Higher prices, fewer drivers: Food banks exacerbated by the supply-chain crisis

One nonprofit said a $0.32 increase in the price of chicken drumsticks works out to an increase of about $100,000 a month in costs.
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· 3 min read

Higher prices. Fewer workers. Increased demand. These are supply-chain issues affecting companies of all sizes. But for nonprofits like food banks, the crisis is magnified as they struggle to keep up with soaring costs for basic goods like eggs, meat, and vegetable oil—and amid soaring needs.

Do the math: “Chicken drumsticks cost $0.32 more per pound than a year ago,” Barbara Abbott, VP of supply chain at the San Francisco-Marin Food Bank, told Retail Brew. “And we buy 40,000 pounds per load, as product is available.”

  • She said that the food bank usually needs two full truckloads of protein a week, and, at close to $13,000 more per load (on average), that works out to an increase of about $100,000 per month. (The nonprofit said donations have managed to cover the costs.)

“[Covid] continues to be in control of this economy and supply chains, so it is hard to say when things will improve,” Abbott said.

Given some food banks' shift from relying on canned goods to fresh produce, another issue is that deliveries haven’t always been in the best condition lately. Delays have left inventory stranded in ports. “By the time some of those items reach us in the emergency food space...they are in far worse condition than we normally receive them,” said Jordan Tarwater, executive director of the Urban Outreach Center based in New York.

Needing a lift

Blame a dearth of drivers, which every food bank we spoke to said they are facing.

While industries across the board have been hit by labor shortages, Anna McGovern, chief supply chain officer at Food Bank For New York City, said food banks are losing drivers to the e-comm boom.

“We were already facing a shortage of over-the-road drivers before the pandemic,” she told us. “The situation became more dire as demand for local drivers skyrocketed due to e-commerce, and many drivers were able to quickly land jobs driving locally.”

  • Consider that even FedEx is rerouting 600,000+ business packages daily due to a lack of staff.
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Keeping afloat: Back on the West Coast, at San Francisco-Marin Food Bank, transportation costs have more than doubled compared to what they were two years ago, Abbott said, mostly due to increased warehouse capacity during the pandemic and a 40% increase in food distribution. “That has meant more transfers between our facilities and wear and tear on our equipment,” she added.

The California Association of Food Banks said it continues to seek volunteers to meet the uptick in demand and “get food sorted, packed,” and delivered to those who need it.

“While we were fortunate to keep hunger levels relatively steady during the pandemic to date, that’s not because there wasn’t great need,” Lauren Lathan Reid, director of communications at the nonprofit, said.

Food banks told us they’ve survived on donations from local communities and government aid throughout the pandemic. McGovern, of the Food Bank For New York City, pointed to programs like the CARES Act or the American Rescue Plan Act, which enabled more product availability.

  • The Urban Outreach Center also received help from food partners, including wholesale suppliers, to ensure a steady stock of goods.

Looking ahead: The food banks we spoke to are hopeful that hiring will pick up over the coming months—with school open once again, and Covid-related unemployment benefits having run out—but history has taught them that “demand never gets back to pre-crisis levels,” Reid said. “We see this as an ongoing challenge not for months, but years.”

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