Restaurants Urge Congress to Kill Inflation-Fueling Tariffs
Look at the fees levied on imports. Struggling to put a rein on the inflation trampling restaurants and consumers alike, Congress and the Biden administration are intensifying their focus on the steep tariffs that were put into place by President Trump to protect some American businesses. Restaurants added their voice to the discussion this week, using the occasion of hearings before a Senate subcommittee to stress that neighborhood restaurants are paying a steep price, literally, for the protections that have been afforded select mega-industries. “Key commodities are creating whiplash for restaurants and customers, especially for eggs (259.9%), butter (50%), unprocessed fin fish (47.3%), flour (36.7%), fats and oils (32.5%), and processed poultry (25.2%),” Sean Kennedy, EVP of public affairs for the National Restaurant Association, said in a letter to the Finance Subcommittee on International Trade, Customs, and Global Competitiveness. We write today to urge Congress to help remove harmful tariffs that are contributing these supply chain challenges and price inflation.
How Many Restaurants Closed from the Pandemic?
Here’s our best estimate. The doomsday prophets materialized just days after indoor dining was shut down in major cities in March 2020. Chef, proprietor and activist Tom Colicchio predicted 75 percent of restaurants would close due to the pandemic (he would later downgrade his nightmare scenario to 40 to 50 percent). A month later, the newly minted Independent Restaurant Coalition went further, predicting that “as many as 85 percent” of independent restaurants might close. Such a collapse could have meant the loss of hundreds of thousands of restaurants. But no such extinction event, as one advocate described the pandemic’s potential impact, occurred. The number of closed establishments to date is a fraction of those early dire predictions, which were based largely on fears or a small-business survey with acknowledged flaws or just educated guesses. Just how many restaurants have succumbed to the pandemic, with its mix of public health restrictions, government shutdowns and shared diner anxiety? That number is difficult to nail down.
Consumers Say Inflation is Causing Them to Eat Out Less Often
8 in 10 consumers say they are cutting back on restaurant visits? Consumers are more willing to cut out visits to restaurants and bars as a result of inflation than they are to take other steps to cut the cost of their regular food bill, according to data from a new survey released on Tuesday. More than 80% of U.S. consumers said they are eating out less often as a result of inflation, according to a Morning Consult survey. And about three-quarters said they are going out to bars less often. By contrast, 72% said they were purchasing less meat and 68% said they were buying less alcohol, according to the survey. Overall, more than half of U.S. adults said they have changed their eating and drinking habits because of inflation. The survey is the latest piece of evidence to suggest restaurants are facing cutbacks over inflation. And more expensive restaurants may be hit hardest. The Consumer Price Index rose 1% in May from April, and 8.6% over the past year. Retail food prices are up nearly 12% over the past year and prices on many basics have taken off: Gas is up by 50% over the past year while energy prices are up nearly 35%.
Pizza and Wings Restaurants Come Back Down to Earth
After an out-of-this-world 2020. Pizza and wings were the clear restaurant winners of 2020, when the pandemic wreaked havoc on everyone from casual dining to fast casual. With online ordering already established and a highly portable product, pizza and wing brands were able to enjoy double-digit sales increases in 2020 even as countless others floundered. In 2021, however, these same brands saw revenue flatten out as the rest of the industry recovered market share. Pizza became ubiquitous in 2020 as consumers sought easily accessible comfort foods at home, with chains like Papa Johns (19% sales growth in 2020) and Domino’s (11%) capitalizing on the trend. But last year, many pizza brands saw positions on the Top 500 slip or sales drop amid shifting consumer mindsets. “Americans like variety,” said Gary Stibel, founder and CEO of The New England Consulting Group. “They hunkered down and pounded down pizzas in ’20 and they wanted to go back to some of the things that they loved and missed, like hamburgers and other things. And so, pizza cooled off in ’21.”
