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Inflation & Supply Chain Update

Angie Dark
Angie Dark | May 26, 2022

Never has the issue of inflation and supply chain management been front and center the way it is in today’s environment.

Foodservice experienced 13%-16% inflation for Q1 of 2022 and economists anticipate similar levels through the year.

Unprecedented challenges in six core areas of business are also projected to impact the food service industry through the rest of the year, causing longer lead-times, severe product shortages, increased costs and added frustration.

We realize the significant impact that these challenges have on your business, and we greatly appreciate your ongoing patience and collaboration as we navigate through these unique circumstances together. Martin Bros. is putting practices in place to minimize impact on our customers.

Here are the six areas of business being affected:

  1. LABOR
    Wage and salary inflation has had significant impact across the supply chain in critical, hard-to-fill manufacturing roles. These labor shortages continue to present challenges for factories who are unable to run full shifts, therefore reducing output and contributing to SKU rationalization.

    The industry is experiencing a shortage of supply to meet product demands in part due to a lack of truck drivers, shortages of vehicles for hauling and the effects of an economic rebound across the country. Fuel pricing increases contribute to additional product inflation. Congestion at worldwide seaports continues to create delays lasting months. The cost of ocean freight is at record highs with no sign of declining.

    Supply is at its lowest stock level in five years due to a global demand spike, weather impacts and global unrest, which in turn have caused increases to the cost of energy.

    Products have been impacted by inflation, increased demand, weather events, shortages in raw materials, labor and a supply/demand imbalance with the consumer.

    Growing legislation banning foam and plastics has added to demand for paper-based products as replacements while adding cost. Companies are making increased investments to achieve net zero impact to their carbon footprint.

    Increased demands are impacting all segments due to growth in at-home delivery as well as the need for single service and grab & go. Furthermore, raw material shortages such as resin, lumber and corrugate have contributed to supply issues of all items using those goods for packaging.

For detailed information about what Martin Bros. is doing to minimize impact on our customers, please click here.


Questions or comments about this article? Feel free to contact us!


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