First COVID, Now Inflation
$52M program to feed NJ’s hungry is keeping restaurants open. When New Jersey launched a pilot program in December 2020, the idea was to fight the pandemic-prompted economic downturn on two fronts. It would, Gov. Phil Murphy’s administration hoped, give a boost to restaurants suffering through shutdowns and restrictions, and meet a growing demand for food assistance that had lines outside pantries stretching for blocks. Sustain and Serve distributes federal COVID-19 dollars and state funds to organizations that help with food insecurity. Those organizations, in turn, purchase meals from restaurants to feed residents in need. More than 500 restaurants in every New Jersey County benefited last year. Millions of meals were served. The program is entering its third round of funding, with more coming this year. It’s too early to say whether the program will continue past that point. But many restaurant owners and nonprofits say more help will be crucial to weathering another economic threat — the extraordinary inflation of the past several months.
Nearly 40% of Restaurants Hit the Brakes on Hiring
Because of inflation. More than a third of the nation’s restaurants are putting their recruitment efforts on hold to protect margins from soaring wage rates, according to a new survey from the Alignable Research Center. The inflationary pressure is so intense that 4% of establishments are even laying off workers, the researcher found. Across all small businesses, the chill on hiring is even more pronounced, with 45% freezing their employment rosters because of inflation, compared with the 38% of restaurants that are taking down their Help Wanted signs, according to Alignable. As in the restaurant category, 4% of the whole small business sector has begun to cut employee head counts. With federal statistics showing the restaurant industry is still 700,000 workers short of its pre-pandemic employment level, Alignable’s findings could be good news for the foodservice companies that are still in recruitment mode. The hiring pause across small businesses means less pressure to outbid other restaurant operators and employers on wages. Roughly 1 in 5 small businesses (18%) are paying 25% more in wages than they did pre-pandemic, Alignable discovered.
Unions Are Adding Some Heat in the Kitchen
For food & beverage employers. The National Labor Relations Board (NLRB) reported that for the first six months of fiscal year 2022 (October 1, 2021 – March 31, 2022), labor unions filed 58 percent more representation petitions than they did during the same period a year earlier. According to a National Public Radio analysis, the accommodations and food services industry makes up nearly 28 percent of new union election petitions (a huge jump from the fewer than four percent of union election petitions coming from the industry a decade ago). Prior to the COVID-19 pandemic, unionization among employees within the food and beverage industry was relatively low. However, many of these employees were deemed essential workers during the COVID-19 pandemic and were required to continue working as the virus spread. As a result, employees in the industry began to demand higher pay and better working conditions. It also seems that just about every day we are seeing a headline about a labor union organizing employees at a national company with a well-recognized brand.
Hooters Energizes Culture by Telling the Stories of its Women
Hooters’ culture starts with its SERVE core values (show you care, elevate the spirit, respect everyone, value feedback, and exceed expectations). Cheryl Whiting-Kish remembers the validation she felt 25 years ago when Hooters named her its first female vice president. Overseeing human resources and training was the epitome of everything she worked on—leadership, subject matter expertise, and the ability to connect and develop people—since beginning as a Hooters Girl. The position catapulted Whiting-Kish into entrepreneurship and consultancy, although she remained connected to the brand in the following decades, whether it was assisting a large franchisee for 10 years or managing the human resources side of opening Hooters Casino Hotel in Las Vegas. In 2019, she found herself completing leadership consultancy work alongside CEO Sal Melilli, who, similar to Whiting-Kish, rose through the ranks after starting as a dishwasher. The shared vision between the two was strong, and Whiting-Kish decided it was best to return full time. “My heart just really began to warm, and I thought at that stage of my career, it would be a very nice way to give back to those who would be following me in the brand and help support future leaders moving forward,” Whiting-Kish says.
How to Fix the #1 Reason Restaurant Customers
Don’t come back. Restaurant owners often think they’re losing customers because of the competition. But what if I told you that while you might be losing a few to competition, it only accounts for about 9% of lost customers? Let’s talk about all the reasons you lose customers, the number one reason 68% of your customers don’t come back and what you need to do to fix it. The main purpose of the hospitality industry is to create memorable experiences for your guests. Everything we do on the restaurant floor is to successfully achieve this result. What is happening when customers don’t come back? Here are the six main reasons why your customers don’t come back, finishing with the number one reason and what you need do to fix it.
Restaurant HR Operations Cost Audit
Four ways to audit the true cost of HR. Inflation, supply chain disruptions, and an unforgiving labor market have created a perfect storm for restaurant owners and operators. The mounting headwinds are unrelenting. While many establishments have tried to combat these disruptions by increasing pay, minimizing menus, raising prices, or simply cutting staff and operating hours, there are other strategies that can ease the burdens of the current operating environment without negatively impacting employees or customers. As costs rise and pressures pile up, the time is now to perform a complete audit of the true costs of human resources operations. We’ve included some straightforward steps below to guide in accurately auditing HR costs. Federal and state unemployment taxes, commonly referred to as FUTA and SUTA/SUI, are often overlooked and/or ignored by operators, but especially with the increased turnover in the industry, it is paramount in controlling HR operations costs.
Scammers Extorted Restaurants with One-Star Google Reviews
Is this the new normal? Beverly Kim owns two restaurants in Chicago and is no stranger to the ups and downs of reviews and criticism. But a series of one-star reviews posted to her restaurant Parachute’s Google business profile in early July raised an alarm. “My initial reaction was, are they being racist? This is a Korean restaurant, maybe people aren’t understanding it,” she said. As it turned out, it wasn’t a racist attack, but it was a coordinated one. A new scam targeting independent restaurants across the country emerged a few weeks ago. First, scammers left multiple one-star ratings on restaurants’ Google listings. Then they emailed the restaurants to demand small cash payments in exchange for deleting the reviews. “Hello. Unfortunately, negative feedback about your establishment has been left by us. And will appear in the future, one review a day. We sincerely apologize for our actions, and would not want to harm your business, but we have no other choice,” the emails read, before asking for $75 gift cards to be sent to an encrypted email address. “The fact is that we live in India and see no other way to survive.” It was extortion by Google rating.
Did You Know?
50 Best Restaurants in the World for 2022. In an announcement certain to divide foodies across the globe, the world’s best restaurants have officially been named for 2022. Unveiled as part of the annual World’s 50 Best Awards, the culinary crusade through the continents delivered more than a few surprises, however, the standout performers hailed from the most expected of origins. The old guard of Paris, London and New York managed to nab a few places in the World’s 50 Best Restaurants list, but for the second year running, it was the exciting and somewhat experimental approach of Copenhagen that took home top honors. Last year’s runner-up Geranium was named the world’s best restaurant, after fellow Copenhagen mainstay and 2021 award-winner, Noma, fell out of eligibility. Turns out those Danes are good for more than just pastry.
Tips for delivering the benefits restaurant employees want and need. t’s been quite a rollercoaster ride for the restaurant industry over the past few years. From a quick adjustment to drive-thru and delivery that accelerated business and profits at the start of the pandemic to the Great Resignation that is leaving restaurants hemorrhaging workers and constantly short-staffed, it’s been a struggle for management to keep up. Adding to the never-ending struggles, restaurants—particularly quick-service locations—are now faced with mounting increases in costs for ingredients and supplies combined with a slowdown in business as consumers become more frugal in the face of rising inflation. Plus, restaurants must deal with significant administrative tasks, including the need to offer insurance for their workforce or face aggressive IRS action for non-compliance with Affordable Care Act (ACA) requirements.
Bielat Santore & Company – Restaurant Industry Alert
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