What is the immediate impact of the coronavirus on the foodservice equipment and supplies industry? Beyond the waning international demand for our products looms the impending supply chain interruptions.
We have seen component inventories shrivel up, in turn extending production lead times. Now there are rumors of finished goods manufacturers shuttering plants in China. As warmer weather is on the horizon, travel and leisure spending faces the prospect of a chilling effect upon demand both domestically and internationally.
Even if (and that’s a big “if”) the epidemic stays mostly contained in Asia, our interconnected economies will certainly bear the burdens inherent in an economic slowdown on that continent.
Businesses are only now awakening to the real probabilities of shortages and disruptions, and are scrambling to make alternative plans. Automotive and apparel industries have had to adjust rapidly. Some of the pivots will likely inure to the benefit of domestic producers and suppliers.
The domino effect of many of these eventualities will certainly impact pricing. Expect costs of goods to dramatically swing depending on the severity and scope of the crisis.
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