An Extra $10M for Restaurants & Nonprofits
Provided through the American Rescue Plan. An additional $10 million in funding, provided through the American Rescue Plan, is being made available to New Jersey restaurants and community nonprofit organizations through Phase 3 of the Sustain & Serve NJ program. Launched by the New Jersey Economic Development Authority in December 2020, the program has already provided 1.9 million meals to needy families by more than 400 participating restaurants. By the end of the year, the program will have given some $45 million to restaurants and nonprofits. According to Gov. Phil Murphy, who spoke today in front of Tavern on George in New Brunswick, a restaurant participating in the Sustain and Serve NJ program, “One of the most critical programs the NJEDA has put together [during the pandemic] was Sustain & Serve, which provides grants not just to restaurants, but to community-based nonprofits, who, in turn, use those funds to buy meals from those restaurants and distribute them to families facing food insecurity. This partnership has been the ultimate win-win.” Murphy said that too many families are still facing food insecurity and too many restaurants are still working hard to keep their “ovens hot and their doors open.”
New Jersey Governor’s Race Could Slip into Recount Margin
GOP Candidate’s lawyer says. While New Jersey Gov. Phil Murphy continues to lead Republican Jack Ciattarelli in votes for the gubernatorial race, Ciattarelli’s lawyer said the margin between the two candidates could narrow enough to warrant a recount, the Associated Press reported. The AP declared Murphy as winner last week and other sources project a final victory by tens of thousands of votes, but Ciattarelli has so far declined to concede to the incumbent governor. Though Murphy only led the race by less than a percentage point last week, his margin grew to about 2.6 points on Monday. That equates to a roughly 65,000-vote lead for Murphy, the AP reported. Ciattarelli’s campaign estimates that roughly 70,000 provisional votes, or ballots only counted after election officials confirm that the voter hasn’t cast another ballot, remain uncounted. It is unknown how many mail-in ballots also remain uncounted.
Preparing for the Future of the Restaurant Labor Market
It’s been a roller-coaster ride for restaurant workers. The restaurant industry was among the industries most impacted by the pandemic, but I believe it is in the midst of a major comeback. There is a newfound hope and optimism for some as the industry recovers from the devastating blows over the past year and a half. There were government-mandated shutdowns, layoffs and newly defined safety protocols that forced the industry to be innovative to survive. However, customers are coming back, and restaurants are adapting to a changing landscape. The food service industry has also taken giant steps forward technologically, looking much different than the snapshot taken prior to March 2020. While advanced technologies and adaptive food service have become the new landscape, the industry remains a labor-intensive business. In fact, about 30% of restaurant revenue is spent on labor. Although online ordering, curbside pickup, delivery, to-go and meal prep kits have streamlined the convenience factor for diners throughout the pandemic and beyond, all those features are dependent on labor. That labor force has not been operating at full power. But I believe change is coming.
Restaurants Face New Challenge
A shortage of take-out containers and coffee cups. Consumers are returning to restaurants in droves, but continued demand for takeout is exacerbating shortages of items like plastic straws, coffee cups and to-go containers. Snarls in the global supply chain have been rippling across the economy for months as the health crisis has created bottlenecks and other new challenges for companies. Integral components like semiconductors have been in short supply, sending shockwaves through a number of industries. For the restaurant business, supply chain challenges have resulted in rising food costs and shortages of key ingredients like chicken. And as consumers shift back to ordering from restaurants more often, many still aren’t eating their meals inside dining rooms. Off-premise restaurant orders were up 20% in September compared with the same time two years ago, according to the NPD Group. Higher demand for takeout containers, napkins and to-go cups are putting even more pressure on restaurants’ supply chains.
Welcome to the Restaurant Inflation Story of COVID-19
Prices are soaring and sales are holding. But what comes next? After a lengthy stretch of soft results, the restaurant industry is enjoying some upward movement again. In the week ending October 17, restaurants posted their strongest sales and traffic growth in four weeks, according to Black Box Intelligence. But there is an underlying driver worth tracking—year-over-year check growth of 5.7 percent, the highest figure recorded since mid-April. Check growth has lifted 5 percent or more during each of the last seven weeks. A quick trip around this earnings season (see Wingstop, McDonald’s, Texas Roadhouse, Outback, and Chili’s) suggests brands of every size and category are doing their best to hold margins amid an inflationary environment that shows no signs of sliding. The silver lining is, to Black Box’s data, rising sales are making this a cost-management battle in many cases. As Brinker International CEO Wyman Roberts put it: “After 40 years, I’ll take managing costs over searching for sales and traffic any day. Those are good problems to solve because they’re largely within our control.” Although that stretches to a point. “The thing that is the challenge for us are the things we can’t necessarily control right in front of us, the macro headwinds,” Wingstop CEO Charlie Morrison said of wing prices (more on that later).
