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Supply Shortage of Tomato Condiment Confirmed by Kraft Heinz

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Supply Shortage of Tomato Condiment Confirmed by Kraft Heinz

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Tomato condiment is widely used globally and is considered among the most favored condiments. It possesses a blend of sweetness and savoriness, making it a versatile accompaniment to many dishes. It is commonly available in various forms, either in bottles or individual packets, at most dining establishments, with the exception of some Chinese eateries (even this varies across states). The surge in the demand for tomato condiment over the past year can be primarily attributed to the COVID-19 pandemic, owing to the increased preference for takeout meals. This resulted in a remarkable 300% spike in the sales of tomato condiment products since March 2020. Similar to the trends witnessed with toilet paper, hand sanitizers, and computer chips, the pandemic led to a scenario where the demand for tomato condiment exceeded the existing supply.

Kraft Heinz, the primary supplier of tomato condiment products globally, has officially acknowledged the shortage of tomato condiment. Noteworthy restaurant chains have attested to this fact; for instance, Long John Silver’s seafood chain mentioned to The Wall Street Journal that they had to allocate over $500,000 solely for purchasing tomato condiment packets in the last year to meet the escalating demand for takeout orders. Another example is the Texas Roadhouse steakhouse chain, which consumed over 55 million ounces of tomato condiment in total during the previous year and had to resort to switching to lower-cost, generic alternatives.

Anticipating the surge in the demand for tomato condiment, Kraft Heinz had initiated proactive measures at the onset of the pandemic. Steve Cornell, the president of Enhancers, Specialty and Away from Home Business Unit, stated to USA Today that they had “strategically invested in manufacturing facilities when the pandemic began to cope with the escalating demand for tomato condiment packets, driven by the accelerated trends in food delivery and takeout services.”

Despite these efforts, the demand for tomato condiment continues to rise, especially with the increasing production costs of individual packets resulting in a 13% surge in wholesale prices to restaurants. In response, Kraft Heinz is implementing strategies to enhance production, such as establishing new packet manufacturing lines, with a goal to elevate packet output by a minimum of 25% by year-end.

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