The Case of the Missing Airport Snacks
This blog was written by Bryant Miller, Corporate Communications, with insights from Shri Hariharan, VP of Industry Strategy at Blue Yonder
I have a confession: I am a snacker. There isn’t a snack I’ve met that I didn’t like. And my peak snackiness is when I’m traveling and visit the airport convenience stores to see all the weird and wonderful treats… grain-free peanut butter-filled pretzels? Yes, please. Grass-fed Wagyu beef jerky? Sign me up.
But if you’re like me and haven’t traveled for a while because of the COVID-19 pandemic, I have some potentially devastating news: the airport snacks are gone.
I’ve taken several trips just recently — through major hubs and even small regional airports — and the snacking situation isn’t good. Many of the shelves and bins are empty, with nary a paleo protein bar in sight.
Luckily, I work for the world leader in digital supply chain, with access to hundreds of data scientists, engineers and industry experts, all just one Microsoft Teams chat away from answering my burning questions. For this situation, I knew exactly the right person to ping — Shri Hariharan, VP of Industry Strategies and our resident CPG (consumer packaged goods) guru.
And Shri was chock-full of wisdom about where my beloved airports snacks have gone. He told me that supply hasn’t caught up with demand and there aren’t enough workers across the supply chain.
Supply Hasn’t caught Up with Demand
The common thread story throughout the pandemic is that sometimes there isn’t a true shortage of products, but rather it’s that these products aren’t packaged for the right demand. When everyone first went into quarantine, companies had to pivot to get toilet paper ready for more at-home use instead of offices, retailers and restaurants. Then we all started ordering take-out and our local burger spots couldn’t find ketchup packets because the manufacturers had shifted to filling more bottles for grocery shelves.
The same thing happened with airport convenience stores. When nobody was flying, there simply wasn’t demand for the snacks, so those products were repurposed and sent elsewhere. And when travel started to pick up over the summer, manufacturers couldn’t pivot quickly enough. Now that the COVID-19 variants are increasing and travel restrictions are being implemented again, predicting the volume of consumer-packaged goods has become even more difficult.
Not Enough Workers Across the Supply Chain
Every single facet of the supply chain is experiencing labor shortages. The lack of factory workers is the first hiccup, and then the snacks need to get from factories to distribution centers — and we’ve all heard about the scarcity of truck drivers. After that, warehouse workers load the products onto local-delivery trucks, where the number of jobs far exceeds the applicants. Finally, retailers can’t hire enough staff to sell those dark chocolate-covered dehydrated banana pieces and organic chili-lime pork rinds.
Today, 54% of manufacturers say they’re having trouble finding candidates, compared to 38% before the pandemic. In the short term, these employers are focused on keeping current talent by creating employee-centric work environments, like offering flexible schedules. The long-term strategy must change the industry perception to appeal to millennials and Gen Z.
The Future of Airport Snacks
In addition to shifting available supply and the worker shortage, the CPG industry grew 8.7% year-over-year, which is almost as much as the prior four years. With rising costs and labor shortages tightening margins, what does the future of my precious airport snacks — and much of CPG — look like?
When it comes to meeting demand, we expect to see an even bigger adoption rate of using AI/ML to predict trends and shortages and to pivot the supply faster to where it’s needed. Automating planning decisions and using algorithms to incorporate dynamic features, like the current manufacturing environment, is a much smarter and more resilient plan than relying solely on spreadsheets and historic data.
As for the airports specifically, we’re already getting a glimpse into the future: automation. We’re seeing human-less kiosks, vending machines filled with fresh food, and automatic dispensing machines popping up everywhere. So, considering the current labor shortages, your next early-morning-flight latte could very well be crafted by a machine, not a barista at the coffee shop.
To learn more about the future of CPG and the digital supply chain, visit our thought leadership hub: https://blueyonder.com/thought-leadership