What the Impossible Burger Shortage Can Teach Restaurants About Inventory Management

By: Brian Shultz

7 Minute Read

Jun 17, 2019

IMPOSSIBLE BURGER SHORTAGE

It can come without warning.

But, in this case, it came with a clear warning.

Restaurants across the nation were recently shell-shocked when Impossible Foods, makers of the plant-based Impossible Burger, experienced product shortages. They informed distributors and restaurants that they would be unable to fulfill all pending orders for the time being. For many restaurants, the Impossible Burger serves as a plant-based meat alternative menu item. It can help to accommodate vegan, vegetarian, and flexitarian diners. Interestingly enough, though, meat-eaters represent the largest group of patrons ordering plant-based meat alternatives. 

At the 2019 National Restaurant Association Show, the 'plant-based boom' was the talk of the town. Between summer 2017 and summer 2018, sales in the plant-based alternative category – including both plant-based meat alternatives and plant-based milk alternatives – were up 9% year over year. 

Read More: Check Out Toast's Live Coverage of The 2019 National Restaurant Association Show

The demand for plant-based meat substitutes that mimic the real thing in terms of taste and texture has grown exponentially in recent years. This has come in light of increasing societal and political concerns over animal welfare, the meat and dairy industries’ detrimental effects on the environment, an increased demand for heart-healthy menu items, and food surplus management.

Impossible Foods has benefited from the plant-based boom via large-scale deals with quick-service chains and franchises like White Castle, Qdoba, and, most recently, Burger King, who will be rolling out a white-labeled Whopper version of the Impossible Burger nationwide in the coming months. 

Obviously, these large-scale deals are great for Impossible Foods, as well as competitors like Beyond Meat (which launched a successful IPO in early May). However, without the proper systems in place to scale and successfully meet this overwhelming demand from their B2B channel, the many smaller, independent restaurants who rely on the Impossible Burger as a customer draw are left to suffer the consequences. Back in April, Impossible Foods sent a memo to its distributors that product shortages were imminent, with the company currently expanding labor force hours and a second production line to meet demand and rectify the situation. 

So what can restaurants do when faced with the sudden challenge of managing a product they may not be able to restock anytime soon?

Read More: Meatless Monday Ideas for Restaurants: 5 Reasons Why It's a Cash Cow

1. Talk to Your Distributors Regularly

The Impossible Burger shortage highlights the importance of establishing a strong, communicative relationship with your restaurant’s food distributor. In this particular case, Impossible Foods did tell its distributors that a shortage was imminent, though it's unclear whether these distributors properly communicated this message to their restaurant clients at all. If they did, it's unclear whether they gave their restaurants enough of a heads up to prepare a backup plan. It's worth noting that Impossible Foods also directly informed some of the restaurants that carry their burger about the impending shortage.

Maintaining a great rapport and frequent communication with the actual makers of your specialized food ingredients, though time consuming, can be hugely beneficial. 

2. Buy in Bulk

Restaurateurs who knew of the imminent shortage beat their neighbors to the punch and ordered extra product right away. New York City vegan French café Delice & Sarrasin placed an order for three cases and were promptly informed by their distributor that they only had two cases left for all of New York City. Tim Sykes of Ruby’s Café, also located in New York City, contacted an alternate distributor and ordered the last eleven cases they had in stock. 

As previously mentioned, sales in all plant-based categories were up 9% between summer 2017 and 2018, and the market is expected to continue to grow exponentially in the next few years. If plant-based meat alternatives are one of the stars on your menu, consider buying in bulk from your distributor so you don't run out. While you're at it, it's worth shopping around to see what smaller players in the booming plant-based meat alternative space have to offer. Given that Impossible Foods and Beyond Meat have their sights set on the franchise and quick-service chain market, there may be competitors who specialize in the independent restaurant space and can provide you with a better inventory purchasing experience.

Read More: How to Set Up A Par Inventory Sheet

3. Be Creative 

This might be an opportunity for restaurants to explore new menu options and items. Plant-based proteins aren't just attractive to vegetarian or flexitarian diners; omnivores are actually the largest buying group, as well as Millennial and Gen Z diners who are interested in trying the goods.

If you come to find that a particular food ingredient or product won’t be available to reorder for some time (we're not just talking plant-based meat alternatives), it may be wise to suspend the usual menu item that bears it and swap in a seasonal replacement or limited-time offer (LTO) to stretch it out. For example, instead of serving a full plant-based meat alternative patty, half a patty could serve as the base for a plant-based pasta Bolognese or a taco salad. Aroogas Grill House & Sports Bar has incorporated ground plant-based patties into two limited time offers: nachos and chili.

4. Consider an Alternative 

A restaurant in need can always consider a substitute ingredient or product; that being said, it may not go according to plan.

The aforementioned Ruby’s Café replaced the Impossible Burger with a similar version from its competitor Beyond Meat, only to have a number of customers turn around and leave after being informed of the switch. Of course, it’s still better to try and offer a comparable menu item than do nothing at all, in hopes of retaining some of that customer base expecting to dine on it that visit. It all depends on the particular tastes and loyalties of your usual guests.

5. Master Your Inventory

This is also an opportunity to stress the importance of looking over your food inventory across the board. Make sure there’s someone on staff specifically tasked with overseeing and fortifying all food and ingredient quantities, as well as handling any challenges when it comes to low quantities or known and impending shortages. A restaurant with the business volume to warrant it might even benefit from a full-time inventory manager, someone with experience navigating such situations.

Learn More: The Inventory Software Powering Successful Restaurants

6. Use The Inventory Shortage As a Marketing Opportunity

When a guest arrives expecting this particular menu option only to be let down, a staff member can engage their future business by promising to let them know when the product will be back in stock. This can be done a few ways:

  • Mentioning it in a pre-existing email blast or recurring newsletter that the restaurant sends out to a list of subscribers; it’s a valid excuse to add an interested customer to the subscriber list

  • A “Grand return of the _____!” post on all social media outlets

  • A specific list of customers to contact personally via phone or email when the product is back in stock

Read More: How to Turn Your Menu into a Marketing Tool

Prepare for The Impossible

Impossible Foods provides a veritable case study for how restaurants can handle inventory shortages. They developed a product and tested it heavily in restaurants, watched it explode in popularity, and then struggled to keep up with demand when they cashed in on it with big distribution deals. They’ll certainly catch up soon, but it’s left smaller restaurants scrambling to figure out how to manage a situation that, for some, draws in a largely specific crowd. Fortunately, there are a number of smart ways to cope and even possibly benefit from the situation, as illustrated above.

Impossible Foods has not yet promised a date for when normal supply would resume. However, some restaurants seem to be taking the current shortage in stride. Christhina Verna, manager at Brooklyn vegan cheese shop and café Riverdel, told Eater calmly, “We’ll survive.” Nonetheless, by applying these strategies and tactics, all restaurants should be well-equipped to weather the next storm when it’s forecasted.

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