Many restaurant brands tend to look to millennials for hints of where foodservice trends may be heading, particularly when it comes to off-premise sales. But some recent research completed on behalf of the National Restaurant Association demonstrates that baby boomers are showing traits that operators would be wise to watch when it comes to offering food for take-out and delivery. Research conducted for the association found that 51 percent of boomers, which it defined as consumers between the ages of 55 and 73, say they aren’t ordering takeout and delivery as often as they would like. In comparison, 43 percent of millennials, consumers aged 21 to 38, shared that feeling. The data found that millennials are just about as eager to eat at a restaurant as they are to eat restaurant meals off-premise, while baby boomers are less likely to want to eat at restaurants more often – only 38 percent expressed that preference. If you’d like to fine-tune your efforts to market to boomers, consider several tactics: Provide a fair price and promote the value of your menu, since a majority of boomers will choose a restaurant based on its perceived value. Expand your breakfast menu options. Offer healthy menu choices with quality ingredients and make healthier items readily identifiable on your menu. Create new twists on classic dishes. Experiment with ethnic spices and dishes with bold flavors. Finally, when it comes to technology, offer tech-driven, mobile-friendly ordering functionality and loyalty programs that make it easy to not only place off-premise orders but also to reap rewards for continuing to order with you.
Your guests may well want you to compost your food waste – but what if you don’t have the local infrastructure in place to support it? Snooze, a regional breakfast, brunch and lunch brand, has made it a priority to use technology to make composting possible regardless of where its restaurants are located. Where composting isn’t available, Snooze equips its restaurants with biodigestors – mechanical stomachs that use bacteria to decompose food waste into water that can be washed down the drain, along with a small amount of material that can be used as an organic fertilizer, Restaurant Business reports. At the recent New York City Restaurant Technology Summit, Snooze CFO Bill Long spoke about the brand’s efforts, which also include identifying “green captains,” who are employees paid to spend between three and 10 hours each week educating coworkers about sustainability and how to promote it.
Across industries in the U.S., labor productivity has effectively doubled over the past 30 years, according to recent data from the Bureau of Labor Statistics. However, the foodservice industry has been among the slowest to grow, at about 80 percent below the national average and ranking just below the post office and just above the mining industry in productivity. The food and beverage strategy firm Aaron Allen & Associates points to one culprit holding the industry’s productivity back: restaurants’ slow adoption of new technologies. The company says the next five years will be more disruptive to foodservice operators than the past 50 years have been, and slow adopters of technology are likely to be left behind. Specifically, technology is making the restaurant experience more and more frictionless for customers and operators alike: Once a consumer gets used to ordering his favorite take-away meal with merely a couple of taps on his phone, then automatically earning loyalty points redeemable for this item at the times of the week when he craves it most, he won’t want to give up that experience. Similarly, once an operator is using tech to monitor everything from the most popular menu items to the functionality of appliances, she has time to focus on providing better customer service, connecting with staff or even scaling up the business. While these updates can be difficult to transition to for an older operation used to managing business more conventionally, restaurant startups are launching with this technology already embedded into their business models ― and it’s giving them a clear advantage when competing with more established brands.
Food packaging technology is evolving so fast that it’s making plastic cutlery seem almost quaint. A startup called Planeteer LLC, for example, has taken on the challenge of packaging waste and developed a variety of cutlery that isn’t merely compostable but also edible. The company has created a spoon that it promises will hold its shape for 25 minutes in hot soup and 50 minutes in a cold dessert, The Spoon reports. Planeteer cofounder Dinesh Tadepalli said it is vegan, all-natural, rich in protein and composts in days if not consumed. The company will be presenting its product at the Smart Kitchen Summit’s Future Food Competition in October.
