As the industry stumbles in its long-awaited recovery from the persistent pandemic, operators once again scramble to cook up solutions for sagging sales. U.S. Census Bureau data shows that restaurant sales fell for the second consecutive month in January as the business landscape presented an obstacle course of challenges, from labor shortages to supply chain breaks to rising inflation.1While restaurant sales surged to $73.1 billion in November, they tumbled to $72.7 billion in December and $72 billion in January, forcing operators to eat losses.1 More than half of restaurants reported curtailing hours of operation in January, and 34% closed on days they would typically be open. In addition, 25% reduced seating capacity, and food prices have increased 12.8% so far this year.1
As Sean Kennedy, executive vice president of public affairs with the National Restaurant Association, explained, the falloff in sales highlights the devastating impact restaurants continue to feel from the pandemic. “While most of the economy showed growth in January, restaurant sales were down for a second month in a row; after adjusting for inflation, sales were nearly $3 billion below mid-2021 levels,” Kennedy said.1
From Robots to Rewards: Tech Expected to Turn the Tables
The disappointing numbers add urgency to restaurant consultants Baum + Whiteman’s forecast that the integration of labor- and time-saving robotics will be the top trend in 2022. “The industry hasn’t been able to raise wages enough for employees to return … and constantly increasing payroll costs pushes employers emphatically into the age of robotization,” they report.2 Food-making machines replacing or working alongside human employees is becoming a go-to survival strategy that could point the way to the future of foodservice, with greater operational efficiency and more favorable margins.
Declining sales figures and the reduction of operating hours and seating could also accelerate the growth of ghost kitchens, another 2022 trend identified by Baum + Whiteman.2 The consultants predict “a competitive free-for-all as ghost kitchens throttle up expansion” and cites research projecting that ghost kitchens could become a $139.4 billion industry by 2028.2
Baum + Whiteman cite Reef Kitchens as a powerhouse at the forefront of the ghost kitchen boom, with plans to open hundreds of ghost kitchens over the next five years—700 for Wendy’s, 500 for the pizza chain 800 Degrees and 300 for the Friday’s restaurant brand.2
As reported in a previous post, the need to offset the toll being taken by labor challenges and rising costs has made mobile apps that emphasize engagement and encourage repeat business mission-critical for restaurant operations.
Geofencing technology company Bluedot found that consumers surveyed prefer by far self-service digital ordering over ordering from restaurant staff.3 Forty-three percent favor placing their order with their mobile phone, compared with 18% for ordering from a staff member.3
What’s more, 52% want mobile apps from local chain restaurants to provide loyalty/rewards. Fast-casual restaurant chain QDOBA has enhanced its rewards program to make it faster and easier for members to earn free food. The new two-tier program features Foodie Status (1 point per dollar spent, a free entree at 125 points and upgraded status after 12 QDOBA visits per year) and Chef Status (all Foodie benefits, $2 signature Queso & Chips with every visit and chances to earn additional points throughout the year).4
“Our guests appreciate that we have set up a program that gets them to flavorful rewards fast, as we've already seen a 20% increase in weekly sign-ups since the program launched,” said Keith Guilbault, CEO of QDOBA.4
From on-trend LTOs that make great rewards to travel-friendly dishes, desserts and beverages, the acclaimed chefs at Mondelēz International Foodservice are here to help your foodservice operation optimize its menu mix for a new era. Our unique combination of culinary creativity and trusted brand ingredients helps maximize sales on premises and off. Contact us below to learn more about how we can turn the tables on challenging times for breakthrough success.
1 Fantozzi, Jennifer, “Restaurant sales drop for the second straight month in January,” Nation’s Restaurant News, February 17, 2022
2 Baum + Whiteman, 2022 Food and Beverage Forecast
3 Bluedot, The State of What Feeds Us Volume 5, September 2021
4 QDOBA, “QDOBA launches all-new rewards program making it easier for members to earn flavorful rewards fast,” Nation’s Restaurant News, February 18, 2022