FMI: Supermarkets facing a demand issue, not a supply issue
Retailers and manufacturers work together to meet demand, and convey the message that the supply chain is flowing
Michael Browne, Supermarket News
Mar 24, 2020
There is no disruption in the grocery supply chain, according to FMI-The Food Industry Association, and what retailers, manufacturers and consumers have been experiencing during the growing coronavirus pandemic has been the result of unprecedented demand for product. Arlington, Va.-based FMI works with and on behalf of the entire industry to advance a safer, healthier and more efficient consumer food supply chain.
In a briefing on Monday with Supermarket News, Doug Baker, vice president of industry relations at FMI, outlined the challenge that the industry is facing and the steps that retailers and manufacturers are taking to address those.
“We're still seeing the same issues that we were last week,” Baker (left) said. “This is a demand issue. This is not a supply issue. And we've been messaging and asking anybody that gets in a position where they can message locally or nationally to ask customers to only purchase no more than seven to 14 days’ worth of food and supplies. As we're probably all starting to see now, most of those spikes are influenced by information and the daily news feed. So if it's a containment, if it's a quarantine, if it's a shelter-in-place order, then you'll see a spike in sales each time something like that happens. And it doesn't necessarily even have to happen in your own backyard. You just have to hear about it and you're going, ‘Oh, I better go get some stuff because it could be happening here.’”
Baker emphasized that there's no disruption in the supply chain, unlike in a natural disaster. Temporary product shortages can and likely will happen, Baker noted, but supply pacing helps ensure these out-of-stocks are short-lived and that the supply chain can respond.
“If you think about a natural disaster, meaning there's a flood or there's a power outage or there's debris across a major highway, that's an actual disruption of a supply chain,” he said. “Because we don't have those right now, the supply is still flowing. We're just about two to three days behind because the demand has been so unprecedented.”
So what is the industry doing to meet that demand?
For one thing, last week FMI announced...
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