1851

On Thursday, Bloomberg published a story by agricultural reporter <a href="https://www.linkedin.com/in/megan-durisin-5717a81b?utm_source=1851franchise.com&utm_medium=article&utm_campaign=declining-food-prices-may-soon-bring-relief-to-food-service-franchises-2716365" target="_blank" rel="nofollow">Megan Durisin</a> on<a href="https://www.bloomberg.com/news/videos/2021-08-05/global-food-prices-fall-in-sign-of-relief-for-consumers-video?utm_source=1851franchise.com&utm_medium=article&utm_campaign=declining-food-prices-may-soon-bring-relief-to-food-service-franchises-2716365" target="_blank" rel="nofollow"> the global food price index,</a> which has gradually declined since it skyrocketed earlier this year. While the index is still high, the downward trend suggests financial help is on the way for food service businesses.The food cost index, released by the UN’s Food and Agriculture Organization, measures the monthly changes in the cost of cereals, oilseeds, dairy, meat and sugar. In early summer, the<a href="http://www.fao.org/news/story/en/item/1403339/icode/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=declining-food-prices-may-soon-bring-relief-to-food-service-franchises-2716365" target="_blank" rel="nofollow"> FAO detailed</a> how food prices in May were “4.8 percent higher than in April and 39.7 percent higher than in May 2020.” That downward trend is expected to continue as the northern hemisphere approaches a full harvesting season this fall.Earlier this year, the spike in worldwide food costs presented challenges for restaurants, restaurant suppliers and grocery chains alike. The declining index will give those businesses the chance to revert back to some operations that were once standard, and that could do wonders for franchises that have struggled to adapt to a pandemic.The supply chain crisis may offset some of that help for consumers and franchises, however. For products like rice, the world is seeing a “trade slowdown, partially due to the spike in freight and shipping costs around the world,” Durisin said.&nbsp;Some companies may be less willing to purchase food with expensive shipping, so the current prices of global trade have forced many food suppliers to sit on an abundant supply and lower their food prices as a hopeful purchasing incentive. Lower food costs will at least help mitigate some of the additional shipping expenses.Locally sourced foods could have extreme benefits for franchises to navigate a challenging supply chain, as local shipping expenses are far lower.But a local supply chain may not be feasible for many brands. National food service franchises strive for consistency across each unit, and sourcing local foods may create inconsistencies.Declining food prices will of course benefit consumers as well. Shipping issues aside, the trend suggests the global food trade may be recovering from pandemic-related shutdowns. Food service franchisees could see a big spike in productivity once lower food prices are matched with an efficient supply service.

Declining Food Prices May Soon Bring Relief to Food Service Franchises

1851 Franchise

Restaurant brands struggling with expensive supply chains may soon benefit from a steadily declining global food price index.

declining-food-prices-may-soon-bring-relief-to-food-service-franchises

Melting Pot

Photo of interior of Melting Pot restaurant

Lexington Herald Leader: This Restaurant Chain Eyes a Return to Lexington After 10 Years

melting-pot-return-to-lexington

Keke's Breakfast Cafe

Keke's Breakfast Cafe - John and Kimberly Ehrhard - 1851 Franchise

Empowering Leadership, One Pancake at a Time: How John and Kimberly Ehrhard Are Building a Franchise Legacy with Keke’s Breakfast Cafe

john-kimberly-ehrhard-kekes-franchise

Comfort Keepers

More Than a Caregiver: Loretta Smith's Support Extends to Fellow Caregivers, Clients and the Community

more-than-a-caregiver-loretta-smiths-support-extends-to-fellow-caregivers-clients-and-the-community

Photo of Melting Pot CEO John "JC" Crawford

Melting Pot Names New CEO, Celebrates 50th Anniversary With Continued Growth and Leadership Promotions

melting-pot-franchise-mid-year-2025

Layne's Chicken Fingers

Texas Layne’s Franchisee Secures Real Estate in Austin, Set To Open Early Next Year

texas-laynes-franchisee-secures-real-estate-in-austin-set-to-open-early-next-year

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Development Website Builder

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

Drone Delivery Takes Flight in QSR: The Future of Franchise Operations?

drone-delivery-takes-flight-in-qsr-the-future-of-franchise-operations

Chick-fil-A Tops Customer Satisfaction Rankings for 11th Year as Challenger Brands Gain Ground

chick-fil-a-tops-customer-satisfaction-rankings-for-11th-year-as-challenger-brands-gain-ground

Technomic Releases Annual Ranking of the Top 15 Fast-Food Chains in the U.S.

technomic-releases-annual-ranking-of-the-top-15-fast-food-chains-in-the-us

Rising Jobless Claims Could Signal Challenges — and Opportunities — for Franchising

rising-jobless-claims-affect-franchising

Hardee’s Lawsuit Highlights the Risk of Going Off-Model in Franchising

hardees-franchise-lawsuit-paradigm-investment-group

Hooters Leans Into Franchising With Closure of 30 Company-Owned Stores - Agg - 1851 Franchise

Hooters Leans Into Franchising With Closure of 30 Company-Owned Stores

hooters-franchise-model-company-owned-closures

The Ultimate Guide to Selling Franchises: How To Create a Strong Incentive

how-to-build-strong-incentives-to-attract-prospective-franchisees

How Vishal Juneja Turned a Family Tradition Into a Paris Baguette Franchise

How Vishal Juneja Turned a Family Tradition Into a Paris Baguette Franchise Built on Heart and Community

Declining Food Prices May Soon Bring Relief to Food Service Franchises

MORE STORIES LIKE THIS