Restaurant Sales Showed Some Surprising Strength Last Month
Restaurant and bar sales are up 9.2% over the past year. Student loan repayments are apparently having little discernable impact on restaurant sales, at least according to the latest federal retail sales data. Restaurant and bar sales rose 0.9% in September from August, part of some surprisingly resilient retail sales last month according to new data from the U.S. Census. On an annual basis, restaurant sales are up 9.2%, a rate higher than the overall rate of inflation. Over the past four years, despite a global pandemic, widespread closures of dine-in service, an overall reduction in restaurants and generationally high inflation, industry sales are up 39%. Overall, retail sales rose 0.7% in September and 3.9% over the past year. Spending at grocery stores rose 0.4%, less than half the rate of growth at restaurants. Some of that is due to price increases, as restaurants and bars have been raising prices more aggressively than grocers in recent months. But the “gap” in pricing between the two providers of food to consumers doesn’t appear to be doing much to discourage restaurant spending. wo likely reasons: Consumers have jobs, and they prefer spending on experiences. Employment has continued to remain strong, with the unemployment rate effectively at full employment at 3.8%. When people have jobs, they have money to spend at restaurants and less time to prepare food at home. Perhaps more important: They would rather eat out than spend on other things. Consumers appear to be shifting their spending, but are not spending less overall, preferring experiences over goods.
Weather and Wallets Will Impact Restaurant Menu Planning Next Year
“What’s in store for 2024.” Americans were pretty bullish on restaurants throughout 2023, but the landscape seems to be shifting for 2024. With prices high and consumer confidence sagging, restaurants will have to be more strategic and creative to snag dining dollars next year. Taking factors like climate change, remote work and TikTok into account can positively impact menu development and sales, according to “What’s in Store for 2024,” a new report from Restaurant Business sister company, Technomic. These seven trends are worth watching to meet the challenges ahead. The wild ride subsides. The restaurant industry as a whole experienced significant growth following the pandemic, but that recovery will start leveling off in 2024. Technomic predicts that most segments should return to low single-digit rates of growth. An aging population and lower birth rates will make organic growth difficult. Although limited service will benefit from consumers continuing to trade down, full-service restaurants are tasked with doubling down on delivering engaging experiences. Extreme weather takes restaurants by storm. Torrential rains, scorching temperatures and deep freezes—2023 saw them all. Operators have to increasingly factor weather into menu planning, equipment and design. Kitchen reconfigurations, upgraded HVAC systems, misters and fans can make it more comfortable for staff and more inviting for guests. Summer menus already feature lighter dishes, but these may move into spring and fall as global warming extends the season. And climate change can impact the availability, flavor and quality of certain ingredients and products, pushing restaurants to diversify sourcing.
Bielat Santore & Company – Restaurant Industry Alert
MONMOUTH COUNTY, NJ RESTAURANT AND BAR FOR SALE
ASKING PRICE REDUCED BY $200K FOR QUICK SALE!
Photo used to depict “Restaurant/Bar” only. Not actual representation.
Monmouth County Downtown Restaurant/Bar; located in the hub of entertainment district; institution at the NJ Shore – 50-year track record; turn-key business w/valuable liquor license; real estate included in sale; 4,584 square foot building; seats 72 dining, 40 at bar and 50 outside; grossing $35K/week; financing available to qualified.
Contact Richard Santore 732.531.4200 for additional information.
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 of our work and our service within the restaurant industry.
A voice for our industry. If you find these weekly bulletins informative and beneficial, 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.
Restaurant Inventory Management
A game changer. Why is taking inventory worth it? The short answer is it’s not just about calculating your cost of goods sold, it’s about ordering and cash flow. Let’s talk about restaurant inventory management and how it’s a game changer. Inventory is a fundamental tool you must use if you want to have restaurant success. I often hear from restaurant owners and managers alike that taking inventory is too monotonous, too time consuming and won’t make a difference in the restaurant because your chef, your kitchen manager, your general manager, even your bar manager tells you they know what they need and what things cost. They’ve got it all in their head. Let’s blow this misconception out of the water and demonstrate why taking inventory and managing your inventory is critical to your success. Let me tell you how I learned the importance of inventory. And funny enough, I learned it from one of the worst managers I’ve ever worked for in my life. He walked me into a walk-in cooler and said, “David, what do you see?” I looked at him and the shelves and told him I saw food. He said, “No! It’s money.” By the way, this proves you can learn something from anyone. You need to understand that your restaurant’s inventory has a direct connection to your cash flow because what is on the shelves is money. I can tell you right now that there are restaurants that have so much food on the shelves that they put themselves in a cash flow crunch. The last time I checked you can’t go to the power company and pay your bill with a case of steaks. You need money to pay your bills.
