Over the past few years, operators have weathered one economic spike after another, and the ripple effects from those cost pressures continue to squeeze operating budgets across food, packaging, labor, utilities and transportation. At the same time, customers remain hyper-focused on value, expecting premium experiences without major price increases.

The good news: Entegra’s latest Cost Outlook Report shows greater stability in some key categories, creating opportunities for smarter planning and purchasing with the support of a group purchasing organization (GPO). Here are seven questions operators should ask their GPO partner as they prepare for 2027. 

Cost trends for 2027, at a glance

1. Ongoing high operating costs, now with a more predictable pattern
2. Continued labor constraints
3. Volatile energy and transportation costs
4. Persistently high beef prices
5. Stronger chicken and egg supplies
6. Produce cost fluctuations
7. Higher packaging, supply and equipment costs 

1. Are operating costs becoming less volatile in 2027?

Operating cost pressures aren't going away, but they're becoming more predictable.  

“The supply chain has become more resilient and production has caught up since the immediate post-COVID period,” says Dr. Henry Zerby, Vice President of Supply Management, Food. “But the macroeconomic pressures around the supply chain are more volatile, so operators should expect continued market volatility.”  

Operators can work with their GPO to help them actively manage costs, negotiate supplier contracts and optimize menus. 

How can operators prepare with the support of a GPO?

• Review pricing strategies regularly
• Use market intelligence to forecast expenses
• Focus on margin improvement opportunities before costs rise again 

2. How will the labor market change in 2027?

Labor is expected to remain one of the biggest operational challenges next year. “Labor costs also remain a key consideration as employers continue to compete for talent,” says David Kourie, Chief Procurement Officer for Sodexo and SVP of Supply Management for Entegra.  

Unemployment remains relatively low at 4.0-4.5% and wage growth has held steady near 4.0% over the past year, according to the Cost Outlook Report. Stricter immigration policies could further constrain labor availability in food and agriculture sectors. 

How can operators prepare with the support of a GPO?

• Invest in labor-saving processes and equipment
• Cross-train team members
• Evaluate menu complexity and staffing models 

3. How will energy costs affect hospitality-driven businesses next year?

Energy remains a major wildcard as geopolitical tensions and fuel markets create continued uncertainty. Higher prices can affect transportation, distribution and operating expenses throughout the supply chain, with impacts reaching food, utilities and packaging.

How can operators prepare with the support of a GPO?

• Review energy management strategies
• Expect transportation costs to remain volatile
• Build flexibility into procurement budgets

Read more: What crude oil volatility means for your business 

4. What will the beef market look like in 2027?

Beef prices are likely to remain elevated in 2027 because the market is historically tight and herd rebuilding takes time. According to the Cost Outlook Report, New World screwworm also presents an animal-health risk and could disrupt cattle movement.

“While producers are beginning to retain more heifers to grow the U.S. herd, the results aren’t instant,” says Dr. Zerby. “It will take time for calves to reach maturity, and that means the market will remain constricted for a while.”

Despite the higher prices, beef demand remains strong, giving operators an incentive to retain popular beef dishes while carefully managing portions, plate costs and menu placement.  

How can operators prepare with the support of a GPO?

• Review portion sizes and plate costs
• Feature beef strategically rather than broadly
• Explore opportunities to mix or substitute beef with other proteins to reduce exposure to rising beef costs

Read more: How a hospitality procurement service can cut beef costs

5. Which proteins will offer cost stability in 2027?

Chicken and eggs offer more cost stability. Unlike beef, chicken production is expected to continue growing, supported by favorable feed costs and strong demand. Egg markets are also recovering as flocks rebuild and production improves. Although avian flu remains a risk, improving supplies may help operators balance menus and manage protein costs. 

How can operators prepare with the support of a GPO?

• Position chicken as a premium, health-forward ingredient
• Consider what type of chicken best suits your operational model: fresh, frozen or controlled vacuum-packed chicken (CVP)
• Offset other time-consuming ingredients with chicken and egg products that reduce prep and labor time

Read more: CVP chicken report for foodservice operators

6. Which produce costs should operators watch in 2027?  

Produce costs will vary significantly by category in 2027, making seasonal menus and flexible recipes especially important. In the latest Cost Outlook from Entegra, a few produce categories stand out:

• Avocados are expected to see firmer pricing with strong demand and tighter supply
• Tomatoes face a structurally higher price environment due to import tariff changes and supply pressures
• Bell peppers, onions and potatoes are expected to remain relatively balanced 

How can operators prepare with the support of a GPO?

• Build seasonal flexibility into menus
• Identify substitute ingredients when appropriate
• Use purchasing forecasts to time promotions

Read more: How a GPO can help you reduce costs

7. Why should operators monitor packaging, supplies and equipment costs?  

Packaging, supplies and equipment continue to drive operational costs up. While this broad category is often overlooked, operators are feeling the pressure mount every day. Paper packaging, resins, aluminum, steel, textiles and MRO supplies continue to face inflationary pressure driven by capacity reductions, energy costs and trade policy. 

How can operators prepare with the support of a GPO?

• Extend procurement planning beyond food to packaging, disposables, uniforms, linens and equipment
• Look for contract compliance opportunities
• Include packaging and supply costs in budget planning

Read more: How you can improve efficiency with a hospitality procurement company

How does Entegra research and report on inflation?

Entegra draws from trusted inflation indices, including the Consumer Price Index for Food Away From Home and the Producer Price Index. This blended approach ensures our reports cover all Entegra contract types and segment-specific needs for hospitality-driven businesses like restaurants, hotels and senior living communities. 

How does Entegra help operators overcome inflation as a GPO partner?

Entegra’s Supply Management team creates a wealth of inflation resources for operators, including:

• Cost Outlook: A robust, biannual look at how market forces impact your costs
• Inflation Report: A monthly report for clients highlighting food price trends
• Program and Pricing Update: A monthly report for clients on price and contract changes
• Commodity Report: A monthly report for clients on commodity market trends 

Position your business to win in 2027 with the Entegra Cost Outlook  

Although 2027 may bring greater cost stability, operators still face labor constraints, elevated protein costs, energy volatility and supply chain uncertainty. Working with a GPO like Entegra and leveraging market intelligence to guide your purchasing, menu and operational decisions can help you protect margins while continuing to deliver value to guests in 2027 and beyond.

Plan for 2027 with confidence using Entegra’s latest Cost Outlook Report.

Frequently asked questions

What is Entegra?  

Entegra is the world’s largest group purchasing organization, empowering your business to tap into $50 billion in purchasing power worldwide. A global leader in hospitality procurement, Entegra's client teams deeply understand your industry, providing you with the expertise, personal attention and transparency your business deserves.

How does Entegra's pricing compare to other GPOs?  

You can save up to 30% when compared to supplier list prices. As a client, you also gain access to deeper discounts, AI-powered product swaps that reduce costs and a team of industry experts negotiating supplier contracts on your behalf.

Will I have to switch distributors or buy different products?  

No, Entegra works with multiple distribution partners and over 2,700 supplier partners, providing access to the selections you trust. And if you can’t find what you need, we offer flexible custom contracting.

How do I order products and services for my company?

The first step to ordering products and services for your company is to contact an Entegra team member. We'll get you started, and then you can begin by selecting the best products for your business. We'll notify your distributors about your transition to our program, keep you up to date and provide strategic purchasing advice.

Am I locked into minimum purchasing requirements?  

No, you are free to purchase as much or as little as you like through Entegra's GPO procurement services. The closer you work with our experts, the better we can support you in achieving your business goals.