A Primer on Foodservice Packaging: Packaging Should be a Part of Menu Development

Jun 17, 2022

Today, nearly half of operators consider how a new takeout item will be packaged prior to launching a new product.

What is newsworthy about this finding today versus a decade ago is that we didn’t have Covid-19 in our sights and few saw the supply shortages we are still experiencing.  Operators have historically high costs and struggle (even in the best of times) to keep up with labor, food, real estate, franchisee and government-related costs. So to now see that packaging remains a key ingredient in the product development process is a major milestone.

With a recession potentially in the works based on weak economic data, the foodservice industry must always pivot ahead of a downturn. Foodservice is one of the leading indicators of a recession. Economists will often cite the decline in away-from-home traffic and sales as the precursor to a recession.

Before we get to operator cost-cutting measures, however, it’s important to caveat the discussion with the fact that today, quality packaging is the most important attribute to both consumers and operators. In fact product quality and availability of the “right” packaging surpass price. Other factors are shown in the table.

The Top Five Selection Criteria for Foodservice Packaging

Attribute (in order of importance) Comments
Product Quality
  • This is the most important attribute.
  • It encompasses function, appearance and durability, though we do ask those separately.
Product Availability
  • This has increased in importance during the supply-chain shortage. Operators have had to juggle between menu applications to ensure they have the proper packaging in place.
Price
  • Trying to balance price and quality (and supply shortages) has been tricky right now.
Functionality
  • This fits into the quality realm – lids must fit cups, clam shells must close – the solution must do what it’s been sold to do.
Eco-Friendly
  • This encompasses everything from compostable and recyclable packaging to reducing the waste associated with “too much” packaging, as consumers say. 
  • However, the complaint from operators has been that they sacrifice function and durability for eco-friendly material.

Source: Foodservice IP Operator Interviews

 

Foodservice operators, fresh off the heels of a Covid-19 recession, are well aware of the dangers and therefore “freebies” like packaging, napkins, water cups, etc. are the areas too, where operators look to cut some costs. Some of the major cost-cutting responses are using less expensive material (foam v. paper), switching to private label or using other distributor sources.

Operators Still Look to Cut Packaging Costs, Where it Makes Sense

Cost-Cutting Measure Comments
Using Less Expensive Material
  • Seems to be the most common response for cups, cutlery and napkins.
  • Shortages exist so it’s challenging for operators right now to have the buyer’s edge.
Switched to Private Label
  • We wrote earlier this year about the huge leap in distributor and private label brands. Non-food distributors have made serious inroads during Covid-19.
Reduced Packaging Waste
  • This was experienced most in cutlery. Georgia Pacific and SCA have come out with single-dispensed cutlery in the past.
Distributor Shopping
  • Looking to wholesalers, paper distributors and others that can meet pricing demands and availability outside of major broadliners has been a strategy.

Source: Foodservice IP Operator Interviews

Foodservice Packaging Quality Will Remain Elevated

We hope this primer on takeout packaging helps give the food and packaging executive the insights needed to continue to push the critical message of high-quality packaging to operators. 

 

Foodservice IP is launching a new study on takeout packaging. Click here for more details.

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