Months after chefs and food industry analysts alike identified cannabidiol (CBD) products as top food and beverage trends of 2019, the CBD industry continues to, shall we say, fly high. In a recent survey of 2,000 U.S. adults conducted by a market research firm focused on the cannabis market, 1,500 respondents said they had used CBD products in the previous three months. The survey also found that 40 percent of consumers aged 21 and older would try CBD products. Consumer interest in the products has driven restaurant operators to provide them – but considering CBD has still not been approved by the FDA and is readily associated with marijuana (despite lacking its psychoactive effects), it has put operators in a tough position. Local health departments in New York, California and other states have begun cracking down on restaurants serving CBD foods and beverages – this despite the passage of the farm bill in December making most applications of CBD legal at the federal level. While many restaurant operators offering CBD products have taken the “ask for forgiveness later” approach with health regulators, the risks may outweigh the benefits. A New York Post report said that restaurants violating the CBD ban could be fined up to $650. In Los Angeles, the Atlantic reports, the county health department said it would start docking points on restaurant inspections this past July. If you’re thinking of including CBD products on your menu, make sure you understand the implications. In the meantime, it may make sense to keep the CBD recipes in mind (but perhaps off the menu) and keep close tabs on regulations as they evolve.
This fall, a sweeping bill is likely going to be introduced in Congress that will ban many single-use plastics, set recycling targets and require deposits for beverage containers, the National Restaurant Association reports. In response to the legislation, the association’s food and sustainability director has emphasized the lack of existing national infrastructure to support such a ban – and the stress that could cause businesses forced to comply. Regardless of whether the legislation passes, the global climate activism on display in recent weeks is a sign that the issue of how restaurants manage their packaging waste (and the need for restaurants to understand new packaging technologies) isn’t going away. If you’re looking for ways to improve your practices, the Food Packaging Institute is working with its members, foodservice operators and other entities to share packaging options and has also developed a strategic sourcing guide to help restaurants identify new suppliers.
At Winsight’s September FSTEC conference, where restaurant operators gathered to hear about up-and-coming developments in technology, voice recognition showed special potential as a tech tool to watch – particularly for its back-of-house functions. Consumers are becoming more comfortable with voice recognition as an everyday convenience – emarketer predicts that more than one-third of the U.S. population will use a voice assistant monthly this year, up 9.5 percent from 2018. That has paved the way for voice recognition becoming more common as a means of enabling consumers to place orders more efficiently from home and on the road (note McDonald’s new purchase of Apprente, a startup building technology to automate voice ordering in multiple languages, which McDonald’s could implement in its drive thru, mobile and kiosk ordering). Voice recognition’s applications beyond ordering have been slower to develop, but that is now changing, according to Restaurant Business. Presenters at FSTEC identified such uses of voice recognition technology as providing food preparation instructions for kitchen staff who aren’t able to leave their stations to look at a recipe or search for directions on a computer screen. Chowly CEO Sterling Douglass said while there is still a long way for restaurants to go when using voice recognition at the back of the house for this purpose, those that are using it with human backup are already seeing 50 percent reductions in cost. For operators looking for additional ways to operate with smaller teams or otherwise cut labor costs, voice recognition could be an additional tool in their toolbox.
The ownership of consumer data has long been a stumbling block for operators considering the hiring of third-party delivery providers, but increasingly, competition in the industry is making it possible for restaurant brands to cherry-pick the options they want from providers. There are several recent cases in point: GrubHub won Shake Shack’s business nationwide by offering to share customer data. Panera has made it possible for customers to place orders via Uber Eats, DoorDash or GrubHub and then have food delivered by its in-house team. Most recently, Chowly did just the opposite. The company said its system now allows restaurant operators to accept orders through its website or app, then farm them out for delivery via DoorDash. It’s an additional sign that for brands eager to make food delivery work, there may be wiggle room when negotiating contracts with vendors.
