Restaurant recovery is accelerating, according to Sysco
After a turbulent year that resulted in the closure of thousands of independent operators and the unemployment of millions of foodservice workers, Sysco Corp. is facilitating the reconstruction of restaurants.
The National Restaurant Association reports that over 17% of restaurants closed their doors for good in 2020. Together with the organization, Sysco has lobbied for restaurant relief and assisted operators in the application process.
“We were the first distributor to lobby on behalf of our customers for that support, and we were the first to offer educational webinars to our independent customers on how they can access the funds available to them via the PPP programs,” stated Neil Russell, senior vice president of corporate affairs and chief communications officer at Sysco, during a presentation on February 16 at the Consumer Analyst Group of New York virtual meeting. “Today, bipartisan efforts are being made to advance the RESTAURANTS Act and provide restaurants with extra funding, which will enable them to finance their operations by buying food and supplies from their distributor in addition to paying their staff.”
Sysco is preparing for a comeback in 2021 and beyond with the distribution of vaccines across the nation and the easing or lifting of local restaurant restrictions. The company anticipates that its international business will recover more slowly than its US business.
“Given the lockdowns in specific countries, our international business faces some challenges,” Sysco President, Director, and CEO Kevin Hourican stated. “We’ll need more time to heal from that. But there are encouraging signs in our US business. Given the continued relaxation of restrictions, we are enthusiastic about the prospect of customers returning to the restaurants in a short amount of time.
Ahead of a business turnaround, the company is investing in staffing and inventory.
“The hardest part of the COVID challenge is in the recovery window when you need to build back inventory and staffing and you’re not receiving the cash inflows from your customers to pay for those products and to support the payroll of the people,” Mr. Hourican stated. This has been the case since the beginning of the crisis. “Sysco is in a unique position to support our customers by making those unwavering investments, allowing us to accelerate our growth faster than the recovery.”
Sysco introduced the Restaurants Rising program in December, waiving delivery minimums on regularly scheduled order delivery days. As part of the program, the company is not reducing the frequency of deliveries, as many foodservice distributors did when volumes declined.
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“Compared to other foodservice distributors in this industry, we’re helping small independent customers more,” Mr. Hourican stated. “In this industry, no order minimums are a big deal.”
The company is making investments in its technological infrastructure in order to enhance customer service as the pandemic fades. It has made updates to its Sysco Shop platform to increase pricing competitiveness and transparency.
Sysco is also using its knowledge to assist restaurant owners in streamlining their menus so they can concentrate on making a profit.
Mr. Hourican stated, “We can connect them to a delivery aggregator.” “We can assist them in enhancing their website to create an online menu that is clickable and orderable. We can provide them with solutions for outdoor dining, for example. We’re assisting our clients in finding resources so they can buy patio furniture and outdoor heaters to prolong the selling season during the winter.