As the summer solstice approaches, the list of interesting food and beverage news stories seems to be growing along with the daylight hours.

  • The food delivery sector reckoned with business realities.
  • Workers sought better compensation.
  • Dads dusted off their grills.

Over-promising, Under-delivering

Food delivery remains a very hot topic for both foodservice and retail. The business realities of food delivery are sinking in as most app-based delivery services have run on investment capital and have yet to turn a profit. In light of this, delivery companies and food outlets are trying to cover that final link to get products to consumers.

  • An increased minimum wage of $17.96 per hour for delivery workers in New York City will take effect on July 12 (The Associated Press). “Our delivery workers have consistently delivered for us — now, we are delivering for them,” Mayor Eric Adams said in a statement.
  • A New York Times article summarized comments from Kristin Sharp, the chief executive of Flex — a trade association that represents delivery apps such as DoorDash, Uber Eats and Instacart. According to Sharp, “The added costs to companies could result in higher fees for consumers, and the reduction or possible elimination of tips for workers.”
  • As a further indication of headwinds for foodservice delivery, Grubhub announced laying off 400 workers, or 15% of its office-based workforce (Chicago Sun-Times).
  • Supermarket News reported that ship-to-home orders fell 17% versus last year and delivery declined 11.7%. Pick-up orders, by contrast, have increased by about 9%.
  • Uber launched Uber Health on June 13. According to Axios, this matters because: “It’s the latest expansion of Uber’s health care arm and part of a broader push by investors and companies that see opportunity partnering with providers to address nutrition and other social determinants of health.”
  • Nation’s Restaurant News described Starbucks’ new delivery-only locations. At a conference, CFO Rachel Ruggeri explained, “We look at delivery-only as a way to take the complexity out of the existing stores, and it creates a better experience for both the partner and the customer.”

Wage Rage

The wide variety of companies involved in food, beverage and agriculture production mirrors the mixed signals of the broader economy: some sectors face labor shortages, while others lay off workers and unions negotiate contracts for months, while technology subtly influences consumers’ tips.

  • The National Restaurant Association championed the Essential Workers for Economic Advancement Act as a means of securing visas for workers who are willing to fill vacant positions in the foodservice industry.
  • Meanwhile, meat processors HyLife and Tyson Foods joined Grubhub in laying off workers.
  • Shipping of food goods through West Coast ports had slowed substantially during the past year of negotiations. Last week, industry groups including the U.S. Meat Export Federation (Feedstuffs) and the National Retail Federation, called for intervention from the Biden administration.
  • On June 14, the International Longshore and Warehouse Union and operators of West Coast ports reached a tentative agreement on a six-year contract (Reuters).
  • The Service Employees International Union welcomed a National Labor Relations Board ruling on June 13 that overturned a Trump administration definition of independent contractors. SEIU President Mary Kay Henry called the decision “an incredible victory for … the ability to collectively bargain for a better workplace.”
  • Tipping has long been controversial, with much consternation around the separate minimum wage for employees who receive tips. But the proliferation of point-of-sale systems that automatically suggest certain tip rates have a 66% disapproval rate, according to a Bankrate survey.
  • The survey caused a stir, with headlines featuring phrases like “tipflation” (CBS News) and “gratuitous gratuity” (CNN). Bon Appétit emphasized that much of the pushback on tipping suggestions is because “American customers are being encouraged to tip in settings where, just a couple of years ago, doing so was unprecedented.”
  • Even industry insiders have attempted to undermine the institution of tipping in the past. Restaurateur Danny Meyer eliminated tipping at his Union Square Hospitality Group restaurants beginning in 2015, but ultimately reverted to shared tipping during the COVID-19 pandemic.

“There’s so much confusion regarding who to tip, and if so, how much. … technology makes it easier to tip some people and harder to tip others — as travelers who are short on cash can attest.”

Ted Rossman, Senior Industry Analyst, Bankrate

Summertime ‘Ques

With summer in full swing and Father’s Day coming up on Sunday, we’ve noted an uptick in grilling coverage. Also, as a shameless BR client plug, check out Food & Beverage Magazine’s top picks for summer featuring Seaboard Foods (Page 58) and McCain Foods (Page 52).

Worth Reading

Honoring Juneteenth

With its status as a federal holiday, food will be a focus for Juneteenth celebrations. FMI, The Food Industry Association, contrasted “the joy and the solemnity of this holiday.” Eater interviewed Houston-based chefs for food recommendations. Los Angeles Times assistant food editor Danielle Dorsey explained the rationale behind eating red foods.

Artificial Intelligence Does Fast Food

The Wall Street Journal reported that White Castle and other fast-food chains have started to test AI-enabled chatbots in their drive-throughs. While many operators are salivating at the prospect of using the innovation to increase efficiency and enhance behind-the-counter productivity, numerous customers have voiced initial displeasure with misplaced orders and a lack of human engagement. We’ve noticed that artificial intelligence and genuine stupidity are often indistinguishable.

More Hype Than Bite

According to a study from Rabobank, the end is near for disruptive food products. Food Processing reported that in the coming years, the consumer food industry will see fewer total disruptive innovations as large processors refocus their attention on incremental changes. Sure … until private equity crowns the next wave of disruptors.

More Sesame, Anyone?

In a turn of events no allergy sufferer saw coming, legislation requiring that food manufacturers label sesame on their products led to, oddly, more products with sesame. Wall Street Journal writer Kristina Peterson pointed out that companies found it was safer to add an ingredient such as sesame flour and label it, rather than certify they had eliminated all traces of it. The result is fewer sesame-free options and added risk for the people the law was intended to protect.

Where We at on Sat Fat?

The health impact of saturated fat has long been debated in the nutrition science world. In fact, fat got a huge boost in 2014 when Time declared an end to the war on it. Some think it’s harmful and others think it’s benign or even beneficial. Washington Post columnist Tamar Haspel tackled the saturated fat saga with a range of experts from cardiologists to nutritionists. But at the end of the day, isn’t life better with butter?

Definition by Exclusion

Food Ingredients First stated that consumers are looking for transparency and trust in brands, often relying on “free-from” claims to make informed choices. Soy protein’s popularity is starting to crumble like a gluten-free cookie, while pea, canola and fava proteins rise as worthy replacements. As in many other cases, what’s on the product label continues to push the industry to boost nutritional profiles. We’re wishing the “free-from calories” label was on them all.