Future-Proofing Restaurants
What to expect in 2026. As restaurant operators prepare for 2026, they face ongoing challenges including labor shortages, increasing costs, evolving consumer expectations, and the accelerating pace of technology. At the same time, casual dining is experiencing a resurgence, value-driven diners want both good price and great experience, and automation is becoming a necessity rather than a novelty. Future success will depend on how well operators balance these pressures with new growth opportunities. To help operators navigate the road ahead, Modern Restaurant Management (MRM) magazine reached out to Cristin O’Hara, Managing Director and Restaurant Group Head at Bank of America, to discuss strategies for addressing price fatigue, holiday prep, leveraging AI and automation, bolstering fraud prevention, and adapting to this evolving dining landscape. What are some robust strategies operators can implement to improve their day-to-day business that address labor challenges, control costs and set them on a profitable path? While employee turnover is a usual issue for operators, it is not insurmountable and is certainly less of an issue than in the post-COVID days. To combat turnover, some operators have considered offering benefits such as retirement savings programs, tuition reimbursement, and flexible wellness options to entice talent. Operators can consider investing in upgraded systems and automated processes to reduce their reliance on manual labor. For example, self-service kiosks and automated drive-through interfaces can lessen dependence on front-of-house staff. We are seeing that operators are focused on delivering value and experience to diners. By regularly reviewing pricing and promotions, operators can better meet the needs of these value-driven consumers. Casual dining is proving that restaurants in different segments continue to be resilient depending on economic trends, circumstances, and strategies. Currently, they are enjoying a resurgence as consumers are seeking value, quality, and good social interactions. As we head into the holiday rush, what are some things operators can do to meet the needs of diners who want an experience but are still seeking value? Operators are constantly evaluating and adjusting their menu options. This, along with promotional deals, limited-time items, and loyalty incentives, can create urgency and encourage repeat visits. By striking the right balance between quality dining experiences and value offerings, operators can win customers and strengthen revenue…
The Great Restaurant Reset
How economic uncertainty redefined the rules for success. Rising prices have created a “Great Restaurant Reset.” It’s anyone’s game to win as a combo deal at a sit-down casual chain or a pizza at a fast casual joint costs the same as combo meals for one at quick-serve restaurants. In fact, InMarket’s Q2 QSR InSights report found that 66 percent of casual-dining customers also visited a QSR and 25 percent also visited a fast-casual chain in Q2. What’s the recipe for success in this Great Restaurant Reset Era? A playbook and tech stack proven to overcome the conditions of uncertain, rapidly changing times. Micro-targeting, value and strategic pricing, real-time tools and a dash of creativity and innovation must be on the marketing menu. Add to that the ability to guarantee outcomes and you have the ultimate value meal for marketers! Here are five opportunities to bring that mouthwatering strategy to life: Setting the Table for High-Growth, Most Valuable Customers. Winning back lapsed, lost and infrequent customers can’t be done just by knowing who they are, even with the most robust first-party data. You have to understand why they left. It’s table stakes to complement first-party insights with an in-depth competitive analysis and, most importantly, an understanding of where else diners are going, how frequently they visit and purchase, what else they’re buying and why lapsed or lost customers switched is critical. If you’re a fast-casual chain whose frequent diners switched to Chipotle for a three-month period when the chain brought back its Honey Chipotle Chicken, consider bringing back a beloved flavor that spiked sales and visits. A QSR that finds that diners who previously brought their families for a weekly treat traded up to Chili’s for its Triple Dipper Special could launch family combos to help win those diners back. These insights can also be the secret sauce for winning over other high-growth segments like the Movable Middle or your Most Valuable Customers, defined as frequent category buyers but not yet loyal to one brand. This robust approach not only helps you better understand your competitive standing and uncover new high-growth target opportunities, but it also informs more targeted and effective marketing strategies. Beefing Up a Tasteful & Effective Value Proposition…
Bielat Santore & Company – Restaurant Industry Alert
NEW FEATURE – TIP OF THE MONTH
THINKING ABOUT RETIREMENT OR SIMPLY READY TO SELL YOUR RESTAURANT?
HERE IS TIP #1 – PREPARING YOUR RESTAURANT BUSINESS AND PROPERTY FOR SALE
Transferring ownership of a restaurant business, including its liquor license and associated real estate, is a multifaceted process that often spans several months to over a year. The primary objective is to maximize the property’s value while ensuring a seamless transaction and minimizing potential risks such as tax liabilities and legal complications. Critical factors to consider include compliance with local regulations regarding liquor license transfers, property zoning laws, and prevailing market conditions. Bielat Santore & Company has over 43 years of experience in brokering and managing restaurant sales. Their extensive network includes real estate attorneys, accountants, appraisers, and financial institutions specializing in hospitality real estate and business transactions. The guide that follows outlines best practices and essential steps to facilitate a successful sale, emphasizing strategic planning, legal compliance, and market analysis to achieve optimal outcomes for all parties involved. This process can increase your sale price by 20-60%.