Lessons Learned from Two Years of Socially Distanced Restaurant Management
Modernization. As the restaurant industry has been one of the hardest hit throughout the pandemic, restaurants have quickly adapted to the changing landscape. Reports show that 81 percent of fine dining establishments, 78 percent of family restaurants, and 77 percent of fast-casual spots added curbside pickup, pivoting away from dine-in services after March 2020. On top of that, nearly half of all restaurants offered delivery services during the pandemic. Restaurants finally had to embrace what they had been reluctant to for so long: modernization. Technology has clearly played a huge role in restaurant modernization, especially in light of the pandemic. As a result, the use of self-ordering kiosks and QR codes during the pandemic went up by 750 percent, with 77 percent of survey respondents saying they would prefer contactless ordering and payment once the pandemic ends. Also, menus largely went digital, and more restaurants have since adopted digital menu managers as a way of life. Surveys have shown that these trends are driven primarily by a Millennial customer base, with 64 percent of Millennials saying food delivery and takeout are “essential to the way they live.
3 Lessons Restaurants Can Learn from Retail
The retail industry has been ahead of the curve with technology. Retail and restaurants may appear to be two very different industries with little in common, but they both share a common need to create positive customer experiences. The retail industry is ahead of restaurants in its use of technology. Amazon was a major force driving this change in the mid-2000s, as it created a digital-first consumer experience where it was possible to buy almost anything through its online store. As the restaurant industry continues its recovery from COVID, operators can learn some interesting lessons from the changes that retail stores went through. Much like the restaurant industry, retail has also experienced significant shifts, both due to the pandemic and changing consumer shopping habits and expectations. The abrupt changes brought on by the pandemic forced retailers to find new ways to serve and reach their customers, and to reimagine the future of in-store experiences and face-to-face engagement with clientele. Retail brands were forced to adapt even more than they had in the past to a hybrid digital and physical experience for customers, for example, by offering “order ahead” combined with curbside pickup. Here are three things that restaurants can learn from the retail industry.
Complaints Over Short-Staffed Restaurants Up 229%
In Q1. More than 13 million diners were seated at restaurants via Yelp during Q1 2022, a rise of 48% compared to the year-ago quarter, according to Yelp’s State of the Restaurant Industry Report emailed to Restaurant Dive. Yelp also recorded a 23% increase in customers mentioning long wait times and a 229% increase in reviews mentioning short staffing during Q1 2022 compared to the year-ago quarter. Restaurants have continued to tweak their operating hours, menu options, available tables and other operations to address these challenges, Yelp said. Yelp’s data also indicates more consumers are seeking out higher-priced dining experiences to get more for their money as inflation rises. Menu prices were up 7.4% overall during the month of May, according to the Consumer Price Index. By and large, interest in on-premise dining doesn’t seem to be slowing down despite increased prices and slower service. Searches for reservations in Q1 2022 increased 107% on Yelp compared to the year-ago quarter. While interest remains strong for outdoor dining — with searches up 1,060% in Q1 2022 compared to Q1 2020 — searches for indoor dining surged 6,360% on Yelp’s platform over the same period.
Did You Know?
Top 5 books every restaurant owner should read. Business books have changed my life and they have the power to do the same for you. I read at least one new book a month and there have been times when I have read one new book a week. Suggested are five business books that cover a variety of topics related to operating your restaurant. Most of these books are easy reads or listens if you prefer audio books. Some of these books, you might not have considered reading as a restaurant owner but definitely should read if your serious about the growth of your business. Happy reading (or listening)!
How to keep employees happy. During the Great Resignation of late 2021, staggering numbers of employees left their jobs in search of new opportunities. Lack of opportunity, low pay, difficulty with childcare, and feeling disrespected at work were amongst a wide variety of factors listed as motivators. Amongst those who left their workplace, one-fourth of those were in the hospitality industry. As of early 2022, there were still 11.5 million open jobs, with organizations challenged to hire amidst unprecedented competition for talent. With 70 percent of restaurant operators reporting labor and staffing issues and not being able to keep up with demand, how can restaurants boost employee satisfaction and retention? There’s good news! In addition to paying a competitive salary, there are many other ways restaurateurs can boost employee satisfaction and happiness.
Bielat Santore & Company – Restaurant Industry Alert
OCEAN COUNTY, NJ DINER FOR SALE
Photo shown to illustrate “typical diner only.” Not actual representation.
SALE OF BUSINESS; GOODWILL & FF&E ONLY
EXCELLENT OPPORTUNITY to take over a family-run, local diner with an (18) year track record and loyal customer base! The 1,300 square foot diner has seating for (65) with an outside area seating an additional (25). Subject Diner shares a stirp center with another business and a nationally known convenience store.
Click here for more information
Contact “Diner” Bob Gillis 732-673-3436 for additional information.
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