Restaurants See Mixed Results as Voters Push Trump Over the Top
The fate of several key ballot initiatives were decided in the industry’s favor. In the end, the expected squeaker of an election proved a decisive victory for hotelier-turned-politician Donald Trump, returning a businessperson to the nation’s highest office and leaving restaurateurs wondering what the selection of a notorious enemy of regulation would mean for the business. The Republican’s victory was assured early this morning when Wisconsin’s 10 electoral votes were awarded to Trump, giving him the 270 he needed to beat Kamala Harris. The ballots of five states have yet to be tallied, but the former president’s triumphant showing in at least four so-called battlegrounds assures him an official win. The preliminary results also show Republicans regaining control of the U.S. Senate. It remains unclear if the GOP held onto its majority in the House of Representatives, but the party was leading by 20 seats. Way before the race was called for Trump, restaurateurs already knew the fate of several ballot initiatives with particular significance for the industry. A ballot proposal to phase out Massachusetts’ tip credit was resoundingly defeated, 64% to 36%. But the public rejected an effort by Arizona’s restaurant industry to preserve the state’s tip credit in perpetuity through a constitutional amendment. Voters killed the measure by a 3 to 1 margin. A comfortable majority of Missouri residents (57.6%) voted to raise the Show Me State’s minimum wage to $15 an hour by 2026. The same proposal also requires employers to offer paid sick leave. Votes on a proposal to raise California’s minimum wage to $18 an hour are still being counted, with the yea’s narrowly outnumbering the nays, 51% to 49% in preliminary tabulations. The rate would have given the nation’s largest restaurant market the highest across-the-board pay floor in the nation, though most of its fast-food workers have been earning at least $20 an hour since April 1. The election caps what has been one of the most fractious and unusual presidential races in U.S. history. Right up to the time polls closed, the outcome was uncertain.
October Job Growth Stagnates Nationally
Including the restaurant industry. Although September was a strong hiring month for restaurants, October job growth has stalled both nationally and for the restaurant industry. According to the U.S. Bureau of Labor Statistics, the national unemployment rate was 4.1% for the second month in a row. It has remained above 4% since May 2024, and has been slowly creeping up past the pre-pandemic unemployment rate of 3.5% over time. In October, the restaurant and bar industries added 3,700 jobs, with the employment rate at 3.7%. According to updated data, the restaurant and bar industries had a seasonally adjusted employment rate that was more than 10 times higher in September, with 39,300 jobs added. This altered data was cut down by nearly half from preliminary reports last month that suggested job growth of nearly 70,000 in September. August job growth was also retroactively adjusted, and together, August and September hiring trends were adjusted downward by nearly 65,000 jobs. September through November is usually a peak hiring season for the foodservice industry as operators gear up for a busy holiday season. It is possible that restaurants will continue to hire more employees in November as peak holiday season approaches. According to Alice Cheng, CEO, and founder of Culinary Agents, the 10% bump in foodservice industry job openings last month was surprising, and this month’s shift might be a return to normal for the restaurant industry, particularly for independent restaurants. “We’re starting to see more normalization in the trends of hiring after seeing an early spike of hiring in late summer and into early fall, which was a bit of an odd thing to see,” Cheng said. “Then, once it reached the October timeframe, which is always the highest peak for fall hiring, historically, it started dipping this year. This is an indication that the industry has normalized, and that [restaurants] are planning better”…
Bielat Santore & Company – Restaurant Industry Alert
BIELAT SANTORE & COMPANY SELLS ANOTHER NJ BAR
It is plausible to say that Bielat Santore & Company, Allenhurst, New Jersey has sold more restaurants and bars in New Jersey than any other real estate company. Add one more to that list. Jersey Girls, a closed bar located on Route 35 in the Lawrence Harbor section of Old Bridge Township has been sold according to Bielat Santore & Company’s sales associate, Bob Gillis…
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Why Sit-Down Chain Restaurants Are Struggling
