Have grocers mismanaged Thanksgiving?
Over the summer, America heard how toy shortages might ruin Christmas. In recent weeks, the storyline has shifted to how turkey out-of-stocks could ruin Thanksgiving.
According to the U.S. Department of Agriculture, the nationwide inventory of frozen turkeys was 24 percent lower than the three-year average in August. Much like toys the turkey shortages are being largely attributed to supply chain disruption, particularly the reduced availability of trucks and drivers.
“I don’t like the word ‘shortage’ in this scenario. It’s not like we forgot to start raising turkeys,” Trey Malone, an agricultural economist at Michigan State University, told Vox. “What’s really happening is that you have these disruptions along the supply chain. It’s not because there’s no turkeys, it’s that the turkeys are in the wrong places at the wrong time.”
News reports of shortages and overall supply chain challenges have been driving early purchases of turkeys with some farms reporting early sell outs.
Stores need the right mix of sizes as well. The Wall Street Journal reports that grocers began sourcing turkeys as early as February to get ahead of the supply chain constraints. Many are believed to have stocked up on larger turkeys in anticipation of bigger gatherings, but due to the arrival of the delta, smaller birds will again be in demand.
Nearly two-thirds of Americans plan to spend Thanksgiving with just their immediate family, according to an October survey from Morning Consult. Last year, smaller birds wound up being in lean supply.
Finally, whole frozen turkey prices are up about 20 percent year-over-year, reaching an all-time high, according to the Department of Agriculture. The increase is traced to higher feed and fuel prices. With turkeys often used as a loss leader, supermarkets will either lose more margin or find turkey sales less of a traffic driver at inflated prices.
Customers are being advised to buy early to avoid shortages or higher prices on non-deal birds. Arthur Ackles, VP of merchandising and buying at Roche Bros., the Boston supermarket chain, last week told The Boston Globe, “Don’t panic, don’t hoard. But buy it soon.”
- Is there a Thanksgiving turkey shortage? It’s complicated – Boston Globe
- Is there a Thanksgiving turkey shortage? An investigation. – Vox
- Thanksgiving’s Price Tag Packs on the Pounds – Bloomberg
- ‘Plan early:’ National turkey shortage has not hit the Grand Forks region as hard, but customers should buy now – Grand Forks Herald
- Thanksgiving Turkey Shopping Has Already Started — for Supermarkets – The Wall Street Journal
- Thanksgiving Food Forecast: Supply Chain Setbacks, Smaller Gatherings and Embracing Tradition – Morning Consult
DISCUSSION QUESTIONS: Will shortages and higher prices for turkeys this year be more due to external challenges or internal missteps by grocers? What lessons does it offer for grocers trying to adapt to today’s supply chain challenges?