Five Ways to Increase Employee Retention
With the next generation of chefs. Finding employees willing to take on the demanding hard work of a kitchen and retaining those employees has always been a struggle, and it’s time restaurants begin looking at solutions to the problem for the next generation of chefs. This generation, Gen Z, has grown up relentlessly surrounded by technology — whether it’s at-school laptops, online gaming, or digital communication, it’s here to stay. In order to grow productivity and retain workers long-term, it’s essential to tie technology into the kitchen. Here are a few ways I learned from personal experience as an executive chef that using technology can help retain workers, make each employee feel comfortable in their role, and foster long-lasting relationships. Onboarding is critical to keeping and maintaining good employees, but luckily, technology can help perfect this challenging process. Through tech, business owners and managers can begin with clear expectations up front, whether that’s providing an online checklist, instructions or video onboarding. This familiar excitement towards tech can reinforce a sense of purpose within Gen Z workers. In any workplace, communication is the pillar of success. There’s a constant back and forth in kitchen settings, and this can sometimes lead to confusing or opposing information. One way to combat this is to streamline through team chats and bridge communication gaps that may occur. Team chats make it easy to share, announce, mention and never miss a beat when it comes to your team’s communication. Not only does this streamline any and all communication, communicating online is more efficient, effective and faster.
The Cost of Doing Business
Hidden payment fee red flags. Both legacy restaurants and newer establishments can agree that the literal cost of doing business from payment processing can severely hamper revenue growth from the first sale. There is nothing more ubiquitous than cashless payments, but the ease of credit card use for a customer can create a significant cost for restaurants through exorbitant payment processing fees. As an increasing amount of consumers use credit cards to pay for dining, the swipe fees continue to mount, eating into razor-thin margins, which average about three to five percent in the restaurant industry. In April, Visa and Mastercard raised transaction fees which are estimated to cost U.S. business owners an added $1.2 billion in fees. To help recoup the cost of accepting cards, some restaurants are raising the prices of menu items, and others (where permitted by state law and merchant services agreement) are adding a credit card surcharge to bills. Restaurants must carefully choose their payment processing partners and payment methods to minimize these costs. Negotiating favorable rates and understanding the fee structures are crucial. A laundry list of shorthand and abbreviated terms found in a monthly payment processing statement can be difficult to navigate and even more difficult to decipher. There are multiple signs that restaurateurs should pay attention to mitigate the rising cost of credit card processing, software and service fees. Payment processing pricing structures often used by restaurants allow payment processing providers to layer their processing fees on top of other underlying debit and credit card fees. The main component of these underlying fees is the “interchange” fee, collected by the card-issuing bank and set by the card network, based on networks, cards and transaction types. Each of these combinations results in a different amount of underlying fees, which can often be less than transparent.:
Want to Grow Your Restaurant Business?
Start within your four walls. So, you want to grow your emerging restaurant business? It’s a logical goal, no doubt, but understanding how to do it – and do it right – can be downright paralyzing. For starters, you need capital. According to Lauren Fernandez, CEO and founder of investment firm Full Course, most small businesses fail because they’re undercapitalized. During the CREATE: The Experience event in Palm Springs, Calif., earlier this month, she outlined three types of financing restaurateurs should consider for their capital strategy, including debt, equity and gifts. Of course, each comes with their own reward/risk implications, but none are even worth considering if the business itself isn’t on solid ground. Accordingly, a recurring theme presented by investors at the event was the importance of focusing on growth within your four walls, versus scaling the business just for growth’s sake. This is particularly true now, as cost pressures throughout the P&L persist. “What’s important now is knowing if your business is fundamentally sound; HR, leadership, culture … Does everything have to be perfect? No, this is an imperfect business. But don’t be offended when we dig in. “We want to know that we’re not giving you money to augment an existing problem,” said Andrew K. Smith, managing director of Savory Fund. “Our non-negotiables (for an investment) are unit economics and financials.” That said, Savory Fund is also focused on businesses that have a long-term vision to build something special.
