The Economic Backdrop
As we pause this Labor Day, the broader economic picture is hard to ignore. Rising home prices, higher mortgage rates, and day-to-day inflation have shifted how consumers approach spending. Behavioral economists like Kahneman, Tversky, and Thaler remind us that people don’t always behave in neat, rational ways. Instead, they practice “mental accounting”—shifting dollars across categories, cutting back in some areas while allowing for small indulgences in others.
What It Means for Foodservice
That’s exactly what we’re seeing in foodservice. Operators face margin pressure from labor shortages, supply costs, and uneven traffic, but consumers aren’t abandoning restaurants altogether. They’re re-allocating: trading down, splitting meals, or choosing formats that feel like better value. At the same time, convenience is king—c-stores, delivery, and digital ordering continue to capture share by fitting seamlessly into people’s routines.
Opportunity for Manufacturers
For manufacturers, this means opportunity is less about chasing “growth at all costs” and more about helping operators connect the dots: how to define value in context, how to balance premium and affordable offerings, and how to communicate why an item earns its price point. Success in this environment isn’t about volume alone—it’s about relevance, adaptability, and understanding the consumer’s shifting frame of reference.
Labor Day’s Reminder
Labor Day is a reminder that the foodservice industry itself is labor-intensive and people-driven. The employees running kitchens, stocking shelves, and serving meals are at the heart of the recovery—and they too are managing higher costs of living and difficult trade-offs. As an industry, we can’t separate economics from people.
FSIP’s Role
At FSIP, our role is to bring evidence-based insights to manufacturers navigating these realities. This fall, we’ll continue to explore how shifting economics, consumer psychology, and operator needs intersect—and what that means for sustainable growth in foodservice.
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