Restaurant owners are stepping up to the challenge of minimizing their food waste. That was one conclusion of Toast’s recently released Restaurant Success in 2019 Industry Report, which surveyed 1,253 restaurant owners, operators and staff, along with a similar number of restaurant guests, about the experience of operating and dining at restaurants. Toast asked restaurant professionals to share how they’re reducing food waste in 2019. The responses included such actions as using leftover ingredients from one recipe in another (38 percent), offering multiple portion choices for guests (26 percent) and composting (25 percent). Others said they limit the number of items they prepare for service, offer an a la carte menu and cross-utilize ingredients in an effort to reduce food waste. Still, there is room for improvement as a considerable portion of those surveyed (26 percent) do nothing at all to reduce food waste at their business. The consequences aren’t just environmental but also financial: A reFED study found that the approximately 11 million tons of food waste generated by restaurants annually costs businesses about $25 billion per year – and that every dollar invested in food-waste reduction can save restaurants $8. The industry report emphasized that while you can’t control what someone eats or leaves behind, you can control your inventory. Your first course of action in managing waste is to keep close tabs on your shelves to reduce spoilage and avoid a tendency to over-order items – your inventory management system can help you take the best action.
If you’ve ever experienced the disappointment of ordering French fries or a salad for delivery only to receive them in limp, soggy form once they’ve been packaged and transported to you, Bill Birgen feels your pain. A popular speaker at last year’s Smart Kitchen Summit and winner of the SKS Startup Showcase, Birgin has developed technology designed to manage the condensation that can collect in delivery packaging and make certain foods unpalatable as a result. The goal of the packaging, dubbed the SAVR-pak, is to both improve food quality and reduce food waste. While it’s still early, the Spoon reports that the SAVR-pak has gotten the attention of Deliveroo, who has placed a purchase order, as well as a number of resorts.
Yale University’s produce purchases have increased by more than 68,000 lbs. since last year, according to a recent report in Produce Business. That’s roughly equivalent to the weight of 10 elephants. Like many foodservice operators around the country, Yale Hospitality, which the report says serves more than three million meals annually, has been experiencing a surge in demand for plant-based foods well beyond the salad bar. The demand has heightened the importance of having produce suppliers you can trust, since an operation’s food safety is only as good as the food safety practices of suppliers. The produce distributor FreshPoint advises operators to check for verification audits confirming the supplier has passed safety inspections (GAP) and sells food that is protected against accidental contaminants on the part of the vendor (GMP). Beyond that, look for a food defense program that protects against intentional contamination of the food supply, as well as Global Food Safety Initiative certification to demonstrate it is subject to third-party audits. To make sure food is handled safely before it reaches you and stored at the proper temperature before and during delivery, check for an ongoing food safety program for employees and up-to-date refrigerated warehouses and delivery vehicles. Finally, if a recall occurs, what process do they have in place to trace the problem and report it to you? You need to feel confident that if a food safety incident occurs, you will know about it immediately.
Much like how once-ubiquitous plastic grocery bags are now becoming obsolete, could food delivery packaging be following suit? There are signs pointing in that direction. The global food delivery company Deliveroo is partnering with the environmental group RETURNR to enable its customers in Australia to order their delivered food in reusable containers, according to a report in The Food People. For a $6 fee, customers can receive their food in a reusable stainless-steel container that can be returned to participating locations for a refund.
