Tag Archives: recession

Trend alert: restaurants strive to remain relevant amid the recession

I’d like to share a few articles I read this week that address the changing climate of the restaurant industry and changes in the demographics and habits of diners. Each of these pieces touched on a common theme – that restaurants are going to have work harder to be relevant among a changing -and less loyal- demographic; one that is causing the market to become more competitive and more driven than ever by exceptional customer service.

First, a report released this week from the NPD Group ReCount showed the “total number of restaurant locations in the U.S. shrunk during the past year as smaller chains and independents in particular had difficulty weather the economic storm.”

And, coincidentally, a report from Technomic showed that consumers are entertaining at home more often than a year ago. That trend is expected to increase throughout the year.

The Technomic study is a good segue into a Wall Street Journal article that identifies a trend of restaurants opening fewer locations and instead trying harder to improve service. Mystery shopper programs and online surveys abound.

And the last article, from the Orlando Sentinel, shows how dining habits have changed. Older consumers, who represent a large portion of the casual-dining market, have reined in spending as their retirement savings have taken a hit during the recession. Meanwhile, the next generation of diners is less loyal to casual dining and often feel that traditional sit-down restaurants take too long. Moreover, grocery store chains are honing in on restaurants’ territory by offering more pre-packaged and ready-to-eat meals.

It’s easy to see the downside, but what opportunities do these trends present for restaurateurs?

First, as noted in the MediaPost article, it offers an opportunity for restaurants -especially the independent and smaller chains that are struggling the most- to place a greater emphasis on offering box lunches and party platters, complete with off-site preparation.

Second, these trends should tell restaurateurs that there are too many establishments that are almost exactly the same. Operators should be in a mode of constantly improving and reinventing themselves and keeping the concept fresh.

And last, restaurants should place an even greater emphasis on customer service that is second-to-none. I don’t just mean greeting the diners with a “Hi, my name is Kristy and I’ll be your server,” with a side-order of deadpan stare.

What I mean is to provide a customer experience that isn’t artificial and suffocating, but unique and special enough that people will tell their friends about it.

Now more than ever, your success depends on a unique and memorable experience, and depends on taking advantage of new trends and dining styles. Because in THIS economy, if you build it, sometimes they still won’t come.

Good causes prove to be great recession-busters for restaurants

Recent economic turmoil is forcing restaurants to get creative.

The saying, “adapt or perish” is true now more than ever: KFC now offers grilled chicken, Pizza Hut has pasta, and Morton’s Steakhouse has a $5 burger.

But another (warmer, fuzzier) way that restaurateurs are combating the recession is by hosting charity events, where part of the proceeds go to the cause.

Indeed, many charities also have struggled as regular givers are forced to cut back.

That’s why many non-profits are teaming up with local restaurants in a joint effort to raise awareness and fill seats at the same time.

Family-owned restaurant MiSaVi frequently hosts private parties, charity auctions, benefits and even organized a mini class reunion in a creative effort to drum up new business.

Last month in Pasadena, more than two dozen restaurants offered lunch and dinner specials all week, and then donated 10% of the profits to a local homeless shelter.

And last night in Attleboro, Mass., restaurants teamed up with a performing arts group in a charity auction to restore a local theater.

Likewise, a group of friends in Ohio were treated to a VIP chef’s dinner at the Vue Restaurant & Lounge in Hudson, a dinner they purchased at – guess what? – a charity auction.

On June 15, Patrick’s Kitchen & Drinks in Zionsville, Ind., will host an event benefiting the American Cancer Society’s Relay for Life. Complete with live local music, artists, magicians and even a few town big-wigs generous enough to paint themselves purple and bus tables for a good cause, owner Patrick Mullen said the event “hopefully will spill out into the parking lot and down the sidewalk.”

My prediction: Expect to see more events like these in the future – where restaurants not only team up with charities, but but even partner with competing restaurants in mutually profitable ventures.

Maybe alliances are the new black?

Are happy thoughts key to ending recession?

Maybe Peter Pan had it right – maybe thinking happy thoughts is the key to rising up out of the recession.

Reports this week show that consumer mood has given stocks a boost. According to Chain Leader:

The stock market rose for the first time in a week Tuesday as unexpectedly strong data on consumer confidence sparked optimism that spending by Americans could support a hoped-for economic recovery in the second half of the year.

Citing a bunch of numerical data that means absolutely nil to me, the report went onto describe how consumer sentiment is at it’s highest since September, and investors hope resilient consumers will increase spending in time for the back-to-school season in late summer, helping manufacturers and retailers boost their depleted earnings.

Obviously, there is only so much consumer confidence can do to repair the state of the economy. But for restaurant operators, it could be a sign that banks will begin to ease up on lending as the markets rebound.

In a panel discussion at the recent NRA Show in Chicago, Bernie Siegel, founder and chairman of Siegel Financial Group and NRA Show panelist, said the key to staying afloat is to getting banks to start lending again.

He advised operators to seek financing from smaller, regional banks, as opposed to those with more than three branches.

In addition, the SBA offers a number of online courses aimed at helping small business owners obtain financing and develop a business plan. The SBA announced recently it will guarantee up to 90% of a loan submitted under several of the administration’s small business programs.

And, let’s not forget Obama’s economic stimulus package. Millions of dollars are still up for grabs in federal foodservice equipment grants for K-12 schools.

The government hopes to begin awarding the school foodservice grants beginning June 8. State deadlines to apply are approaching – in just Arkansas, Kentucky and Missouri (whose application deadlines are next week) almost $4 million in grants will be awarded. For more information and to get a state-specific application, CentralRestaurant.com

11 ways to cook up high-profit menu items

According to San Francisco Business Examiner, not since 9/11 have restaurants experienced such a rapid decline in customer count, volume and profit.

You’ve probably already heard this advice before: offer specials to attract customers; change out the menu often; analyze costs and take precautions against overspending.

But it’s also important to consider higher-profit menu items that won’t cost you an arm and a leg to prepare.

And studies actually show that comfort foods like hot sandwiches, homemade breads and appetizers are even more popular during tough economic times.

Following are three economical and space-saving countertop cooking appliances that can also help increase profits:


  • Grill a variety of different menu items – hot sandwiches, burgers, quesadillas
  • Easy to clean with a grill brush or sponge


  • Quickly toast English muffins, Texas toast, bagels
  • Two-sided toasting for faster cook times


  • Use minimal countertop space to cook a variety of menu items
  • Cook chicken fingers, egg rolls and French fries

Also consider a grill brush for easy cleanup; fry baskets to prepare a variety of menu items and a butter spreader to save valuable prep time.