Processors Struggle to Fill Surge in Demand

May 7, 2021
As the pandemic winds down, friction between food processors and their trade customers is heating up.

As the pandemic winds down, friction between food processors and their trade customers is heating up.

Supply chain problems and other difficulties are preventing food processors from getting complete orders to retailers and restaurants, the Wall Street Journal reports. This is leading Walmart, Sysco and others to re-impose penalties for late or incomplete orders. The suppliers are struggling with labor shortages, unavailable or suddenly pricey ingredients, shipping problems and other difficulties.

Walmart notified its suppliers last fall that if orders fell below 98% completion, they would be charged a penalty of 3% of the value of the undelivered goods. Sysco issued a similar notification in April.

“We believe all our supplier partners subject to these policies have the capabilities to meet them,” a Sysco spokesperson told the Journal.

The stresses on processors include packaging as well as product. A dairy distributor in Utah found enough milk and cream, but after winter storms shut down manufacturing capacity in the Southwest, it couldn’t source enough plastic resin to blow-mold bottles.

Sponsored Recommendations

Refrigerated transport services you can count on

Ensure product quality from origin to final destination with refrigerated shipping solutions from Schneider.

4 shipping challenges that a dedicated carrier can solve

Navigating the logistics industry is challenging. Find out how a dedicated transportation solution can solve some of the most common shipping challenges.

Dedicated lightweight solution maximizes bottled water payload

A leading bottled water company needed a carrier to transport water from 29 plants to retailers. The challenge? Handling over 46,000 pounds. Read the study.

Recipe for successful growth: Schneider’s dedicated fleet services helps bakery rise

Learn how a large bakery company complimented their private fleet with Schneider Dedicated freight services to increase freight capacity, amplify visibility & reduce costs.