“I’d have a tough time sleeping at night if I was handing our food to an untrained, random third-party driver to then carry that over to our customer, because what happens when you have a service failure or you have a product quality problem in that situation?” That’s what Domino’s CEO Ritch Allison said during an April 2019 earnings call. Of course, Domino’s has the scale to be able to manage delivery orders in-house (and also a vested interest in making consumers doubt the reliability of third-party delivery providers). But if you’re using third-party providers, it’s worthwhile to note – and attempt to manage – their shortcomings, since consumers are more likely to blame the restaurant for service failures than the delivery provider. A recent nationwide survey of 1,000 consumers by Steritech asked questions about the pluses and minuses of delivery and offered suggestions on how to address challenges. When the surveyed consumers have had problems with delivery, they included such challenges as the food taking too long to arrive, the packaging not keeping the food at the proper temperature/containing spills/preventing tampering, and order inaccuracy. Steritech advises taking a range of actions to help: To better resolve service issues, consider printing phone numbers for problem resolution on receipts, packaging or seals – or create an online portal for resolving disputes. Minimize phone orders in favor of online orders for better accuracy. Prioritize order accuracy and quality checks before food leaves your restaurant. Provide real-time delivery tracking or time estimates and send text alerts when food is en route. Offer online tipping options. Communicate your fee breakdown clearly so consumers understand where their money is going. Finally, it’s worth mentioning that some brands are trying to provide the best of both worlds: Panera, for one, is offering a hybrid system whereby it relies on third-party providers to take orders but then uses its own fleet for delivery to better manage quality control.
Chances are your waste management practices have evolved in recent years, whether you are finding new uses for vegetable stems and roots, donating unused ingredients or integrating other practices altogether. As Shannon Bergstrom, a sustainability operations manager at the tech-driven waste and recycling company RTS, told the Rail, new methods for reducing and rerouting food waste are appearing all the time. Coffee grounds are being used to create such items as ceramics as well as logs that can be used as fire wood. Spent grains left over from beer production are being remolded into all-natural dog treats. Even if you can’t go to those lengths to find uses for your food waste, you likely can make better use of technology to improve your practices. RTS, for one, helps foodservice operators use technology to access on-demand collection services that can help businesses connect to a wide range of vendors looking for anything from raw ingredients to cooked meals. It may help you find uses for leftover ingredients that you’re not even aware of.
If you serve avocado on your menu, you’re well aware of the rollercoaster ride it has been taking lately with regard to supply and demand. According to a USA Today report, the price of avocados in early July had skyrocketed 129 percent since the same period during the previous year. While restaurants are making adjustments such as diversifying suppliers, raising prices and finding substitutes for the beloved avocado where possible, these are steps that should be taken not just when one key ingredient is in short supply but across the spectrum of a restaurant’s inventory year round. When you monitor your inventory more closely – even in times of plenty – you can more easily ride out times of scarcity. MarketMan suggests you take such steps as tracking food costs throughout the year so you’re more able to spot seasonal fluctuations in price, as well as what you have paid historically. (Team Four can help you with this.) Where possible, fill your menu with seasonal produce to minimize costs – it will also encourage guests to visit you while a favorite item is still available or when a new one is about to be featured on the menu. Partner with your chef to make sure he or she is able to use what’s in season and can minimize costly extras. When it comes to suppliers, try to lock in prices for the long term and don’t hesitate to shop around for better deals when it’s time to renew your contracts. Look around for deals online, particularly for non-perishable items that can be purchased in bulk. Monitor your spending regularly using software with purchasing and ordering management features that can help you stay on top of price fluctuations.
If the restaurant tech landscape doesn’t quite working for your business yet, just wait five minutes and you’re likely to find technology that does. One possible example is the recent partnership of Waitbusters and Postmates. Waitbusters started out as a tech company aiming at eliminating wait times at restaurants but it is now evolving in an effort to work with restaurants that don’t want to hire delivery drivers and also don’t want to pay the high fees charged by many third-party delivery providers. It has integrated its Digital Diner software platform with Postmates and allows operators to turn on the Postmates delivery function when they need it and turn it off when they don’t. This helps eliminate the costs of using an entire third-party delivery platform while giving operators access to off-premise options they may need.