- Assess Your Goals and Timeline
- When preparing to sell a restaurant or commercial property, it is essential to clearly define your reasons for selling, such as retirement or business transition, and establish specific objectives including target sale price and desired timeline. Initiating preparations 3 to 6 months prior to listing is advisable, as the sale process can extend from 3 to 12 months depending on a range of factors such as market demand, financing conditions, and local or state regulations. Conduct thorough research into current market trends for restaurants and commercial properties within your area, paying close attention to comparable sales (comps) of similar businesses and buildings. Key factors influencing the property’s value include its location, profitability, and prevailing economic conditions. A comprehensive understanding of these elements will facilitate a more accurate valuation and improve the likelihood of a successful sale. Proper planning and market analysis are crucial steps to ensure a smooth transaction and achieve your selling objectives efficiently.
- Value Your Assets
- Request a professional business valuation from a firm that offers comprehensive valuation services tailored to the size and nature of your business. For smaller operations, the Owner’s Cash Flow (OCF) model can be utilized, which involves adjusting net income by adding back paper expenses, owner benefits, one-time expenses, and the like. The adjusted figure is then multiplied by a factor ranging from 2 to 5, depending on market type, to determine the business’s value. For larger enterprises, the EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) model should be employed, providing a more suitable valuation approach for substantial operations. The goal is to deliver accurate and reliable business valuations to support your strategic decision-making and ensure you have a clear understanding of your company’s worth.
- If you have not already done so, consider conducting a real estate property appraisal. It is essential to identify a reputable commercial appraisal firm with extensive experience in the hospitality sector. The ideal company should possess a comprehensive database of comparable sales, particularly for restaurants and similar hospitality properties. Their expertise in evaluating such assets ensures accurate and reliable valuation results, which are crucial for investment decisions, financing, or sale negotiations. Selecting an appraisal company with a proven track record in hospitality real estate can significantly enhance the credibility of the valuation process and provide valuable insights into market trends and property worthiness.
- It is advisable to have an accountant evaluate the potential tax implications associated with your transaction, including considerations such as capital gains taxes. Additionally, exploring strategies like a 1031 exchange can be beneficial, as it allows for the deferral of taxes by reinvesting the proceeds into similar property. This approach can optimize your tax position and enhance investment opportunities while complying with relevant regulations…
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Why Generic Payroll Systems Are Failing Restaurants
What to do about it. It’s 11:30 p.m. on a Saturday night, just after the last of many customers have left, but for many restaurant managers, the real work is just beginning. That means calculating tip pools across multiple shifts, reconciling different pay rates for servers who worked both lunch and dinner roles, and manually entering hours that didn’t sync from the point-of-sale system. Sound familiar? While other industries may be able to get by with generic payroll solutions, restaurants face unique complexities that standard systems simply weren’t designed to handle. The result? Managers consistently face a significant pain point: administrative tasks that take hours to complete instead of minutes. Add in frustrated employees dealing with payroll errors and owners navigating compliance risks, and the result is clear—an industry-wide acceptance of inefficiency that comes with real costs. While all payroll systems handle basic wages and taxes, that’s where the similarities end for restaurants. The hospitality industry operates with intricate labor dynamics that generic systems often overlook as afterthoughts, rather than core features. Consider tip management alone. A single busy night might involve tip pooling across multiple positions, tip credits, and minimum wage variations—all while accurately reporting to the Internal Revenue Service. Beyond tips, consider the complexities of employees working different roles at different pay rates across multiple locations. A server might work lunch at $15 per hour, switch to bartending at $18 per hour, then return to serving at a different rate due to shift differentials. Add in high turnover, varying local labor laws, meal or rest break compliance, and overtime calculations spanning different roles, and you have a payroll puzzle that generic systems may force managers to solve manually, week after week. Julie Nguyen, Chief Operating Officer at Crawfish Cafe, which operates five locations in the Houston area, didn’t discover they were calculating tipped overtime incorrectly with their generic payroll provider until they benefited from the specialized expertise and built-in tools to power a restaurant-focused payroll solution. “I had no idea we were calculating tipped overtime incorrectly until we switched to a restaurant-focused payroll provider,” Nguyen told me in a recent conversation. “It’s a notoriously complex calculation due to the tip credit, and my generic system simply wasn’t doing it right”…
