Restaurant Trends: Labor Shortage Pushes Supply Chain Transparency Forward
By John Orme, Vice President, Business Development, NXTPoint Logistics
When the COVID-19 pandemic first hit the US, massive temporary layoffs drove a spike in unemployment. Nearly every industry, sector and state felt the impact. In April 2020, the unemployment rate reached 14.8%—the highest rate ever seen since data collection started in 1948. Today, unemployment rates are still sitting higher in June 2021 (6%) than they were pre-pandemic in Feb. 2020 (3.5%), forcing companies to find ways to do more with less workers out of sheer necessity.
For the restaurant industry, the labor shortage is hitting more than just dining rooms. Restaurant openings, refreshes and rebrand projects are at risk as supply chains are weakened and the demand for day labor rises. To battle a lack of available labor, as well as keep up with customer experience expectations, restaurants must implement more technology to continue to automate processes and elevate customer experiences. With fewer resources, restaurants are relying on transparency through technology to better manage projects and help elevate some of these challenges.
More Transparency for Better Outcomes
As a FF&E restaurant logistics provider, are seeing the manual process companies relied on in the past of using internal spreadsheets, making calls, sending emails and consistently following up with multiple contacts to see where products are in the supply chain are simply too time consuming with reduced staff and leave too much room for error. With fewer resources at a corporate level, and a bigger reliance on remote positions, many restaurants are leaning on project managers to handle multiple projects happening around the nation simultaneously. This means project managers are navigating running operations anywhere from across the state to half-way around the world.
Today, companies need one access point to have visibility into the supply chain. The ability to monitor where products are and get details from manufacturing through destination is essential to ensuring timelines are protected and deadlines are met. Having the ability to log into a computer, tablet, or even smart phone anytime day or night and see exactly where products are, from shipping, consolidation and kitting to delivery and installation, can save companies thousands of dollars.
For example, one of our customers had a last-minute shipment delay, which pushed product to hit the jobsite two days later than expected. Because they had the visibility into their supply chain to immediately see this change, they were able to realign onsite labor before it impacted the project budget. This level of visibility helps reduce risk for high-value furniture, fixtures, and equipment (FF&E). We’ve had customers come to us after a provider left expensive equipment in the rain at a job site because there was a lack of communication and control over delivery timelines.
Companies that have longer delays can find more creative solutions, like pulling products from storage that will ship faster to save timelines. Logistics partners with real-time warehouse inventory management systems that give visibility into where products are located and at the same time can react quickly to customer needs are essential to overcoming unexpected complications.
Another issue restaurants continue to face is visibility through the final mile. Because day labor is even harder to schedule than in the past, project managers are hungrier than ever for technology that tracks every aspect of the last mile and installation process.
Did the installer arrive on time? Is the project complete? Was it done properly? All these answers are left to chance without a proper system in place and key checkpoints, such as quality checklists, digital photos and service acknowledgements. When project managers know exactly what’s happening onsite, they can properly plan for next steps and continue to push projects forward.
This level of visibility and accountability throughout the supply chain is helping restaurants see where there are breakdowns and giving a snapshot at what’s working and what isn’t to make better, faster, data-driven decisions around their supply chains.
The Driving Force Behind Innovation
While we will see a focus on better technology to strengthen supply chains continue in the coming years, the businesses that will gain the most from it are those who choose the right partner that continues to push for innovation. While some companies will get left in the dust without instituting this technology, others will do it to keep up, but they may not do it well. Unfortunately, the right technology can only take a customer so far. If logistics management providers aren’t investing in the right people pushing the technology forward, ensuring the information is accurate and continuing to innovate on a regular basis, restaurants won’t see maximum results and cost savings.