advantage for foodservice providers. Advanced price optimization software is out there to help companies anticipate the financial outcome of a price adjustment to minimize lost sales or damage to brand reputation.