Menus Cozy Up to Cooler Weather
It’s officially Fall. There’s a definite nip in the air in some parts of the country. Restaurants are ready to warm up customers with cozy, comforting food. Sandwich melts, loaded burgers, mac-and-cheese, soups, and fried chicken are showing off new formats and flavors to welcome the season. French onion soup is the inspiration for Shake Shack’s new limited-time menu, starting with the French Onion Soup Burger. The quarter-pound Angus beef patty is topped with Gruyere, caramelized onions, crispy sweet onions, and roasted garlic Parmesan aioli on a toasted potato bun. On the vegetarian side, there’s a French Onion ‘Shroom Burger—a fried portobello filled with melted muenster and cheddar, topped with caramelized onions, and finished with the same aioli and bun. For the indecisive, both can be combined into the French Onion Shack Stack, and all can be sided by Parmesan Garlic Fries and the all-new beer-battered crispy Onion Rings. Fried chicken takes on a new flavor profile at Jollibee. The fast-food concept teamed up with Katseye, a Los Angeles-based girl pop group, to launch Katseye Special Korean BBQ Chicken Sandwich and Fried Chicken. The chain’s signature Fried Chicken is dipped in a sweet and savory soy glaze flavored with Korean chili. For the sandwich, a breaded chicken breast filet is sauced with the same glaze then layered on a brioche bun with cucumber slices, thinly sliced red onion and cilantro. It may seem a little early, but Firehouse Subs is returning the Thanksgiving Turkey Sub as part of its new Thanksgiving Menu. The sub features carved turkey breast, traditional stuffing, cranberry sauce, and mayo on toasted bread. Joining the sandwich this year is Turkey Gravy, a blend of garlic, roasted turkey, and vegetable stock—created for dipping. Five-Cheese Mac & Cheese is back, made with cavatappi noodles mixed with a cheese sauce of American, cheddar and Neufchatel, then topped with a four-cheese blend. And a new Double Chocolate Chip Cookie is available for dessert…
Commonly Missed Hospitality Insurance Limits & Exclusions
The people factor in hospitality risk. Even with comprehensive insurance policies in place, hospitality businesses often face coverage gaps. Many risks go unnoticed due to complex exclusions, underestimated limits, and the unique people-driven nature of the industry. High employee turnover is a persistent challenge. While good behavior supports business growth, negligence, or misconduct—especially from temporary staff or external contractors—can result in major claims. Hotels and restaurants may carry essential coverages like:
- Cyber liability
- Business Interruption (BI)
- Employment Practices Liability Insurance (EPLI)
- Property coverage.
However, having the right type of coverage isn’t the same as having the right amount or understanding the right exclusions. Let’s break down some of the most frequently overlooked issues in hospitality insurance. Certificates of Insurance: A Simple Step That’s Often Missed. Most general liability and property policies cover incidents caused by your employees on your premises. But third-party exposures—common in hospitality—often fall outside this protection. These are typically not covered under your General Liability (GL) policy unless the contractor names your business as an additional insured. GL covers your negligence, but not the mistakes of outside vendors—unless properly documented. Likewise, property insurance covers your property—but not necessarily someone else’s property that you’re temporarily responsible for. If a guest’s belongings are damaged while under your care, this could become a property or crime-related exposure. Always request proof of insurance from vendors and require to be named as additional insured. It’s a no-cost way to protect your business from claims caused by third parties, and keeps your insurance from being the primary payer. Cyber Coverage: Don’t Underestimate Your Data Exposure…
How Restaurants Can Plan for Downturns
Before the pressure hits. We see it every year—the weather gets colder, foot traffic dips, and suddenly operators are surprised by a January cash crunch. But the truth is, you can feel a slowdown long before you ever see it on a P&L. If you’re paying attention, the signals are always there: weekday lunches soften, fine dining guests pull back, midweek reservations dry up while weekends hold steady. We’ve worked with enough restaurants to know that the real damage doesn’t come from the downturn itself—it comes from not being ready for it. That’s why we push every client to think and act ahead. Planning beats reacting. And no tool matters more than a disciplined, rolling 13-week cash forecast. That’s the foundation. If your sales are missing the forecast by 10% two weeks in a row, it’s time to pivot—no debate, no delay. We build these forecasts in close partnership with our clients because the accuracy only works if the input is real-time and trusted. One of our fast-casual clients saw a sharp drop in weekday business when school was back in session. Because the forecast caught it early, they right-sized staffing, adjusted