May 15, 2020
Friday by Noon:
News of a merger between Uber and Grubhub drove delivery discussions as the coronavirus crisis continues to cast a long shadow. A handful of heavy hitters offered opinions on this week’s topics:
- Delivery companies merge under pressure.
- Workers’ stories get heard.
- Retailers adapt to the new normal.
“Following a natural disaster, restaurants are the last businesses to reopen and to start recovery. When it’s one town or one state, we rally to help those restaurants. This is a nationwide disaster that’s going to need a nationwide plan for restaurants to recover.”Sean Kennedy, National Restaurant Association
Delivery Under Pressure
With most Americans stuck at home, the coronavirus crisis has increased demand for food delivery services. Merger and earnings talk dominated discussions this week. But the increasing importance of delivery for restaurants’ income has also drawn the attention of city governments.
- On May 12, The Wall Street Journal broke news that Uber offered to buy Grubhub. A Grubhub press release did not deny the report.
- Bloomberg emphasized the merger’s antitrust concerns. The two companies would combine for 55% of the food delivery market, while rival DoorDash has a 35% share.
- Politico outlined a trend of major cities imposing limits on the fees that delivery companies charge to restaurants while lockdown restrictions are in place.
- On May 5, Washington D.C. approved a limit of 15% (The Washington Post) and New York City passed a 20% cap on May 13 (Restaurant Hospitality).
- Chicago Tribune reported on May 12 that Chicago had established transparency requirements for delivery fees.
- Restaurant Business writer Jonathan Maze commented, “The fundamental challenges facing the industry haven’t gone away. A delivery order remains expensive for the customer — and will be more expensive once providers have to shift more costs onto consumers.”
- As states relax alcohol delivery laws, teenagers have once again skirted authorities. Food & Wine reports that California warned alcohol distributors they’re “ultimately responsible” if products end up in minors’ hands. It’s adorable how they used “if” instead of “when.”
The topic of workers continues to anchor many conversations as journalists and consumer groups gain more insights into the situation on farms, packing plants, restaurants and grocery stores. Recent discussions capture the perspective of frontline workers, some of whom are taking matters into their own hands.
- The National Restaurant Association pointed out that the restaurant employment level is the lowest it’s been in 30 years and — at 8 million jobs lost — restaurants and bars have lost nearly three times more jobs than any other industry.
- New York Times columnist Nicholas Kristoff compared the plight of fast food workers here to those in Europe in an opinion piece titled “McDonald’s Workers in Denmark Pity Us.”
- Influential news blog BillMoyers.com amplified a Civil Eats piece from May 8 in which “a celebrated peach farmer and author who often works in solitude talks to food leaders Michael Pollan, Alice Waters, Raj Patel, and others about how food connects us all.”
- On May 12, Politico journalists Liz Crampton and Helena Bottmiller Evich appeared in a behind-the-scenes video describing the field work behind their in-depth feature on farmworkers. The authors warn that if better protections are not provided to farmworkers, they will suffer a similar fate to those working in meatpacking plants.
- Eater summarized the situation on West Coast fruit and vegetable farms, pointing out that migrant farmworkers’ biggest threat is tight living conditions.
- Writing about the situation at meatpacking plants, Agri-Pulse described what large facilities like Tyson have done to implement safety measures. Meanwhile, the Environmental Working Group urged the USDA to provide more protections.
- On May 12, CBS News reported on two families suing meatpackers for “ignoring safety guidelines” from the CDC after workers died from COVID-19. A judge dismissed a similar lawsuit on May 6 (Reuters).
- Triple Pundit’s Mary Mazzoni outlined what some workers are doing on their own to protect themselves, including Walmart employee Cynthia Murray, who is pushing to allow hourly workers to sit on the board of directors. Murray reasoned, “None of the independent directors report having retail experience. Our voice is needed.”
Retail Ripple Effects
Rising food prices are worrying consumers who increasingly rely on supermarkets for food in the midst of the pandemic. At the same time, influential voices are looking at what lasting changes the pandemic will have on food preferences and changes to the supply chain.
- The Washington Post captured consumer concern about a Department of Labor report that found grocery prices “showed their biggest monthly increase in nearly 50 years last month, led by rising prices for meat and eggs.”
- In contrast, the Food and Agriculture Organization of the United Nations (FAO) reported a decline in world food prices for the third straight month.
- Online grocery sales are projected to grow 40% in 2020, according to survey results shared by Supermarket News.
- Reporting on Nielsen’s COVID insights, Winsight Grocery Business hinted at changes in consumer food trends to come, including a “‘buying milk from cows we can see’ mentality.”
- A Bloomberg business columnist suggested the surge in sales of familiar food brands is not “a new normal …If anything, it’s a time to step it up.”
- Praising employees for going above and beyond during the pandemic, Walmart U.S. President and CEO John Furner announced additional bonuses. Combined with those announced in March, this brings the total bonus pool to nearly $940 million.
Some important points of view worth checking out this weekend.
Engineering New Crop Rules
On May 14, Ag Secretary Sonny Perdue made a polarizing announcement concerning genetically engineered (GE) crops, which will rekindle the dormant GMO debate. The “SECURE rule” simplifies the GE crop approval process “by removing duplicative and antiquated processes in order to facilitate the development and availability of these technologies.” The Center for Food Safety immediately condemned the rule for “[abdicating] government responsibility,” while Farm Bureau President Zippy Duvall supported the “common-sense approach to encouraging innovation.”
A Sick System
Omnivore’s Dilemma author-turned-therapeutic-LSD-evangelist Michael Pollan took to the New York Review of Books to offer an extreme position on the state of the food supply chain: “A series of shocks has exposed weak links in our food chain that threaten to leave grocery shelves as patchy and unpredictable as those in the former Soviet bloc.”
The Bigger They Are the Harder They Fall
In a May 3 Forbes article, livestock whisperer Temple Grandin gave her perspective on the meat processing situation. Weighing the pluses and minuses of a centralized, consolidated system, Grandin acknowledged the efficiency and fragility of today’s production versus the lower risk — but higher cost — of localized production.
Is a Tesla Tractor Next?
GreenBiz contributor Shane Downing collected several examples of potential future trends in farming: electric vehicles, robots and tractors. The author cited motivating factors of looming labor shortages (especially with the COVID-19 backdrop), the need for precision farming, and advancements in automation.
Grist writer Zoya Teirstein examined a New York University study of why some who are genetically predisposed to celiac disease develop the autoimmune disease while others do not. Among the findings: “Young females exposed to higher-than-normal levels of non-stick chemicals like PFAs were five to 9 times more likely to have the disease than children exposed to lower concentrations of those chemicals.” Chalk up one more win for cast iron.
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