Restaurant recovery among the service industry seems to be just ‘round the corner- predicting about another year to 18 months of challenges. According to the National Restaurant Association, and originally referenced in a CNBC article, the food service industry is projected to reach $898 billion in sales this year, up from $799 billion in 2021 and surpassing pre-pandemic sales levels from 2019 of $864 billion, seemingly leading to a major restaurant recovery across the board. When taking into account rising inflation in 2022, data anticipates that sales will still remain below pre-pandemic levels, but with vast improvement as conditions begin to normalize. Although any gains had originally been associated with the increasing prices during this time, it does seem like restaurant recovery is not just something to hope for, but something that is officially starting to rebound!
The hospitality and restaurant industries have definitely been heavily impacted by rising labor and food costs as restaurant owners continue adapting their business operations and navigate through a third year of an ongoing pandemic. Not every restaurant has survived or will be able to reach full recovery, but there does seem to be light at the end of the tunnel for many. From fast food, family service to fine dining, and with months of uncertainty behind them, restaurant recovery is upon us! Here’s how:
Overcoming Challenges Leading To Restaurant Recovery
Most restaurant owners and operators have been dramatically affected by labor struggles and inflation of food costs. Profits are down due to supply delays and shortages of key food and beverage items also in high demand creating cost increases. During the restaurant recovery phase, many operators are trying extremely hard to not raise those menu prices. However, they are still in need of more productivity and efficiency in the restaurant operating environment.
In terms of modification, many restaurants are taking the “do more with less” approach. This means streamlining menus without adding new ingredients. Chefs are cooking to infuse current dishes with new flavors and creating combined mashups to drive business yet still intrigue customers. Restaurant operators are looking at their own data to discover which menu items really help to drive revenue and work best for takeout and delivery options to ensure growth. This will also help with the preparation of ingredients so suppliers can work tirelessly on expo floors to showcase their shortcuts and ways they can help assist in the restaurant recovery process.
Although we cannot deny the labor shortage, from servers to cooks, and other restaurant workers to agriculture and the meatpacking production workforce, many restaurants were forced to run on shorter hours and fewer days. This also played a huge role in menu modifications.
Menu Reboot: Where to Begin with Restaurant Recovery
From a culinary standpoint, having a variety of offerings is key while still keeping the focus on specialty items and “FARM”, which stands for fresh, authentic, real and minimally processed, as a mantra to follow in product development. Research shows that this is the current direction and tendency from the customer’s perspective when they are dining out. They do not want to order things that they can easily make themselves, at home in their own kitchen. They want to get something extra crafted if they are going to endure these high costs for entertainment and dining pleasure.
Trending Onward & Upward
As we continue to overcome the aftermath of the most challenging pandemic in generations, the trending movements in the restaurant industry seem to be here to say. The most effective and positive progressional is how restaurants define adaptability. Restaurants of all sizes embraced elements of technology, with the use of third-party apps, direct online ordering, and finally fully exploiting its use to the fullest extent. Technology will be a key factor in the restaurant recovery stage which we are now entering.
During restaurant recovery, owners are relying on the latest trends, innovations and technology to help them stay afloat and keep costs down to maintain profit margins. This includes contactless transactions and delivery, designing new outdoor dining, alcohol-to-go options, and QR code ordering all to boost their average daily sales. Leaning on these types of marketing tactics helps the industry to still achieve higher proportions thru off-premise dining options. Many operators have big plans to keep these tools implemented while adding more investments to the business in the upcoming year.
Additional Benefits During Restaurant Recovery
Since so many industries were greatly imposed upon by government restrictions and lockdowns for an extended period of time, it is understandable that the restaurant business as a whole faced such a significant setback as they simply could not operate as normal. The National Restaurant Association and Small Business Administration are urging Congress to replenish funds through relief grants for this reason. With so many applications still pending to be put through various programs, restaurant recovery, although happening slower than most would like, it’s still very much rebounding.
Restaurant recovery will contribute tremendously to our country’s economy. As the restaurant industry continues to recover from their losses of the last two years, it does seem like restaurant sales are trending upwards in a positive direction! Most restaurateurs are looking now that over the next 12 months, we will see the cycle bounce back as a turnaround year.
Restaurant Recovery Remains Resilient
The first quarter of 2022 truly has proved that technology became a crucial solution when it came to addressing certain issues during the pandemic- so many technological advantages is what allowed many restaurants to stay open. Restaurant recovery will still need to beat the challenges of inflation, supply chain issues, and labor incentives, but one thing is for sure, restaurant recovery demonstrates nothing less than resiliency.