US & Global Economic Impact Analysis and Forecasts

Freedonia analysts and economists are sharing their insights on how major events are impacting different parts of the US and global economies.

California Barring Unauthorized Restaurant Food Delivery Starting in 2021

On September 24, California Governor Gavin Newsom signed AB 2149 – the Fair Food Delivery Act. This law will bar last-mile delivery firms such as DoorDash, Grubhub, and Uber Eats from delivering food from restaurants without a signed agreement with the restaurant owner.

DoorDash has long used this tactic, claiming it’s a way to introduce new customers and show restaurants how DoorDash operations add value to their business. Others, such as Grubhub, have concentrated on “partnered” restaurants, only more recently adding “non-partnered” restaurants in areas where they have fewer partnered options to offer customers.

Independent restaurants have typically been more wary of participating with these delivery firms and have chafed against “non-partner” delivery operations. They note that they do not have control over the outcome of the delivery and the quality of the food upon arrival, but they would be blamed – rather than the app – if something were to go wrong. They also worry if prices and menu options are being accurately communicated to customers.

This is part of the continuing evolution of the relationship between last-mile delivery firms and the restaurants themselves. Restaurants are increasingly interested in keeping delivery operations in-house or having more control of the delivery experience in light of the business shift toward carryout and delivery during the coronavirus pandemic.  

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including Food Carryout & Delivery and the companion report with timely consumer insights from our in-house survey capabilities, as well as US Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era and US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus.

The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including US Restaurant Reopening: COVID-19 Impact on Supplies, Global Foodservice, Surface Disinfecting Wipes, and Global Industrial & Institutional Disinfectants & Sanitizers, as well as packaging industry titles such as Foodservice Single-Use Products, Global Foodservice Single-Use Products, and Global Single-Use Packaging Regulations.

Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Food & Beverage      Services    

After the Spike in the Spring, Meat Prices Are Falling

Meat prices at the grocery went up a lot in the 2nd quarter of 2020. They were driven by factors such as

  • grocery hoarding as consumers stocked up (including home freezers) for stay-at-home orders
  • supply chain challenges as grocery sales were way up, but commercial and institutional sales fell hard as schools and restaurants closed
  • meat processing companies closed facilities as COVID outbreaks took hold

So what’s behind the change now?

  • Consumer grocery shopping habits have leveled off as the initial panic has died down and some are now eating through their freezer stocks.
  • Meat processors are operating as usual, even with coronavirus safety measures in place.
  • Exports are down, as consumers are eating at home and tightening budgets leading to reduced meat consumption.
  • Supplies of live animals are up as cattle and hogs that did not go to slaughter as scheduled in the spring simply got fatter and a backlog remains, even though the fattier beef would otherwise generate higher prices.

As a result:

  • Farmers still struggle to make money on their live animals to be sold for meat.
  • Processors have a glut of supply, even as they worry about a return of the virus and additional shortages.
  • Packaged food companies that use meat (e.g., canned soups, frozen dinners) are starting to rebuild their supplies stocks while remaining concerned about additional future disruptions.
  • Consumers are seeing discounts on meat at grocery stores after seeing limits on purchase amounts in the spring. Those who might have sampled meat-free or plant-forward options when prices were high are migrating back toward more affordable meats.

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus. The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including packaging industry titles such as Meat, Poultry & Seafood Packaging and Molded Pulp Packaging.

Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Food & Beverage    

COVID-Era Foodservice: What’s Next for Cold Weather Months?

The foodservice industry has been creatively innovating and working to solve the challenges of the pandemic era since the coronavirus spread and restaurants and bars were among the first to close and the last to reopen. While the industry has been working through expanded delivery, carryout, and curbside service options as well as a move to dining outdoors, the challenge of the cold weather months is looming. Here are some ways that the foodservice industry is or could be planning for winter:

  • Drive-thru for more than just fast food. Events, such as this one planned for Los Angeles in October and this one in St. Louis, will bring fine dining food to drive-thru safety and social distancing.
  • Carryout out family meals. As more people are getting tired of cooking, but still need to feed their whole family, more restaurants are responding with prepared or semi-prepared meals in family-friendly sizes that feed 4 or 6 people.
  • Outdoor heaters. Sales of these large space heaters, table heaters, and fire pits are red hot as restaurant and bar operators look to expand the season for comfortable outdoor service.
  • Open-sided tents, pergolas, or other temporary structures. Some are even considering private domes or igloos for individual parties. Cities – such as Chicago ­– are responding with updated regulations and guidelines to be sure that such structures are safe and comply with coronavirus requirements.
  • Changing menus. Spicy food, hearty comfort foods, soups and stews, and hot drinks are all increasingly part of menus that will make outdoor dining, even in cool weather, appealing.
  • Food trucks and ghost kitchens. As more foodservice operations are thinking long-term for COVID troubles, many are investing in more permanent, but still flexible, operations that lower their costs and make it easier to get hot, fresh food to their customers.
  • Special, limited-time menus. Foodservice operators are thinking proactively about the upcoming holiday season, considering smaller carryout versions of traditional Thanksgiving or Christmas meals to allow customers who would have normally gathered with family to still enjoy the food comforts of the season.