Restaurants Wade in on Both Sides of Israel-Palestine Conflict
Fundraising efforts offered an outlet for solidarity and action. In the second week after a brutal attack on Israel by Hamas and the ongoing violent response in Gaza, there were protests, prayers and solidarity demonstrations across the U.S. Restaurant operators across the country took to social media to express their views and raise money for aid organizations on both sides of the conflict. Unlike the war in Ukraine, chain restaurants have largely remained silent on the outbreak of violence in Israel and Gaza— with the exception of Starbucks. The Seattle-based coffee chain last week expressed sympathy for “those who have been killed, wounded, displaced and impacted following the heinous and unacceptable acts of terror, escalating violence and hate against the innocent in Israel and Gaza.” The chain also countered what it described as misinformation from union groups organizing coffeehouse workers that had reportedly expressed solidarity with Palestine, though the social media posts have since been deleted. Starbucks said the views expressed by a group calling itself Starbucks Workers United and its members “belong to them and them alone.” The conflict has also reportedly divided some McDonald’s franchisees operating in the region, according to Insider. Last week, McDonald’s Israel announced plans to give away free meals to members of the Israeli Defense Forces, while McDonald’s Oman, also known as Al Daud Restaurants LLC, said it donated $100,000 toward relief efforts in Gaza.
Actors Turn to a Familiar Fallback Job
As the strike wears on. In January, Francesca Xuereb took the leap many actors in Los Angeles dream of: She quit her waitressing job. After booking a recurring role in HBO Max’s “The Sex Lives of College Girls” and performing another for a forthcoming show on Peacock, she was meeting with producers and auditioning five or six times a week. “I was getting a lot of traction,” she said. But the concurrent strikes by the Writers Guild of America and Ms. Xuereb’s performers’ union, SAG-AFTRA, put all that on hold. She is now back at her serving job, working four shifts a week at Akasha, a neighborhood farm-to-table restaurant in Culver City. “It definitely felt like slowing down, and that doesn’t necessarily feel good,” she said. “I don’t mind working in the restaurant. My picture of what being an actress would look like is working as a server until I was able to not go back.” The strikes have brought the entertainment business to a standstill. The Writer’s Guild strike, which began in May, ended on Sept. 27, but the SAG-AFTRA strike, which started in July, continues. Writers, actors, set decorators and production coordinators have all slid back into the industry that serves as Hollywood’s shadow partner: restaurants. In Los Angeles it’s a cliché that the ranks of hosts, waiters and bartenders are filled with aspiring comedians, actors and writers. And while the rise of gig work like driving for ride-share companies means that food service is not necessarily the default job for newly arrived dreamers, the strike has supercharged demand for restaurant jobs.
Did You Know?
Five tips for giving employees gifts that will make a difference. The holiday season provides an opportunity for companies to express gratitude and appreciation to their employees and customers. It’s a time to end the year on a positive note, strengthen relationships, and lay the foundation for a promising new year. However, as the saying goes, “It’s the thought that counts.” A poorly chosen gift can have unintended consequences, like leaving employees disappointed. For instance, gifting a vegan employee a certificate to a steakhouse might not be the gesture of goodwill intended—it could even be the final straw that sees them looking for new employment in the coming year. The five tips below will help employers give gifts that receive the intended response, be it increased loyalty, retention or morale.
Employee Tip
Enhancing employee well-being in the food industry. The food industry is infamous for long hours, fast-paced kitchens, and high-strung chefs. Left unchecked, this pressure to perform can undermine the well-being and mental health of folks who work in catering and hospitality. This sentiment is echoed by The Burnt Chef, which found that 84 percent of food industry workers had experienced some form of mental health condition during their careers. Failing to protect the mental health and wellness of employees can have a dire effect on the productivity and well-being of your workers. Folks who feel burnt out are far more likely to call in sick and may jump ship to more people-friendly employers.