Turkeypocalypse? Supply chain issues threaten Thanksgiving main course


Homestyle Foods from Ukrop unable to fill turkey orders this year

Posted

October 14, 2021




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Robyn sidersky


The Shenandoah Valley is home to much of Virginia’s poultry industry.

Get a turkey on your Thanksgiving table this year, you may need to plan ahead. And even so, ham, the pork tenderloin, chicken, or even the tofurkey may need to be replaced.

Homestyle Foods from Ukrop, the Richmond-based prepared food company that spun off from the former regional grocery chain, informed customers on Tuesday that it would not be able to fill orders for precooked turkey for Thanksgiving. This year.

The company placed an order for 2,000 turkeys with Butterball and received a notice that the order had been canceled due to an operational situation, Robert S. “Bobby” Ukrop, chief executive officer, told Virginia Business. of Ukrop’s Homestyle Foods LLC.

The supply chain problems that began during the COVID-19 pandemic have been exacerbated by several factors, including a domestic labor shortage and slowdowns in shipments, and are expected to continue to have an impact on businesses throughout the holidays, according to economists and logistics experts. Last month, the consumer price index rose 5.4% from September 2020, in part due to shortages in consumer goods.

The supply chain issue prompted President Joe Biden to act, who announced on Wednesday that the Port of Los Angeles would begin operating around the clock in a bid to close a backlog caused by various factors, including the shortage of labor in trucking. Biden also said major shipping companies and retailers, including UPS, FedEx and Walmart, would increase working hours to meet problems in ports, factories and shipping lanes that have helped produce shortages, long delivery times and rapid increases in the prices of food, televisions, automobiles and more, reported The New York Times .

Bobby Ukrop, CEO of Ukrop Homestyle Foods

In an October 12 Facebook post and marketing email, Ukrop’s Homemade food wrote that his supplier cited “the same concerns almost everyone knows about: ingredients, packaging, transportation and labor shortages.” IInstead, the company invites its customers to order hams and sides.

Ukrop says the company ordered more ham this year: “The pandemic has made us expect the unexpected, and surprise is part of the program. “

Ukrop’s started offering holiday dinner packages in the early 1990s, Ukrop said, and it has grown.

Last year, the pandemic really turned things upside down, creating significant demand for pre-prepared Thanksgiving meals. Ukrop filled 2,400 meal orders over four days.

“It was like a drive-thru from Chick-fil-A on steroids,” Ukrop recalls.

Last year, with a full and expansive catering menu, customers ordered over 10,000 items, Ukrop said, but this year the company only wanted to put on the menu the things they were confident they could. get.

Due to ingredient and packaging supply issues, Ukrop has made the decision to cut its offerings this holiday season, reducing its usual holiday dining menu to 34 items. For example, the London Broil, a dish typically offered by the company’s catering service, won’t be available this year. Chicken salad and tuna salad are also off the list. Customer favorites such as devil’s eggs, ham cookies, and country ham cheese balls remain, however.

“It’s very frustrating for us because we hate to disappoint people,” Ukrop said. “We attach great importance to not promising too much. We want to deliver on what we say. This is how we have always done business.

Despite the supply chain struggles Ukrop faces, Hobey Bauhan, president of the Virginia Poultry Federation, said consumers shouldn’t panic about whether they can get a turkey this year. “It’s not a widespread shortage,” Bauhan said Tuesday. “Supplies are tight, but if people plan ahead, they should be able to source whatever turkey products they want for Thanksgiving.

Nonetheless, with supply chain issues looming, Commonwealth markets are bracing for the possibility of shortages of holiday staples and building up stocks ahead of Thanksgiving and Christmas. A small grocer and butcher contacted for this story declined to comment on the matter, fearing they could scare customers into buying from their stores.

Ukrop said his company plans to sell more hams this year because it cannot offer pre-cooked turkeys. Last year, the company sold around 400 a la carte hams. Obtaining hams seems less of a challenge, he said, and the company’s clean dining menu is still 80% of what people want on their tables this holiday season, Ukrop said.

Bauhan said that “[poultry] operations in Virginia supplying turkeys begin. They produce and distribute fresh turkeys for Thanksgiving. I am not receiving any indication from them that there is a significant shortage of turkeys.

But that doesn’t mean there aren’t issues affecting the distribution of turkeys to stores, Bauhan said. “There is upward pressure on many inputs in our sector, animal feed, which accounts for 70% of the cost of poultry production, [to] labor costs, transport and packaging [costs]. “Feed costs are rising and, like many other industries, poultry factories are also experiencing staff shortages.

Packaging is also one of the problems Ukrop faces. A shortage of lids and eight-ounce containers impacted the company’s menu.

Erika Marsillac, associate professor of maritime and supply chain management at Old Dominion University, said several factors impact the food supply chain. “A retail order may be canceled because suppliers anticipate that they won’t be able to deliver the order at the right time or find another customer willing to pay more,” Marsillac said. “Across all food supply chains, we are seeing food inflation and canceled shipments due to supply chain disruptions. “

Balance of power

In the poultry industry, “the workforce was tight before the pandemic hit and now it’s quite large,” said Bauhan.

Much of Virginia’s poultry industry is centered in the Shenandoah Valley, with other significant operations in the Richmond area and on the east coast. All face manpower issues, but it’s hard to say what a normal year would look like, Bauhan said.

“The past year has been unique,” ​​noted Marsillac. “With many families moving away socially during 2020, smaller birds have been preferred for holiday meals. Most retailers now believe family vacation reunions will be more important this year, but those estimates may have come too late to change decisions that were already happening in the spring. “

When it comes to business customers, small businesses like Ukrop can lose out to bigger ones like the Walmarts of the world.

“In general, smaller supply chain partners have less ‘power’ or influence in the supply chain,” Marsillac said. “Assuming there are a limited number of turkeys available, suppliers may be forced to make a compromise decision to cancel some orders for small retail chains so that they can fulfill orders for large chains. by retail.”

Much of the planning is done well before Thanksgiving. One market said it was placing its order for next year’s Thanksgiving a year later.

“The poultry industry has a significant turnaround time, predicting as early as late spring what size turkey will be needed for the holidays,” Marsillac said. “Farmers have to make decisions about the volume, sizing and breeding or acquisition of chicks. Once acquired or hatched, turkeys take over three months to reach the right size for processing, then you have to add the supply chain time from processing to getting the turkeys to the grocery store shelves.

Marsillac suggested consumers look for locally sourced options for turkeys and other party meats and plan ahead.

“Without trying to fuel a panic buy, I would suggest consumers buy their favorite holiday protein when they see it available and keep it until the holidays or speak now with their local butcher or farmer about the possibility. to get closer to the locally sourced holiday protein. for then. “

Ukrop said businesses around the world face tough decisions every day. And the situation is fluid.

“The various decisions businesses are making all over the world… everyone is trying to do the right thing. There are so many unanswered questions and so many decision points where things can go down the supply chain, and I think everyone is doing their best, the best they can, ”he said. he declares. “It’s just a crazy situation. …. The problem is, the elastic is stretched so thin, to the extreme, so the fact that our supply chain is probably very, very efficient in a normal situation, it can’t withstand all the disruption that we have. It’s a good learning [experience], I guess we have, to have a certain amount of safety stock and not have a system so tightly wound up that when things go wrong they really go wrong. “

Virginia Business Associate Editor Kate Andrews and Associate Editor Katherine Schulte contributed to this report.


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