purchasing, and didn’t have to panic. Liquidity protection doesn’t start when you’re in trouble—it starts with good habits when everything’s going well. Pay vendors faster than the terms when you can. Move sales tax to a separate account every week. Pay off credit card balances monthly. These sound small, but they build trust and breathing room. When things tighten, you’ve got relationships and flexibility to lean on. One client had built up a reputation with their broadliner for paying like clockwork at 15-day terms. When things got rocky, they stretched to 30—and the vendor didn’t blink. Because there was already history, communication, and a pattern of follow-through. People always ask us what to do when things tighten. Here’s the core playbook: know your AP aging, guard your book balance, and don’t rely on your bank app to manage cash. A lot of owners log into their bank every morning and think that’s a strategy. It’s not. It’s reaction, and it’s blind. You might look fine on Monday before the weekend deposits hit—or look terrible for no good reason. You need a forecast that looks out, not just a balance that reflects what cleared. You’ve also got to separate muscle from fat in your spending. Muscle is what drives revenue: great employees, clean compliance, trusted vendor relationships, and the little touches that bring guests back. Fat is the spend that can be trimmed or paused—but don’t mistake that for cutting all creativity or joy. There’s a budget line in every operation for discretionary spend, and it’s important. It keeps morale up. It gives managers space to innovate. But you’ve got to manage the percentage, and when the climate changes, that spend needs to adjust without disappearing…
Sushi Is Bigger Than Ever in America
There’s one main reason. Once considered rarefied and exotic in the United States, sushi has become something entirely different in the last five years: convenience food. In 1985, when Molly Ringwald’s character in “The Breakfast Club” pulls out a bento box of sushi at the fictional Shermer High School, the other students are unnerved by this mystifying lunch. In 2025, when lunch period starts at the real Stevenson High School in Lincolnshire, a Chicago suburb similar to the movie’s setting, students race to line up at the sushi bar in the school cafeteria. How did raw fish and seaweed become staples of the American diet? In the ’80s, sushi had mystique. Although it was sold in vending machines and gas stations in Japan, in the United States it was a rarefied food that could be made only from pristine ingredients, by masters who had trained for decades. But as sushi restaurants proliferated between the East and West Coasts, and as infrastructure was built for storing and transporting frozen seafood, American sushi became something else: convenience food. In interviews, sushi chefs, marketers, researchers, and wholesalers all agreed that the Covid pandemic prompted an unexpected, and enormous, spike in the American appetite for sushi. As people tired of home cooking, and of takeout staples like pizza and burritos, sushi at home became popular, whether delivered from Nobu in Beverly Hills, or picked up from a Target in Minneapolis. A spokesman for the Kroger supermarket chain, which has offered sushi since 1991 and claims to be the largest seller in the country, said sales have jumped by 50 percent since 2019, to a million rolls per day. Before the pandemic, to-go sushi was about 6 percent of total business across the 12 Blue Ribbon Sushi restaurants spread across the country from Boston to Los Angeles. Now, according to the co-owner Bruce Bromberg, it’s 30 percent…
Did You Know?
How Restaurants Can Tackle Delivery App Refund Abuse Without Losing Customer Trust. Operators are under pressure to manage rising refund claims—some genuine, others fraudulent—while protecting both margins and guest satisfaction. The surge of third-party delivery apps has reshaped the quick-service restaurant industry. It has created new revenue streams and broadened total reach. However, with convenience comes a deluge of refund requests that push margins to their limits. Even though most are genuine responses to service failures of one type or another, others are deliberate attempts to exploit. Operators, franchisees, and risk teams face notable challenges. Challenges of protecting customer goodwill without opening the door to repeated abuse. Finding this balance is critical. Too much leniency fuels fraud. Overly rigid controls risk alienating customers who have legitimate requests…
Employee Tip
How to Train Staff to Deal with Angry Customers. QSR teams are no strangers to demanding customers, but the scale and intensity of frontline incivility have quietly escalated into a crisis. As many as 99 percent of retail workers say they’ve experienced or witnessed hostile customer interactions on a daily or weekly basis. Even more worrying, more than half report feeling unprepared to handle those situations effectively. This is where a workplace experience problem becomes a staffing risk. Repeated exposure to customer hostility is a key driver of burnout, disengagement, and attrition. In the QSR sector, where turnover rates already exceed 100 percent, every additional source of pressure pushes valuable employees closer to the door. The question is no longer whether you should prepare your teams for incivility; it’s how fast and how well you can do it…
