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Are You Ready to Open a Restaurant?

Sep 25, 2023

It always starts like this.

You slide into your favorite local bistro’s last open bar seat after another grueling day behind your corporate desk. After the bartender slides you a 9-ounce pour of inky Cabernet, you drink in the scene with your first few sips. The place is packed, even on this Tuesday night. Servers gracefully weave through clusters of bar patrons with trays laden with craft cocktails destined for diners’ tables. The dining room is as crowded as the bar, with more eager customers waiting in the lobby. But the busiest spot in the whole place? The register where the servers ring up checks. All. Night. Long.

The music, vibe, energy, and money in the place are as intoxicating as that Cabernet in your hand.

“I can do this. I want to do this. I want to open my own restaurant. How hard could it be?”

Anyone can open a restaurant. Rent a space, get some equipment, hire some cooks, and post a neon “open” sign you picked up from Costco in the window. Done. But to succeed in the restaurant business — to stand out in a teeming crowd of competitors, to be known for something unique in the marketplace, and to make money — you need more than passion and some second-hand equipment.

If you’re determined to turn your passion into profits by starting your first restaurant, avoid these all-too-common pitfalls:

 

  • You Are Not Your Customer

Place your hand on a stack of leather-bound cocktail menus and repeat after me — “I am not my customer. I am NOT my customer!” Yes, this is your restaurant, your idea, your passion. But if you shape your vision into a concept that appeals to an audience of one, you won’t be in business long. Before you pick out colors or get a logo designed, decide who you’re building your concept for and study them. Are they adventurous foodies? Moms who need a quick and healthy meal solution for their family? Women who want a cozy place with a great cocktail menu so they can hang with friends after work? Why do they want to visit your restaurant, and how do you want them to feel? You must answer these questions fully to have a complete and targeted concept. This is the first step in separating your passion from the business, which is critical to success.

  • Don’t Start Shopping for Real Estate

Once the idea of opening your restaurant has swallowed you up, your first urge is to run out and look for a location. Must make this thing real right away! Pump the brakes. There are plenty of landlords and brokers out there who are eager to have you take over their vacancy and sign their lease. Know this — it’s infinitely easier to develop a restaurant and find the right location than to find a location and shoehorn your concept into it. You wouldn’t go car shopping by hitting every dealership in town and buying the fanciest, shiniest vehicle that someone puts you in, would you? (If you would, I want to go car shopping with you). No, you’d decide on details like gas mileage, number of seats, all-wheel drive, and, of course, price. Hold off on looking at real estate until you know what you need and what you can spend.

  • Get Your Funding in Order

Creating a new restaurant concept from scratch and opening that first location costs money. Besides developing the concept, menu, and identity, there’s equipment, construction, interior finishes, signage, licenses, and permits; you get the idea. Depending on your concept and where you set up shop, you can expect to secure funds in the mid to high six figures. Think about it — you’re building a retail and manufacturing business rolled into one. Lack of adequate start-up funding will kneecap an otherwise strong restaurant idea. Money can come from banks, family, crowdfunding, or even your own pocket. Just make sure you have enough stockpiled in advance.

  • Hone in On Your Concept

Now we get to the fun stuff — creating your brand and menu concept! At this stage, passion takes over, and many people start piling on the menu ideas. I love pasta, so let’s make it fresh! My husband loves mushrooms, so let’s put them on everything! I hate seafood, so I don’t want shellfish on the menu! When you start designing a menu, let the ideas flow, but don’t fall prey to the “gotta have” disease. Some of the most successful restaurant chains — think In-and-Out or Chik-Fil-A — have less than a dozen items on the menu. Why? They focus on making a few amazingly good menu items exceptional instead of a bunch of mediocre ones. Keeping your concept and your menu focused means your restaurant will cost less to open and require less labor to operate.

  • Know Your Lane

When starting a restaurant, most entrepreneurs dream of owning that elegant bistro down the street that they can waltz into any night, command the best table, and impress their friends. A grand vision indeed, if you have the funds to hire an expert (read: expensive) managers, chefs (see #6), servers, and cooks to run the place. More often than not, the new restauranteur will need to play a role in day-to-day operations to control labor costs. As you’re putting that focused concept together, think carefully about the work you’ll do. General manager? Kitchen manager? Front-of-house operations? Bookkeeper? Pick a role for yourself, write a thorough job description for that role, and educate yourself to be successful. Don’t try to do everything —that’s a sure-fire recipe for burnout. But do have a role in the operation. If you leave everything up to your employees, you might create a runaway train that will be difficult (and expensive) to stop.

  • Don’t Hire a Chef

Hold on, aren’t we selling food here? Don’t we need a chef to make the food? Not necessarily. Of course, thousands of restaurants are successfully owned and operated by remarkably talented chefs. But a chef may not be the right solution when you’re looking for someone to run your restaurant kitchen. A “capital C” chef expects to make their food their way. They demand full creative control of the menu and assume they will operate the kitchen how they see fit. And since they’re the person in charge of the back of the house, they’ll likely want to be hands-off and hire a bunch of line cooks they’ve worked with to work the heavy shift. All that’s fine if their culinary vision matches your concept, but it’s highly unlikely. After taking the time (and money) to develop your brand and menu, you want a kitchen manager instead — someone who will follow your direction and make the restaurant operate to your standards and expectations.