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including Food Carryout & Delivery and the companion report with timely consumer insights from our in-house survey capabilities, as well as US Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era and US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus.

The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including US Restaurant Reopening: COVID-19 Impact on Supplies, Global Foodservice, Surface Disinfecting Wipes, and Global Industrial & Institutional Disinfectants & Sanitizers, as well as packaging industry titles such as Foodservice Single-Use Products, Global Foodservice Single-Use Products, and Global Single-Use Packaging Regulations.

Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Food & Beverage    

Got COVID-somnia? Newest Functional Beverage Helps You Sleep

PepsiCo announced that it is releasing a functional water called Driftwell, which is aimed at reducing stress and improving relaxation. The product containers 200g of L-theanine, an amino acid, and 10% of the daily value of magnesium. Some studies have indicated that L-theanine can help improve sleep with fewer disturbances along with other possible benefits.

Driftwell is being offered in blackberry lavender flavor, and is expected to be available online in December and on retail shelves in 1Q 2021.

This product capitalizes on consumer shifts to functional food and beverage items that have some sort of health benefit attached to them. This has been particularly important as consumers in the pandemic era look for ways to improve their body’s immune response or mitigate the effects of the current world.

Reponses to the August edition of the Freedonia National Online Consumer Survey show how some of these trends play out:

  • 46% of respondents strongly or somewhat agreed that the coronavirus pandemic was having a negative effect on their ability to sleep.
  • 78% of respondents indicated that they were strongly or somewhat concerned that the current coronavirus was a health threat to them personally.
  • 84% said that they were that they were strongly or somewhat concerned about the pandemic as a health threat to their family.

For more information and discussion of opportunities, see Packaged Facts’ food- and beverage-related reports, including US Beverage Market Outlook 2020: Grocery Shopping & Personal Consumption in the Coronavirus Era, US Food Market Outlook 2020: Home Cooking, Grocery Shopping & Food Trends in the Age of Coronavirus, and Food Carryout & Delivery as well as the companion report with timely consumer insights from our in-house survey capabilities. The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including packaging industry titles such as Foodservice Single-Use Products, Global Foodservice Single-Use Products, and Global Single-Use Packaging Regulations. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Food & Beverage      Healthcare & Life Sciences    

Food Carryout & Delivery Trash – A Modern Dilemma Intensified by Pandemic Eating Habits

A Washington Post restaurant critic recently took a hard look at the trash (unrecyclable) that resulted from his food takeout habit. He noted, “The stream of paper, plastic, aluminum and glass that came through my door from roughly 30 orders shocked and depressed me. I accumulated enough waste to fill two recycling containers — nearly 100 gallons of space — not to mention a torrent of guilt.”

Many consumers are feeling that way, particularly as their dine-in habit shifted to delivery and takeaway, which resulted in a shift from reusable dinnerware and utensils to single-use dinnerware and utensils. This spike in single-use products is even higher as restaurants are using extra packaging, especially bags and wraps, to show customers that they are being as safe and hygienic as possible. Additionally, as more complex meals and family-style kits are being offered for carryout, restaurants are using even more containers per order to maintain the integrity of the food until the consumer eats it.

So what can consumers who want to limit their trash do?

  • seek out restaurants that use returnable or reusable containers
  • look for restaurants that use paper-based containers rather than plastic ones or versions coated in plastic, as multilayered versions and most plastic containers cannot be recycled or composted
  • ask restaurants about their packaging options – to owners, the decision to go green is as much about the push from consumers as it is about the pull from suppliers
  • refuse the disposable utensils, napkins, and straws – especially if you are dining at home where you have your own utensils and napkins
  • skip ordering a drink and use something you have onsite to eliminate the use of cups, lids, straws, and carrying containers
  • order for multiple meals at a time (group with friends/neighbors or think ahead beyond the current meal) so that trips and packaging space are maximized

For more information and discussion of opportunities, see Freedonia’s newly published USRestaurant Reopening Impact Report as well as Packaged Facts’ food- and beverage-related reports, including Food Carryout & Delivery as well as the companion report with timely consumer insights from our in-house survey capabilities. The Freedonia Group’s extensive collection of off-the-shelf research provides a strong complement to packaged food industry analysis, including Global Foodservice and packaging industry titles such as Foodservice Single-Use Products and Global Foodservice Single-Use Products. Freedonia Custom Research is also available for questions requiring tailored market intelligence.

  Covid-19      Food & Beverage      Packaging