Federal Reserve Bank economist David Oppedahl tells International Foodservice Manufacturers Association gathering that consumers are eating in new ways.
The U.S. foodservice industry poised for a revival this year, a Federal Reserve Bank economist told the Chain Operators Exchange 2021 on Monday.
“This coming year will see a revival in the food sector in particular,” said David Oppedahl, senior business economist at the Federal Reserve Bank of Chicago, in a presentation at COEX, which is sponsored annually by the International Foodservice Manufacturers Association.
Oppedahl told COEX, which is being held virtually this year because of COVID-19 pandemic, said the pandemic will undoubtedly change consumer behavior.
“You know people are coming back in, eating in new ways, and they've been exposed to some additional techniques and cooking and so there's a lot of activity and a lot of interest in food and if that's a positive for the sector,” Oppedahl said.
Oppedahl noted that the U.S. economy is expected to expand in 2021-2023 after taking a dive during the pandemic year of 2020 as vaccines become more widely available.
“The worst of the pandemic is behind us, and, in the next couple years, economic growth will be moving toward the long-term trend, which is about 2%,” he said.
Employment is expected to continue rising as well, Oppedahl said. The current unemployment rate is at about 6%.
“This year, that should be down closer to 4% or a little under that,” he said.
Inflation will continue to impact food prices, Oppedahl added, and those are likely to remain elevated and will affect the bottom line on earnings.
Oppedahl followed Charlie Morrison, CEO of Dallas-based Wingstop Inc., and Katherine Twells, senior vice president for customer excellent at the Coca-Cola Co., in presenting COEX 2021’s inaugural session.
Morrison said the 1,538-unit Wingstop, which weathered the pandemic with a domestic same-store sales increase of 21.4% in 2020 through a reliance on digital sales, was like many restaurant brands in facing a consumer with new habits.
“I think all restaurant concepts are going to be facing similar challenges to Wingstop,” Morrison said, adding that guest preferences remain in flux.
The brand closed its dining rooms during the pandemic. “I think we're seeing people start to reopen,” he said. “People are going back they certainly want to get out of their homes and be amongst people.”
Morrison said Wingstop is listening closely to guest preferences.
“I think the biggest challenge is continuing to stay relevant, to make sure that we're accessible that we're listening to our guests and that all of those things are factored into how we position the brand long term,” he said.
“We still have restaurants with dining rooms probably,” he said. But he added that the brand would consider virtual restaurants, which it has tested in the United Kingdom and in the United States.
Wingstop is preparing “to adapt to that new and ever-changing world we’re going to see,” Morrison said.