Linchi Kwok, Ph.D.

While inflation is finally cooling a little bit, nothing seems to stop the soaring food prices. Prices of margarine and butter in December 2022 increased 44% and 31%, respectively, from a year ago. Egg prices had even gone up by 60% ( Brooks, 2023 )   Inflation is just one factor driving up the food prices   Inflation and the recent bird flu outbreak might have just created a perfect storm to jack up egg prices. Plus, it also happened that more states began transitioning to cage-free eggs around the same time. Effective in 2023, all eggs sold in California must be laid by hens living in cage-free or better conditions. Likewise, a similar bill is now under review by the Senate Agriculture Committee in New York. Leave the war in Ukraine aside; prices for eggs and other essential food items (e.g., baked goods) are unlikely to drop soon.    Food banks are struggling       As a result of soaring food prices, food banks only afford to buy fewer items wi...

  Are you feeling hopeful for the new year?   As many of us have left the pandemic behind in 2022 and begun traveling again, airlines have begun seeing profits. Some tourist destinations also recorded the highest-ever RevPAR (revenue per available room, a key hotel performance indicator).   The foodservice industry is recovering too. According to   National Restaurant Association ’s forecast in January 2022, the foodservice industry would make $898 billion in sales for the year, exceeding $864 billion in 2019. Entering 2023, will restaurant sales continue to grow? Or, will high inflation and uncertainty of the economic outlook negatively affect sales in the foodservice industry?      Regardless of where we stand, the foodservice industry must overcome many big operational challenges to thrive in 2023. To start off, let’s visit food and labor costs, the two costliest items on the balance sheet.      Food prices are unlikely to fall  ...

People tend to forget. As the world is finally moving out of the pandemic, will people quickly forget their experience in the last three years? Surely, we will leave the masks and social distancing behind, but a few of those changes due to the pandemic will most likely stay with us in the post-pandemic era.     Off-premises services will stay essential but with a slower growth pace   Off-premises services, such as curbside pickup, delivery, and grab-n-go, are not new. Still, when the pandemic hit, many consumers were forced to try curbside pickup or delivery services for the first time. Off-premises service also became the only distribution channel available for restaurants. It did not take long for consumers to fall in love with curbside pickup and delivery services. Restaurants like it, too. Many have rolled out new store designs to embrace the off-premises dining trend, as suggested in my earlier discussion.     A recent big data report ( Beltrani, 2022 ), ho...

The U.S. just added 263,000 jobs in November, leaving an unchanged unemployment rate of 3.7% ( Bartash, 2022 ). The combined effects of a tight labor market and high inflation have resulted in a sharp rise in wages, pushing the average hourly wage to $32.82. It becomes almost impossible for food service operators to keep up with the wage hikes. The good news is our food service providers have come up with several solutions to streamline operations.      Restaurants rolled out new store design plans   As an immediate response to consumer demands for contactless, self-services during the pandemic, many restaurants expanded their curbside pickup and delivery services. Panera Bread and Taco Bell, among others, quickly rolled out new and often smaller store designs with more drive-thru lanes, less seating, and more contactless digital service ( Lucas, 2021 ). Modeling a ghost kitchen concept, Chipotle opened its Digital Kitchen back in 2020, only providing off-premises or...

It is time to say goodbye to 2022, a year of healing and recovery from the pandemic. A few of our hospitality students weighed their perspectives on the industry’s 2023 outlook.     The student profiles     Bianca Louise N. Del Castillo , a second-year master’s student and competed in the STR Student Market Analysis Competition. She worked in hotels and travel agencies before joining the program.   Brandon J. Oceguera , a first-year student, working in a country club in Orange County (OC). He worked at the OC Fair for the past five years, with a total of seven years of experience. He loved to cook, eat, and golf.   Jordan A. Garcia-Nazarit , a veteran and a junior with a hospitality major. He works in the dining commons at Cal Poly Pomona.      The industry trends observed by our students   Customer-focused technologies, labor shortages, and consumer demands for healthier diets came to the top of our students’ minds. They commented: ...