Chain restaurants used to be pretty stable businesses. Red Lobster filed for bankruptcy in May. TGI Fridays closed nearly 50 locations abruptly in October, then filed for bankruptcy in early November. Hooters shut down dozens of stores in June, while Buca di Beppo declared bankruptcy in August. Even budget standby Denny’s said in October that it would close about 150 stores in the next two years, citing “choppy economic conditions” and the fast pace of inflation for food away from home. Sit-down chain restaurants may be the quintessential American business, beginning with the expansion of Howard Johnson’s after World War II as families got in the car and started to travel. But the economy is challenging the business model. Although inflation is slowing, cost-conscious consumers are eating more at home or at lower-cost fast-food restaurants, where the average check is $7.92, about half the average check at a sit-down restaurant, according to CREST, a database from consumer insight firm Circana. Many sit-down (or full service) chain restaurants came into this economic climate deep in debt, and are now struggling to stay afloat. “A whole lot of these companies are finding their sales aren’t turning out to be as strong as expected,” says Jim Sanderson, a restaurant industry analyst for Northcoast Research. Customer traffic at full-service restaurants in the third quarter of 2024 was down 3% from a year ago and is 17% below the same period in 2019, according to CREST. Part of the problem is labor costs are continuing to grow but inflation-weary consumers aren’t willing to pay more for restaurant food, says Sanderson. Nearly all restaurant owners surveyed by the National Restaurant Association this year said higher labor costs were “an issue” for their business. Restaurants used to spend 30-35% of gross sales on labor. Now many spend 40% to 45%, according to Dave Foss, co-founder of hospitality group Maverick Theory. Another issue is that many of these restaurants are now owned by private-equity groups that borrowed a lot of money for their acquisitions and are not seeing the cash flow they needed to come out even…
Why High-End Restaurants Are Spinning Off
A more casual bar version of themselves. At a recent dinner at Gem Wine on Manhattan’s Lower East Side, my table was filled with raw scallops on crisp cabbage leaves, a griddled lobster-chanterelle sandwich, mackerel slivers on warm toasts, and smashed and fried lion’s-mane schnitzel. The small plates added up to a decent meal—and the kind of hefty bill that I’ve come to expect at a certain kind of beverage-focused not-quite restaurant: Including a dainty quenelle of corn ice cream and a bottle of Savagnin, I dropped close to $400. But a 20-something in a Waffle House hoodie can just as easily leave the restaurant with a $28 tab. According to chef and owner Flynn McGarry, Gem Wine is an “in-between restaurant,” an acquiescence to the current mood for choose-your-own-adventure dining. “Guests have the option to not look at us as a restaurant,” he says. Not too long ago, at the same address, McGarry served 12-course tasting menus priced at $155—that is, before he temporarily closed Gem and transformed it into its current wine-bar iteration. Nearby, Bar Contra occupies real estate that once housed Contra, from Jeremiah Stone and Fabián von Hauske Valtierra, whose $180 tasting menus have been dispensed with in favor of stuffed chicken wings and modernist cocktails from Dave Arnold. In Philadelphia, tasting-menu eatery Laurel is now wine bar Laurel, while Chicago’s Esmé developed an easier-going restaurant-within-a-restaurant, Bar Esmé. In New Orleans, the renovation of Emeril’s came with a sister wine bar. Back in New York, Angie Mar dropped the dress code and added burgers to the bar menu at Le B, formerly known as Les Trois Chevaux. This isn’t to suggest that fine dining is dead—it’s just showing its looser, more relaxed side…
Applebee’s and IHOP to Open First U.S.-Based Dual-Branded Concept
Opening Q1-2025. Dine Brands’ dual-branded Applebee’s/IHOP concept is coming to the U.S. next year. The prototype, which has been showcased internationally, will open in San Antonio suburb Seguin, Texas, during the first quarter. The restaurant will be opened by franchisee R. Hakim Group. “We’re excited to improve dining options in Seguin, Texas, by bringing together two iconic brands,” Danny Hakim said in a statement. “From IHOP’s world-famous pancakes and breakfast offerings to Applebee’s classic American fare and dinner items, guests can enjoy the best of both brands any time of day within one great restaurant experience.” The dual-branded restaurant will replace an Applebee’s that will close for renovation on November 10. All team members have been offered positions at nearby locations during the closure. “We’re eager to kick off development and bring the first dual-branded restaurant to the U.S. in Seguin, Texas. With two brands under one roof, it allows IHOP to shine in the morning and Applebee’s to thrive in afternoons and evenings,” Dine Brands CEO John Peyton said in a statement. “The menu leverages each brand’s unique offerings to maximize dayparts and provide more choices, variety, and value to guests.” According to the rendering, the prototype will apparently have an Applebee’s drive-up window, a format the chain has tested in recent years. The chain’s off-premises sales mixed 21.7 percent in Q3 compared to 21.5 percent a year go. There are 15 sites in the U.S. approved for additional dual-branded growth. Peyton told investors during its Q2 earnings call in August that it wasn’t prepared to reveal actual building costs because that was “part of our test and learning process in partnership with a couple of franchisees.” Dine Brands also revealed in Q2 that it opened two dual-branded units in Saudi Arabia and Kuwait, after already opening a handful in the Middle East. There are locations in Canada and Mexico too. Peyton said these locations average roughly twice the revenue of a standalone IHOP or Applebee’s restaurant of the same size…
What Can Growing Businesses Learn from Enterprise Restaurant Loyalty Programs?
