Collaborative Segment Discussions - Business and Industry

Conference Attendees Collaborated on Barriers and Solutions During the 2021 Presidents Conference

At IFMA’s Presidents Conference, both suppliers and Business & Industry (B&I) foodservice operators participated in a session to determine how best to work together. This included a collaborative workshop that encouraged stakeholders to explain challenges in the segment and to then develop solutions and opportunities that would optimize the value chain and enhance business relationships.

The sessions began with a discussion of the framework - or pyramid - that was developed by the Foodservice Leadership Councils (FLC). The strategic plan for each FLC is to provide thought leadership through insights with supply-chain members, which in turn helps to optimize the value chain (or ecosystem) and bring value to all trading partners.

Challenges Faced in the B&I Segment

The challenges discussed by the group were broad and varied, as shown in the table. What was inherent in the discussion, but not documented, was the impact of supply chain disruptions and labor shortages. All attendees agreed these were major, ongoing issues that will likely continue until the pandemic ends.

In addition to the major barriers, sustainability, a convoluted set of middlemen, trade spending, technology, price disparities, and distribution options were all discussed.

Challenge	Details / Comments
Sustainability	Reducing plastics and bulk packaging were very important but then Covid-19 happened. “We’re constantly having the conversation that eco-friendliness is not going away. We’re always looking at what our younger employees want.”
Too Many Intermediaries	One of the biggest challenges to B&I is the number of intermediaries involved in the ecosystem: Foodservice Management Companies (FMCs), GPOs, brokers, distributors, and central kitchens/commissaries. FMCs are in more than 90 percent of B&I accounts, which makes direct communication with client liaisons difficult.
Pricing Transparency	This particularly relates to trade spending and promotions. Operators may use two distributors and find that the prices for the same items are markedly different. Group Purchasing Organizations (GPOs) are a roadblock.
Technology	There are challenges with point-of-sale systems that seem “arcane.” “We are relying on Aramark and Compass for technology, but they are only good at food. Is there something better to use?”
Distribution Timeframe	Distribution is taking too long to reach B&I. “The distribution system in foodservice is one of our biggest issues - it takes a long time for a new product to get through distribution.”

Suggested Solutions to the Challenges

Most of the solutions suggested in the B&I collaboration session centered around improved communication with all intermediaries, fostered/sanctioned by IFMA. Participants believe IFMA has a solid reputation of trust and can help foster regular communication with trading partners to share best practices.

Another solution to developing menu ideas included regular innovation “stations” in B&I accounts where manufacturers can impress new innovations and products on client staff and employees.

Solutions	Details / Comments
IFMA Sanctioned Quarterly Meetings	To stay on trend and to learn the segment complexities, the B&I FLCs believe quarterly sessions with manufacturers would benefit both parties in the long run.
Direct Communication	With FMCs highly penetrated into B&I accounts, operators want manufacturers to directly connect to client liaisons to keep accounts up to date on product introductions and status.
Segment Best Practices	Operators believe there are strong learnings from other segments that collaboration with other FLCs on a periodic basis will enhance success and avoid costly mistakes.
Pop-Up Innovation Sites	Use regular onsite “innovation stations” to showcase new manufacturer products and ideas to the host accounts and self-ops.

The Next Steps for the Councils

In January 2022, the five Foodservice Leadership Councils will reconvene in a live conversation, open to all members, and report on the status of the solutions shared in each session. IFMA will release the dates and times of each session at the end of December, 2021.

About the Foodservice Leadership Councils: In the fall of 2018, several leading operators across different industry segments approached IFMA looking for help. They felt their communities were underserved in the areas of insights, business best practices and more effective connectivity with manufacturers.  They also recognized the opportunity to learn from each other and the broader industry to better serve their customers.

For operators interested in learning more about the ongoing council work and access to upcoming resources, visit IFMAworld.com/council, or contact Jim Green at jgspartan@aol.com. You will receive updates on council activities and have complimentary access to whitepapers, webinars, and conferences.  