With excess supply during coronavirus closures, restaurants sell their inventory as groceries

While restaurant incomes were crushed in March as operators had to close their dining rooms, supermarkets saw a run on staples such as bread, milk, eggs and toilet paper as consumers stocked up, and as they shifted their purchases from foodservice to grocery stores.

Despite the supply-chain hiccup, the nation’s largest supermarket group, Kroger, saw a 30% year-over-year increase in sales.

A growing number of restaurant chains have responded by selling what they already had access to as groceries.

So have a number of independent restaurants, said Shannon Mutschler, senior director for external communications at restaurant distributor Sysco.

“We’ve seen a number of our restaurant customers convert their dining rooms to a mini-grocery store,” she said. They might also be selling their own food to go, but also milk, eggs and other staples “that their community is having trouble finding at their retail grocer.”

In fact, Sysco has set up a tool kit to help restaurants set up this mini-groceries, or what Sysco calls a “pop up shop” in their dining rooms, available on their web site.

“In response to the empty grocery store shelves across the country, Sysco customers will have an opportunity to stock and sell pantry staples that can be a profitable solution to navigate the current shift in foodservice operations and provide nourishment and a sense of reassurance in your community,” it says in the introduction to the toolkit.

Related:H-E-B sells meals from local restaurants amid COVID-19 pandemic

But don’t expect those shelves to stay empty for long. Mutschler said that supply-chain pipelines aren’t set up to match the rapid shift from foodservice buying to retail buying that happened all at once across the country in March.

However, none of those goods are actually in short supply, so operators shifting to grocery will likely have to compete with fully stocked shelves once again before too long. Nonetheless, Mutschler said that those restaurateurs are providing an important service to their community by playing a new, if temporary, role in supporting the food supply chain.

Click through to see restaurant chains that are shifting to the grocery segment during the coronavirus pandemic.

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Learn how consumer trends are shifting during COVID-19 from our panel of experts on Thursday, May 7.

Contact Bret Thorn at [email protected] 

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