Restaurant Industry Insights

Restaurant Industry Insights as 2023 Comes to a Close

With 2024 in our sights, restaurant operators are beginning to think about strategies for the upcoming year. They’re analyzing what worked for them, the challenges they faced this year, and how to best prepare for a successful new year and beyond. In light of the present mind state, we’re sharing some highlights of Toast’s recent Restaurant Operator Insights Report. Discover the major pain points for others in the industry and the steps they took to resolve them.

The Top Three Challenges

According to Toast’s annual survey, which focused on small and medium-sized enterprises, inflation, increasing guest throughput, and hiring employees were the top three pain points. Inflationary pressures took the number one spot by a slim margin. 

In response to this pressure, restaurant operators focused on three measures: 

  • Raised menu prices
  • Adjusted the number of suppliers
  • Tracked ingredient prices

The technology they incorporated to help them in their efforts was predominantly accounting and inventory management solutions. 

Menu Pricing

As always, the question remains: how much can you raise prices before you start impacting demand? And, at what point is it better to reduce the portion size or re-strategize the menu as a whole? These recurring questions and challenges led EMERGING to search for a better way for their clients. In response, they came up with F&B Insights.

This platform provides the world’s largest menu database. Now, you can quickly discover the prices other restaurants in your area charge and receive an alert when a restaurant changes its menu. You’re no longer left wondering if your brand is over-pricing your competitors to the point of affecting demand. Access to menus across the nation gives you knowledge of trending items, including the global flavors and authentic regional cooking methods continuing to grow in popularity.

Increasing Traffic and Throughput

The survey shows that over 50% of restaurant operators are turning to social media to increase brand awareness and traffic. SMS marketing is also on the upswing, the mobile marketing strategy that sends text messages to customers. This approach lets restaurants send cost-effective offers, menu updates, and suggestions to their targeted market.

Restaurants have also increased adoption of loyalty programs, email marketing, and reservation software. One of the latest restaurant technology solutions to emerge is Tablz. This immersive booking experience integrates with your reservation management system and gives potential guests a 3D video view of your restaurant, letting them select a specific table using dynamic pricing. 

Restaurant Hiring

Restaurant hiring still remains a top challenge. To combat this persistent pain point, restaurants have turned to hiring technology, such as recruiting software. They’re also implementing training resources, employee incentive programs, and scheduling software. Today’s employees appreciate flexibility, and many restaurants have responded by utilizing software that lets them exchange shifts or find replacements when something comes up in their lives.

Additional technology making strong headwinds includes handheld POS systems for servers and mobile payment and ordering options.

Target Workforce, a proprietary restaurant technology, entered the scene as the challenges in the labor pool reduced restaurants’ profits and the ability to provide their guests with the excellent customer service they’d come to expect. The technology uses advanced geo-location, mobile tracking, and IP address verification to help restaurants find the highest quality, trained staff at the lowest recruiting costs. 

What Our Guests Expect in 2024

While many of our guests gave us some leeway, knowing the challenges we faced post-pandemic, they expect us to have those all sorted out in the coming year. There’s no more give and take, no matter the staff shortages, supply chain issues, or inflationary pressures. They expect seamless operations and an experience shared with friends and family that’s worth remembering.

With the latest technology and a few (or many) changes in protocol, menu development, and marketing strategies, we can deliver. Here’s to 2024, and may it be your best year yet.  

FAQS

What is the turnover rate for restaurants in 2023?

According to Toast, the average restaurant industry turnover rate from 2013 to 2019 was over 71%. In 2020, that figure rose to 132% due to restaurant closures and lockdowns. The estimated 2023 turnover rate is just over 74%.

What are restaurants doing with inflation?

Restaurants are focused on the fine line between retaining profit margins by increasing menu prices and reducing customer demand. They’re exploring supply chain options, menu strategies, and recipe modifications. 

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