Food prices continue to rise; Sector in "crisis mode"

The price for a beer on the terrace or a sandwich at the station will increase by 3 to 5 percent this year. Many food service companies, including catering and supermarkets, expect this in an inventory by the FoodService Institute Netherlands (FSIN). Every two years, FSIN assesses the situation of the 500 largest food companies in the Netherlands, such as Albert Heijn and Thuisbezorgd. According to the institute, entrepreneurs are in “crisis mode.”

FSIN sees an industry struggling with its revenue model despite a joint turnover increase of over 20 percent to more than 61 billion euros last year. There are significant concerns about shrinking margins, staff shortages, and scale problems.

Last year’s significant increase in turnover is mainly due to inflation and the recovery from the coronavirus crisis, said FSIN. Supermarkets like Jumbo and Lidl are seeing their turnover increase, but the actual number of products sold is decreasing.

Price increases are not the only measures companies in the food sector can take to maintain turnover. Companies have also mentioned limiting food waste, increasing scale, and accepting a lower profit margin in the FSIN inventory.

Despite the concerns, sales growth of almost 15 percent is expected this year. FSIN director Inga Blokker speaks of a “stark contrast between the turnover increases and the opinions of entrepreneurs.”