Supply chain

Fatburger, parent of Johnny Rockets: Supply chain shortage is ‘real’ and won’t go away

FAT Brands Inc. CEO Andrew Wiederhorn said the supply chain shortage is “real” and will not “go away”.

“The supply chain isn’t just about the costs of the food, it’s about the drivers and the labor shortage everywhere,” Wiederhorn told “Cavuto: Coast to Coast” , Friday.

FAT Brands owns 14 different restaurant brands, including Fatburger and Johnny Rockets.

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Wiederhorn’s comments follow producer prices rising at the fastest annual pace on record for the fifth consecutive month in August. Supply chain disruptions and material shortages continued to put upward pressure on costs.

“The supply chain pricing situation is really hurting restaurant franchise operators,” added the CEO of FAT Brands.

“They have to take the price, in terms of the increase in the price of the products they sell, and I think that’s going to continue for a while. I just don’t see that being transient.”

Wiederhorn argued that restaurateurs operate at a 5% to 15% margin and if there is a significant increase in food costs, companies will be forced to increase their prices as well to “stay in business, earn money. ‘money and pay the bills “.

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Meanwhile, recent data from the Ministry of Labor shows a growing gap between vacancies and hiring, which comes as companies struggle to fill positions despite more than 8 million people unemployed. .

Despite the labor shortage in the United States, he said the “restaurant industry is back” and “booming” since the start of the coronavirus pandemic.

However, Wiederhorn noted that vaccination mandates have become an additional challenge for restaurants.

“It’s really difficult for operators. They have enough things to do to restart their business after COVID,” he noted. “Now they have to be the vaccine police, that really puts the burden where I don’t think it belongs.”

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The CEO of FAT Brands suggested that the government should be “understanding” and everyone should be patient, but supportive.

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“Of course, I want everyone to be vaccinated, but this approach of asking the… the restaurant… a hostess or hosts to check the vaccination card is crazy.”

FOX Business’s Talia Kaplan and Jonathan Garber contributed to this report.


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