WASHINGTON - Today, the House Committee on Small Business heard from small business owners and other witnesses on the impact of COVID-19 on the nation’s food system.
“America’s food system has been hit particularly hard: our favorite restaurants were closed; meat sections were low at grocery stores; and many essentials were sold out. …Our nation’s food system is typically geared to meet commercial demand, from restaurants, buffets, and cafeterias, more than retail demand from grocery stores. When our food demand flipped from eating out to cooking at home, businesses along the supply chain had to pivot to survive,” said Ranking Member Steve Chabot (R-OH).“At this Committee we understand the power of our nation’s innovative spirit. Now the rest of the country can see it firsthand. Investments being made by small businesses across the supply chain are creating a more resilient food system for all of us.”
Pivots Include Direct-to-Consumer Models, Home Delivery
“In addition to the people employed directly at Seventh Son, our brewery helps to support countless jobs throughout Ohio from the people our wholesalers employ to help sell our beer to the farmers that grow our hops and barley. A smooth supply chain is imperative to the success of our brewery and is equally beneficial to our partners. I have always been proud of the fact that for every new job created by our brewing industry, there are twenty-four jobs generated in the industries that help us brew and sell our beer,” said Mr. Collin Castore, Owner, Seventh Son Brewing, President, Ohio Craft Brewers Association (OCBA), in Columbus, OH. “At Seventh Son we have our own canning line and some existing relationships with grocery chains that helped us to absorb most of this on-premise volume loss. On March 16, we began a home delivery business and carryout sales model out of our shuttered taprooms. These measures were a lifeline but our head is barely above water.”
“With capacity limits in place at many restaurants and the closure of many other public eating venues, seafood companies all across the supply chain are at serious risk of failing. Many struggling companies rushed to freeze and store product, some even began selling directly to consumers. Even with that effort, millions of dollars’ worth of fresh product that could not be sold or stored had to be destroyed,” said Ms. Kimberly Gorton, President and CEO, Slade Gorton & Co, Inc. in Boston, MA.Ms. Gorton testified on behalf of the National Fisheries Institute. “Even with partial reopenings, restaurant operators are faced with increased costs at a time when many are operating at below break-even capacity… It is only through ingenuity, resilience, grit, and determination that companies like Slade Gorton have been able to survive thus far… Now that food service establishments are open, they will need to rely on their suppliers to continue to provide credit so they can restock their kitchen. We are now faced with choosing to extend further credit at some risk or abandoning what are in many cases decades-long customer relationships.”
“Independent grocers like me are deeply rooted in the communities we serve. Since mid-March, independent grocers have experienced sustained and historic levels of demand for grocery and household products. We have had to adapt to large volumes of customers stocking up weeks worth of foods, straining the supply of key product categories like paper, cleaning supplies, and shelf-stable products,” said Mr. Jimmy Wright, President, Wright’s Market, in Opelika, AL. Mr. Wright testified on behalf of the National Grocers Association.