Across the restaurant industry right now, profits range from 0 to 15 percent, according to Toast, and profits between 3 and 5 percent are most common. That doesn’t leave much wiggle room for making errors or adapting to industry changes such as the rising demand for off-premise dining. Operators have to be continuously creative when it comes to finding and mining sources of revenue, whether from new products, services or partnerships. (Note the current fervor around restaurant brands partnering with Beyond Meat, with Subway and Hardee’s being just two of the latest companies to tap into the meat substitute’s popularity.) Restaurant Nuts suggests operators consider options such as joint ventures – for example, partnerships with grocery stores to sell your products can help you promote a special offering while lowering your sales and marketing expenses. Or, as All Food Business suggests, you can partner with a corporation to offer expense accounts, business dinners, client programs or events that can generate income. You can align with a business or charity whose mission complements yours if it helps you to expand your audience, offer a special event you wouldn’t be able to offer on your own, or tap into resources (such as technology or delivery capabilities) that benefit both parties. Within your business, building out a catering menu can help you make the most of your food costs (and minimize waste) while serving lucrative off-premise and corporate customers. Depending on your business, there may also be opportunity to offer retail products like clothing or take-home versions of signature sauces that your restaurant is known for.
Want to win over customers? It’s not about having mouth-watering new specials or transforming your marketing strategy. It’s all about your operations. (At least that seems to be the trend based on recent performance results of a number of major brands.) As reported in Restaurant Business, brands including Dunkin’, McDonald’s, Starbucks and Wendy’s have prioritized operational changes over menu innovation in recent months. Wendy’s has focused on eliminating tasks and training employees to improve speed of service. McDonald’s continues to experiment with automation and has held competitions to find ways to serve guests faster. Dunkin’ has streamlined its menu and changed the layout of stores to improve flow of operations. As for Starbucks, third-quarter same-store sales increased 7 percent and store traffic increased 3 percent, due to what the company says is its focus on simplification – reducing the tasks that need to be completed in-house and shifting employees’ focus to guests. How can you simplify your operation – both with and without technology – to deliver better service?
If you feel like the rising costs of ingredients, labor and transport give you no choice but to raise prices at your restaurant, you might take comfort in knowing that across the country, brands are following through and raising prices -- and customers (so far) aren’t blinking. As the Wall Street Journal reported recently, Chipotle, which raised prices last year, experienced a 10 percent rise in sales largely as a result of bigger orders. Mondelez and McDonald’s have been experiencing similar results after boosting prices. While talk of a recession looms, U.S. consumer confidence is still at near-record highs since the recession, according to the Conference Board. If you need to raise prices in the coming months, find ways to make consumers feel it’s worth their while to pay you a visit. Link your price increases to discounts and other promotions, particularly for your most loyal guests. As Psychology Today reports, those deals tend lead to greater overall spending – an item regularly sold at a stable, discounted price will seem more valuable and worthwhile when the price is raised and a generous coupon is offered to offset it. Be strategic about the promotions you offer. As Toast advises, for a promotion to be most successful for your business, you should take time to understand your target customers and tailor promotions to what motivates them; address the business operational challenges you face (and which your point-of-sale system – not your gut -- will best help you identify); tap into local media, which can broaden awareness and interest well beyond the time frame of your promotion; and know your margins so you can bundle items that will lead guests to try higher-margin items on your menu (i.e. offering free fries with every milkshake purchase is better than simply giving away fries).
Long a trend setter in the delivery space, Domino’s is now going national with its use of e-bikes to boost delivery efficiency, according to a QSR Magazine report. The brand, which announced a partnership with e-bike company Rad Power Bikes recently, had been testing electric bikes in markets including Miami, New York and Houston and saw improvements in delivery and service as a result. As third-party aggregators vie for restaurant delivery customers, Domino’s has sustained its use of an in-house delivery team. While that can be a financially beneficial move for a large brand, the introduction of delivery via the Rad Power e-bikes, which have integrated motors that assist with pedaling up to speeds of 20 miles per hour, may enhance that efficiency further. Domino’s reports that there have been labor benefits from being able to hire candidates who don’t have a driver’s license but can use a bike, as well as team satisfaction benefits from workers who had been delivering via bike and can now get an extra boost when pedaling up hills with the help of a motor.
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