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American Dining and Ordering Habits in 2023

Sep 20, 2023

We are almost in the last quarter of this year, and two recent reports give insights on 2023 general dining habits.

The Restaurant Online Ordering Trends report offers insights from a survey of 1,505 US consumers and DoorDash data on changing restaurant consumer habits. Key findings include:

In 2023, food delivery and takeout are more popular than dining at restaurants, with 77% ordering delivery, 76% ordering takeout, and 61% dining in.

  • Curbside pickup is favored, especially by parents, making it a convenient option.
  • Due to their busy lifestyles, delivery is often a last-minute solution, especially for Gen Z and Millennials.
  • Ordering restaurant food has become a weekly habit for almost half of consumers, with many using third-party apps.
  • Consumers prefer ordering from local restaurants, with menu selection options a significant factor.
  • Third-party apps like DoorDash are the preferred way to browse and order food.
  • Social media and food photography influence younger consumers’ restaurant choices.
  • Off-peak orders, including late-night and breakfast, are growing in popularity.
  • Generational differences exist, with Gen Z and Millennials cooking less and Baby Boomers preferring home-cooked meals.
  • Fries are the top food ordered on DoorDash, followed by burgers, tacos, salad, and pizza.

 

Another recent survey conducted by US Foods® on over 1,000 Americans in 2023 reveals changing dining-out habits and preferences:

  • Americans increasingly opt for casual convenience, with takeout and delivery orders surpassing dine-in occasions. On average, they order takeout or delivery 4.5 times a month compared to eating at a restaurant three times a month.
  • The top reasons for dining out include avoiding cooking (75%), convenience (51%), and socialization (44%).
  • More than half (57%) prefer ordering takeout for its comfort and convenience.
  • 54% are willing to wait 30 minutes or more for takeout, with fast food, fast-casual, casual dining, contemporary casual, and bar and grills being popular choices.
  • 63% go out for the restaurant experience, including atmosphere and socialization.
  • Better food quality, no cleanup, and socialization are key reasons for dining out over dining at home.
  • Casual dining is the most popular restaurant type, followed by fast food, fast-casual, contemporary casual, and bar and grills.
  • The shift from physical menus to QR codes due to the COVID-19 pandemic is not universally well-received, with 76% preferring physical menus.
  • Cost is a significant factor, with half of Americans spending less than $20 per person when dining out, averaging $166 per person per month.
  • Tipping habits vary, with some now tipping 20% or more for excellent service.
  • “Bar and grills” are a popular dining choice, with booths and TVs contributing to their appeal.
Majority of those surveyed preferred physical menus

In 2023, Americans appreciate the dining-out option for its convenience, experience, and diverse restaurant choices. They use apps like DoorDash to order meals during off-peak hours, and older generations prefer home-cooked meals. It will be interesting to see if these trends continue into 2024.

Sources:

Doordash
usfoods.com
Openai.com

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California Minimum Wage Set to Increase to $20. What Should Your Restaurant Do?

Sep 13, 2023

Fast food companies and labor groups in California have reached a deal leading to a $20 minimum wage beginning in April for service industry workers in the state, pending approval by state lawmakers. This agreement prevents a costly confrontation between the companies and labor organizations, with the latter agreeing to withdraw a proposed ballot referendum and abandon a provision in Assembly Bill 1228 that would have held companies accountable for labor violations by franchisees.

The legislation also establishes a Fast Food Council with the authority to increase the minimum wage annually by up to 3.5% or based on the change in the U.S. consumer price index.

While labor groups and workers applaud this agreement, some businesses express concerns about additional regulations and higher wages potentially leading to increased consumer prices and restaurant closures.

 

What Does This Mean for Restaurant Owners?

The result of this legislation would undoubtedly raise menu prices for consumers as business owners pass on the cost to patrons. But is that always the right solution?

Raising menu prices can deter customers due to perceived lower value, price sensitivity, budget constraints, competition, psychological barriers, potential loss of customer loyalty, economic conditions, negative word of mouth, and the impact of inflation on affordability.

To mitigate the potential negative effects of raising menu prices, restaurants must carefully consider the timing and magnitude of price increases. They may also need to communicate any changes effectively to customers, emphasizing improvements in quality or service to justify the higher prices and minimize customer backlash.

value menu

Look for Cost-Saving Opportunities

Increasing your menu prices should be one of many potential solutions to consider with such economic changes. There are plenty of opportunities to enhance your restaurant’s efficiency that would help decrease costs associated with labor, hiring, menu sourcing and more. Times are more challenging than ever for operators, and Synergy has affordable tools to help your business thrive. Our three-day Operations Assessment will pinpoint improvements to your business and ensure its ongoing success. Reach out to us today to learn more: 1-888-861-9212 or email info@synergyconsultants.com.

