United States, June 15, 2009
|  Restaurants could see their margins squeezed as inflationary pressures return to the commodity markets, especially as the chains find it harder to wean customers off a steady diet of meal deals.
Analysts expect higher ingredient and energy costs for restaurants in 2010, with inflation returning to normal levels after a year when costs increases moderated and, for some items, fell from year-ago levels. That could make it harder for chains to continue with the aggressive stream of coupons, buy-one- get-one-free offers and other promotions to bring customers into their doors.
"There's no sign of a pullback yet on discounting," Barclays Capital analyst Jeffrey Bernstein said in an interview. But, "if you see a return to inflation in 2010, it'll prove more challenging to offer these deals." | | | |
| United States, May 27, 2009
|  According to Hank Cardello, food industry expert and author of Stuffed: An Insider’s Look at Who’s REALLY Making America Fat, the same problems that have menaced the Detroit auto industry could soon plague the food industry. If food processors don’t wake up to the emerging trends of healthfulness in food and stop producing overweight foods, they could face a fate similar to auto manufacturers who continued to produce overweight cars with a focus on short-term profits and a lack of innovation.
Cardello, a former executive at Coca-Cola and other major food processors, compares gas guzzlers such as SUVs, big trucks and Hummers to “weapons of mass consumption.” He cites as examples: Hardee’s Monster Thickburgers, weighing in at 1,420 calories, and 7-11’s Double Big Gulps at more than 600 calories. While both industries pursued short-term profits in the name of “bigger is better,” the auto industry found itself behind the market trends, and the food industry may soon face the same problem as increasing numbers of consumers demand more healthy food.
Cardello says when gas prices rose to $4 per gallon, consumers quickly began to look for more efficient cars. The auto manufacturers missed the market signal that “smaller is better.” With the food industry supplying 29% more calories than in the 1950s, and more consumers favoring the healthy choice instead of the large portion, traditional best sellers are finding they are not in step with the changing consumer trend. | | | |
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