How Digital Engagement is Reshaping the $320 Billion Food Service Industry

For Mani Kulasooriya, co-founder and CEO of Cut+Dry, an eCommerce and advertising platform for independent food service distributors and manufacturers, digital engagement is impacting the industry in new ways.

“Digital engagement is transforming the food service industry, much like it did for retail grocery,” Kulasooriya said in an interview with PYMNTS. “For years, the $320 billion food service market was overlooked by ad dollars because the industry lacked the infrastructure and tools to enable digital advertising — most distributors weren’t digital.”

The move toward digital advertising is now becoming more of a reality, as evidenced by Cut+Dry’s latest partnership with Instacart.

Making Connections

By integrating Instacart’s Carrot Ads technology, Cut+Dry is creating new opportunities for food manufacturers and distributors to connect with buyers, elevate brand visibility and generate extra revenue.

“Our singular focus has been to address inefficiencies in the food service industry through digital innovation,” Kulasooriya said. “This is a clear reflection of the industry’s dire need for digital tools to compete in today’s economy and our new partnership with Instacart signals the next phase of our growth. By bridging the gap between brands, distributors and operators, we’re bringing advanced solutions to a sector that’s been widely underserved by digital innovation. With data visibility as a guide, we will create a more efficient ecosystem that drives better decision-making for the entire food industry.”

With Carrot Ads on Cut+Dry’s platform, Kulasooriya said brands can engage buyers at the moment of decision-making.

“Whether it’s showcasing products during seasonal promotions or pairing ads with menu inspiration, this approach is creating new opportunities for innovation, revenue growth and meaningful connections with restaurant operators who were once hard to reach,” he said. “For distributors, the ability to unlock new revenue through digital advertising is groundbreaking.”

Through its platform, Cut+Dry enhances the relationship between distributors and restaurants by equipping distributors with modern eCommerce tools for online ordering, payments and truck tracking, Kulasooriya noted. These capabilities drive customer loyalty and position distributors as indispensable partners in the food service ecosystem.

“Digital tools like product details, recipes and menu inspiration empower restaurants and grocers to make data-informed decisions,” Kulasooriya said. “For restaurants, this means they can source the right products, design profitable menus and streamline their purchasing processes. For grocers, these insights help align inventory with customer demand, reducing waste and improving the shopper experience. Ultimately, these tools lead to better efficiency, higher-quality offerings and a more personalized experience for end customers — whether they’re dining out or shopping for groceries.”

In November, Instacart said it was moving to strengthen ties with groceries and other businesses to expand its services to boost its business.

Leveraging Tech

As digital engagement becomes a key for customer loyalty and brand visibility in food service, Cut+Dry is leveraging these tools to strengthen connections between brands, distributors and operators.

“Without properly structured data and detailed product information, you cannot build a successful eCommerce or digital advertising business,” Kulasooriya said. “Imagine trying to buy a product on Amazon without any descriptions or images — no one would, and neither would I.

“In food service, this is especially critical,” he continued. “Distributors and brands need to provide clear, accurate and comprehensive product data to enable smarter purchasing decisions and effective advertising. Cut+Dry’s platform ensures this foundational element is in place, empowering distributors and brands to deliver tailored recommendations, actionable insights and engaging ads that resonate with restaurant operators.”

By focusing on structured data and seamless digital engagement, “we’re not just modernizing food service — we’re creating trust, driving loyalty and unlocking new growth opportunities for every stakeholder in the ecosystem,” he said.

As the food service industry moves toward greater digital adoption, Kulasooriya noted the future of digital engagement lies in hyper-personalization, real-time insights and integrated solutions across the entire supply chain.

“As operators and distributors adopt digital tools, data-driven decision-making is becoming the norm,” he said. “Our partnership with Instacart is a prime example of how we’re driving innovation, bringing the same level of digital sophistication that reshaped grocery into the food service sector. Introducing digital sophistication to the food service industry is just the start. We’re constantly looking ahead to anticipate what’s next for the industry and ensuring that we provide the tools and solutions to lead food service through its next wave of digital evolution.”