Foodservice Prices Drop Below 10% – A Welcome Breather for the Industry
A recent headline that brings a sigh of relief: the CGA Prestige Foodservice Price Index (FPI) slipped under the 10‑percent mark in March for the first time in two years. The move was nothing short of a “greatest month‑on‑month drop ever” – a 1.4% plunge that feels like a reset button pressed in a market that’s been on high‑speed incline.
What the Numbers Are Saying
- Foodservice inflation: 0.1% jump in March, down from the double‑digit pace that have plagued the sector.
- Retail counterpart: 4.0% year‑on‑year – more than twice the FPI’s rise.
- Only one FPI category fell year‑on‑year, yet every category showed a month‑on‑month reduction – a sign of wider market shift.
Wage costs are also easing: real‑term growth hit just 2.9% in February, loosening the inflationary pressure cooker that has kept prices high.
Looking Ahead – Do We Stay Warm?
With the National Living Wage set to bump up in April, growth might initially take a hit. However, the Knights of the Budget (aka the Office for Budget Responsibility) reckon the general CPI will hover around the 2% target by Q4 2024. That’s a tidy target, but the path is still dotted with potential hurdles.
Supply Chain Side‑Track
Border checks coming in the UK may add extra cost layers. Think of it as a surprise pop‑up shop in the price tag: “A quick checkout that doubles as a pain point.”
Expert Voice – Voices from the Inside
Shaun Allen, Prestige Purchasing CEO: “It’s great that inflation’s stepping back, but that’s also a perfect window for operators to audit their buying tactics. Now’s the time to lock in better deals and maintain that edge.”
James Ashurst, Client Director at CGA by NIQ: “After a relentless two‑year inflation spree, dipping into single digits feels like a fresh breeze. Still, true stability is a marathon, not a sprint.”
Bottom Line
Foodservice faces a relief from price spikes, but the fight for stable, low inflation is a long marathon. Managing wages, border logistics, and smart procurement are the trio of challenges every operator must tackle in 2024.
Keep your finger on the pulse – this break is a rare pulse beat in a high‑frequency market. Libraries, spreadsheets, and good grooming will pave the road to those soft-landed figures.
