Minda Wu
NIU does its best to keep prices low for students, but due to this recent inflation, some price increases are inevitable.
Decarb — NIU’s campus dining service is beginning to feel the effects of the historic shock wave of inflation as food and grocery prices reach record highs in the country. Students are starting to feel the effects of higher prices in grocery stores, and cafeterias are now choppy.
Since July 2021, food prices in U.S. grocery stores have risen 13.1%, and food prices in restaurants have risen 7.6%. according to reports From the U.S. Department of Agriculture. The USDA predicts that food prices will generally rise about 3% by next year.
As the US food market becomes more and more volatile, the NIU will do little or change to be swept away by a wave of inflation.
How NIU Offers Students
NIU has an exclusive contract to purchase food in bulk from Gordon Food Service, which prevents NIU from negotiating food prices even after significant food inflation.
Daniel Koenen, Executive Director of Campus Dining Services and Hospitality Instructor at NIU, said the price of certain foods increased by “hundreds of percent” during the COVID-19 pandemic, and between 2019 and 2022, GFS’ Food prices have risen about 32%, he said. Under NIU’s contract with GFS, the university receives rebates on food purchased in bulk from suppliers.
Koenen said arguably a bigger problem than the price hike was the supply chain issue for NIU’s dining service.
“Our agreement with GFS is that if the item we ordered is out of stock, we will send you a ‘similar product,’” says Koenen.
This put pressure on the NIU cafeteria. Ordering a specific product may send you a “similar product” that may cost significantly more than usual.
PepsiCo is another large NIU food and beverage partner. The school and his 10-year contract with them also took a toll on campus meals due to price changes and supply issues.
“We saw a 43% increase in prices[on the new contracts],” said Koenen.
NIU’s primary incentives for signing with PepsiCo are sponsorship dollars used for scholarships and campus advertising.
The fight to stabilize prices
Koenen explained that while NIU does its best not to pass these price increases on to diners, there are certain corners that must be cut.
“We do our best not to increase prices significantly, but if they do increase significantly, we will have to adjust,” Koenen said.
With the NIU bearing the brunt of food inflation, only time can improve the situation. Carl Campbell III, professor and head of economics, said inflation is often caused by external factors over which a country has little or no control, such as the war in Ukraine caused crop and oil shortages. .
These external factors allow the federal government to fight inflation only with temporary fixes. Campbell said raising interest rates could reduce demand for food and food services, but this tactic is a slippery slope.
“If inflation gets out of hand, it can be very disruptive,” Campbell said. Clearly, anything higher than that can start to have more detrimental effects.”