Inspire Brands Launches a Ghost Kitchen
As more restaurants lean into virtual restaurants. As labor challenges continue across the fast-food space and customers seek seamless interactions with digital ordering, major restaurant players are leaning into the ghost and virtual kitchen space to optimize efficiencies and speed up service. Inspire Brands announced Tuesday the launch of a multi-brand ghost kitchen in Atlanta that will serve customers from its portfolio of fast-food companies including Arby’s, Buffalo Wild Wings, Jimmy John’s, Sonic Drive-In and Rusty Taco. The concept, dubbed Alliance Kitchen, will allow customers to order from both third-party aggregator platforms and the brands’ apps. Its debut comes as Inspire’s digital sales have more than doubled since 2019 to just over $6 billion, said Stephanie Sentell, senior vice president of restaurant operations and innovation at Inspire, in an interview. Inspire, which is privately held, did not disclose the size of its investment. Alliance Kitchen is already operating, having opened its doors in a quiet rollout in July. The company said it is its first restaurant owned and developed ghost kitchen, and it allows Inspire to test ideas from its Innovation Center — like its Flippy Robot, which can be used to cook wings — in a real restaurant environment.
Perspectives and Solutions for Working Through Supply Chain Challenges
Sold out. If you run a restaurant or commercial kitchen, the good news is your dining patrons are coming back — and, many times, in record numbers. The bad news is every call you make looking for food, equipment, or supplies is a disappointment; distributors seem to be sold out of many items. We at Imperial Dade are on the other side of that phone call, and we feel and share that frustration first-hand. We’ve built a business and reputation on being able to fill the needs of our customers and the latest of the COVID-19 fallout has been challenging. To get to the source of this frustration facing us all, I’ve spoken with one of our market segment experts, Oliver Munoz, to see if we can help sort this out. A labor shortage in freight and transportation also created a backlog globally. Then the bottleneck of transportation and shipping ports and terminals backed up. Labor shortages continued at the manufacturing level to the point that production had to be cut. A snowball effect in each turn of events created ballooning circumstances that continue to be very difficult to overcome.
Bankruptcy: A Lifeline for Restaurants
It may be a viable option. With the pandemic impacting small businesses, especially those in the food industry who have seen supply lines disrupted and have faced difficulty in retaining staff. Many of these businesses have yet to recover from the economic shutdowns from the pandemic. While many businesses have been fortunate to have creditors such as landlords, banks and vendors work with them and provide necessary relief from debtors, many businesses were not so fortunate. These businesses may be left with crushing debt that simply cannot be repaid in any meaningful way. For these businesses, bankruptcy may be a viable option. Traditionally there were two options for businesses in the bankruptcy code. Under Chapter 7, the debtor business liquidates all their assets, which are then distributed among its creditors, and goes out of business. Chapter 7 involves the end of the business and the appointment of a trustee, who among other responsibilities is tasked with recovering monies for creditors. Armed with so-called “strong arm” powers, the trustee can sue owners and others to recover preferential payments and “fraudulent conveyances” under either state or federal law. These aspects often make Chapter 7 an unattractive option for many small business owners, who may choose to liquidate without the benefit of bankruptcy petition.
Former FDA Commissioner Believes the Pandemic is Easing
Biden Administration’s employer vaccine mandate is unnecessary. Dr. Scott Gottlieb, the former commissioner of the U.S. Food and Drug Administration, painted an optimistic outlook on the state of the pandemic Monday, suggesting that a high rate of immunity will likely bring down infections after the holidays. Speaking at the Restaurant Finance & Development Conference, Gottlieb said he believes we’re in “the last major wave” of a pandemic that has upended the economy and the restaurant industry as a whole. “Barring something very unexpected, which we don’t see happening, we really could be through this,” Gottlieb said. “It’s not something that’s going to dominate our lives.” New coronavirus infections have been cut in half since the summer surge brought on by the more virulent delta variation of COVID-19, according to data from the U.S. Centers for Disease Control and Prevention. Cases have plateaued at about 70,000 per day more recently, which Gottlieb attributed to the variant moving into more populated areas.
Did You Know?
Six ways contactless payments improve the dining experience. Contactless ordering and pay-at-the-table systems had already started gaining a slow-but-steady foothold over the past three years. Then the COVID-19 pandemic happened. That, in turn, forced the acceleration of adoption of contactless ordering and payment options from both the consumer and the restaurant sides of the business. Now, two years into the pandemic and with things returning to some form of normal, contactless payments and ordering continue to be an integral way of doing business for restaurants ranging from cozy neighborhood mom-and-pop lunch spots to fast casual behemoths with locations around the world. So, why is that? For one, diners are getting used to it. A survey of 1,000 American adults by digital signage technology platform Raydiant found that:
Employers who hiked worker pay say they’re not suffering from staff shortages. Some employers who hiked wages to help keep their businesses staffed say they’re not struggling for workers amid the nationwide labor shortage. They include a Michigan bar owner who says she pays staff $15 an hour, and a Manhattan restaurant owner who says she raised her starting wage to $25 an hour. The US is suffering from a huge labor shortage as workers quit their jobs in search of better wages, benefits, and working conditions. Companies have been boosting wages to attract new workers and keep existing ones, in many cases raising their prices or cutting their operating hours to cover higher staff pay.
Bielat Santore & Company – Restaurant Industry Daily Alerts
A voice for our industry. If you are finding these weekly bulletins informative and beneficial during this pandemic, we kindly ask that you write a brief Google review providing a vote of your appreciation. Simply Google “Bielat Santore & Company” and when the company name appears click the button on the right to write your review or; if you don’t use Gmail, go to Google Maps, type “Bielat Santore & Company” – Allenhurst, NJ into Google Maps; scroll down and you will see an option to leave a review.
We invite you to visit our website, where you will find all our current listing inventory, a library of helpful industry resources and a collection of client testimonials expressing their assessments on our work and our service within the restaurant industry.