How to add a personal (and community) touch. Loyalty programs are the secret sauce for keeping customers hooked, whether you’re a cozy corner café or a massive restaurant chain. It’s not just about making customers come back — loyalty programs boost revenue, offer valuable insights about your diners, and give you that extra edge in today’s super-competitive market. In a world where third-party delivery apps dominate, securing customer loyalty through personalized rewards and direct communication is the equivalent of having the best table in a packed restaurant. But in a sea of choices, how do you make sure your diners keep coming back? For starters, technology plays a big role: more than 60 percent of diners credit tech with making their restaurant experience better. Restaurants are going digital, with innovations like contactless ordering, reservation apps, and personalized marketing driven by data. It’s a new era of dining, where your favorite spot knows not only your name but also your order. But it’s not just about convenience. Integrating tech with loyalty programs creates that “loyalty loop”—an endless cycle of guests coming back for more, while restaurants gain valuable data to offer personalized rewards. Whether you’re a mom-and-pop diner or a fancy spot downtown, a good loyalty program keeps things fresh, and those repeat visits rolling in. Smaller businesses have the home-field advantage of being able to build closer, more personal relationships with their customers. Here are some tips for growing businesses looking to launch loyalty programs that’ll not only keep customers coming back but also make them feel like part of the family…
Wendy’s to Close 140 Restaurants
By the end of the year. Fast-food giant Wendy’s is shuttering 140 underperforming locations through the end of 2024 as it looks to improve its “restaurant footprint and overall system health.” To counter the closures, though, the Ohio-based company is working to replace many of these units with “new restaurants at better locations with significantly improved sales and profitability,” Wendy’s CEO Kirk Tanner told analysts on its third-quarter earnings call. The company thoroughly reviewed individual restaurants to ensure they meet sales expectations and are profitable enough to support growth, and said that the locations closing are “outdated and in underperforming areas,” with operating margins far below the system average, Tanner said. “I think when you think about strengthening our system, you look at a brand that’s 55 years old and some of those restaurants are just out of date,” Tanner said. This restaurant footprint optimization is part of a slate of initiatives Wendy’s is deploying to strengthen the brand and its operations across the company and its franchisees. The company didn’t disclose where the closures will be, but Tanner noted that “it’s not one particular area.” Wendy’s anticipates the total closures in 2024 to be “offset by new restaurant openings this year, leaving our net unit growth approximately flat compared to the prior year,” Tanner said, adding that the company is confident that it will achieve significant accelerated unit growth rate of 3% to 4% in 2025. By the end of 2024, the company said it will have opened more than 500 new restaurants over the last two years. Tanner said it is also “using data-driven insights to target high-growth trade areas” as it continues to open up new locations. Globally, the company said it’s on track to reach 250 to 300 openings for the full year. Wendy’s is among a growing number of chains that have been trying to lure customers back in through a slew of promotions…
Did You Know?
Hiring? Ask These Interview Questions. Seamless restaurant operations, where the crew anticipates customers’ and coworkers’ needs and easily course-corrects, require more than technical know-how and vetted organizational systems. Instead, these smooth interactions are more likely attributable to soft skills like problem-solving and empathy that allow teams to work together and deliver exceptional service, turning one-time customers into lifelong fans. Still, finding candidates who embody these traits remains a perennial challenge—and nearly impossible if you’ve been asking the wrong questions. Hiring for soft skills becomes much simpler when you know exactly what to ask and look for in interviews. In this article, I’ll share those tips so you can hire people who will excel in the role and not only fill it…
Employee Tip
Moving beyond hourly wages toward supporting employees as whole individuals. Staffing and retention is often cited as a main pain point by restaurant operators. So what can they do to compete for talent, hire effectively and retain staff in the long-term? One industry insiders says pay increases are just part of the package as operators are increasingly leveraging benefits to differentiate themselves. “Our compensation data indicates a shift towards more comprehensive benefits and total compensation packages, moving beyond traditional hourly wages and annual salaries,” Alice Cheng, CEO and founder of Culinary Agents, told Modern Restaurant Management (MRM) magazine. “This trend emphasizes the importance of supporting employees as whole individuals in today’s competitive job market”…
