March 9, 2023
It’s a Frontline Look at Restaurant Chain Challenges of Today
Creative Energy helped organize a gathering of chain restaurant operators in Orlando recently on behalf of our client, Johnsonville®. The event was part of the Nation’s Restaurant News CREATE series of events with Senior Food Editor Bret Thorn. The opportunity to hear the latest challenges facing restaurant chain operators was an eye-opener, with some possible solutions for addressing some of the biggest hurdles.
I won’t share the names of those with specific comments from the 13 participating chains during a panel discussion and breakout sessions. But I can offer some highlights of those in the trenches of key topics, such as supply chain, labor, and customer experience. I will share some important takeaways.
The Labor Challenge
It remains the most daunting challenge in the post-pandemic era. Operators agreed that today’s workers are more temperamental and willing to go to another restaurant for 50¢ or a dollar an hour more. One of the biggest problems is the attendance of staff who’ll skip a shift on a whim, or clock out the second their shift ends, leaving the next shift to fend for themselves in figuring out orders to tables. New regulations in some states no longer allow them to ask for a doctor’s statement for those calling in sick.
Some operators are adding a 20% service charge to orders versus tips to encourage wait staff to upsell customers. The better the upsell, the more they make. Others have layered in career-oriented benefits, including 401k, health insurance, and earned vacation time.
The days of substituted products due to shortages are ending in 2023. As primary suppliers return to reliable supply, operators are switching back to specified products from manufacturers. Yet, all maintain contact with alternate suppliers just in case.
There is a general dissatisfaction with broadliners who continue to leave them in a lurch with unfilled orders when trucks deliver without a heads up so that they can backfill those orders from alternate sources.
The Good News
Menus are beginning to return to normal after being hacked during COVID. One operator recently brought back steak to his menu after 18 months of serving burgers instead. Another added 17 new menu items while removing 12 for a net gain. Several have recently added bowls to their menu made up of inexpensive rice, beans, and proteins already in their kitchen to much success. For several, pimiento cheese and potato tots were surefire winners. Manufacturers should share multiple ways their products can be served on a menu, as a center of the plate, appetizer, side, etc.
While the major effort is in creating a unique experience for dine-in customers, the topic of takeout and delivery remains. The transportability of food items remains a priority in determining what will be on a menu. Most of the dine-in discussions revolved around providing live entertainment for full-service operators, which included unique visuals, décor, and service amenities. New restaurant construction is downsizing table areas while maintaining their kitchen space to provide capacity for takeout and delivery.
A battle with third-party delivery services is raging with operators now offering discounts on deliveries that come through their chain’s mobile ordering system instead of a third party’s.
How You Can Win
Share opportunities for how your brand can add value to both the entertainment and delight of takeout and delivery customers. For brands, such as Johnsonville, whose notoriety is the #1 retail sausage, its position as a sponsor of SEC football, and the leading sponsor of the American Cornhole League, offers some quick ideas on adding value to a chain’s dining experience.
While there is a glimmer of recovery from all who attended the event, daunting challenges remain through 2023 and beyond. Taking some notes from those in the trenches of the recovery offers some real-world realities that food manufacturers can use to grow their sales.
It’s a good example of how Creative Energy brand executives gain insight into advising our clients. We’re consistently engaged in the food business to grow our insights into our niche as a leading food agency. If you would like to discuss your own opportunities, we’re happy to listen. One last tip. We chose an exceptional venue for this event, Emeril Lagasse Foundation’s Kitchen House & Culinary Garden. If you are in search of a culinary event like none other with an organization out to educate consumers on food, consider this location. The staff was superb, and the event space is perfect for such a gathering.