 

Sources:

Patch.com
kcra.com
pressenteprise.com
openai.com

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What is AI-Assisted Voice Ordering, and Should Your Restaurant Use It?

Sep 07, 2023

AI-assisted voice ordering is a trending topic in the restaurant industry. It refers to using artificial intelligence (AI) and voice recognition technology to facilitate and enhance the process of placing orders or making purchases using voice commands.

DoorDash is launching AI-powered voice ordering technology to help restaurants answer all incoming customer calls, addressing the issue of unanswered calls, which can lead to potential revenue losses. This innovation combines AI with live agents to ensure quick response times. It also provides personalized recommendations to customers and allows for orders in multiple languages, offering a seamless and efficient ordering experience. Additionally, DoorDash offers a white-label solution for restaurants to facilitate the delivery of phone orders, enhancing the overall customer experience. This initiative aims to help restaurants grow their sales and meet customer expectations.

Restaurant chain Wingstop is testing an AI solution to streamline voice ordering. In a pilot program, they use ConverseNow’s voice-AI virtual assistants to handle phone orders at select locations. These virtual assistants aim to provide a natural, conversational, and personalized phone ordering experience. The AI also processes phone orders like online orders, allowing employees to fulfill AI orders without additional training. The virtual assistants use machine learning to offer automated, dynamic, and personalized upselling offers based on Wingstop’s menu items. This technology aims to eliminate missed calls and hold times during peak hours, freeing up staff to serve in-person customers. Wingstop offers phone orders in English and Spanish, allowing customers to speak to a live person if preferred.

 

In What Ways Can AI Assisted Voice Ordering Help Your Restaurant?

voice ordering

 

Implementing AI-assisted voice ordering in a restaurant setting can greatly enhance efficiency, improve customer service, and boost sales. Here’s how you can use this technology effectively:

 

Personalized Recommendations: Implement AI algorithms to provide personalized meal recommendations based on customer preferences, order history, and current promotions.

Order Customization: Customers can customize their orders using voice commands, specifying ingredients, portion sizes, and special instructions.

Order Tracking: Provide real-time order tracking through voice updates or an online platform so customers can monitor the status of their orders.

Multilingual Support: AI systems can understand and respond to orders in multiple languages to accommodate diverse customer bases.

Voice-Based Customer Support: Implement a voice assistant for customer support, addressing inquiries, resolving issues, and providing information about the restaurant, such as hours of operation.

Drive-Thru Efficiency: If your restaurant has a drive-thru, AI voice ordering can streamline the process, reduce wait times, and enhance accuracy.

Accessibility Features: AI voice ordering systems may be able to provide more accessibility features to individuals with disabilities, offering options like voice commands or touch interfaces.

Data Analytics: AI can analyze customer order data for insights into popular items, peak ordering times, and customer preferences, which can inform menu updates and marketing strategies.

Marketing and Promotions: Utilize the AI system to promote special deals, loyalty programs, or new menu items to customers during ordering.

 

What Do You Need to Consider Before Implementing AI-Assisted Voice Ordering at Your Restaurant?

  • Is the quality of the voice interaction natural and conversational, avoiding clunky robotic experiences? Voice AI should mimic normal speech patterns and allow fluent conversations.
  • Can the technology perform well in challenging physical conditions, including noisy environments, rain, wind, and snow? Quality microphones and speakers are crucial.
  • How quickly can the system integrate with your menu data? Look for voice tech that integrates easily and swiftly with your point-of-sale (POS) system.

Read more from NRN.com.

 

Sources:

Techcrunch.com
Chainstoreage.com
Nrn.com
Openai.com

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2023 Fall Menu Ideas that Will Make Your Customers Come Back for More

Aug 31, 2023

Entice customers to visit your restaurant this fall with a delicious, season-forward menu. In the realm of gastronomy, where flavors dance and ingredients harmonize, the profound significance of embracing the changing seasons cannot be overstated. As the days grow shorter and a gentle chill graces the air, a palpable anticipation that stirs in the hearts of food enthusiasts everywhere. It’s the time of year when the culinary world undergoes a captivating transformation, unveiling a tapestry of uniquely autumnal flavors.

 

How are Restaurants Embracing Fall on Their Menus in 2023?

From Dunkin’ to Starbucks, the competition to launch fall menu items is fierce, given the over $500 million industry that pumpkin spice has become. With a wide array of options, ranging from beverages to baked goods, these limited-time treats are capture customers’ hearts and taste buds. Chains like 7-11, Caribou Coffee, Krispy Kreme, and more are introducing pumpkin spice-inspired concoctions, including lattes, doughnuts, ice cream flavors, and even savory items.

Dairy Queen (DQ) is introducing its fall 2023 Blizzard Treat menu, commemorating the year of the Blizzard’s inception in 1985. To celebrate, DQ is offering limited-time 85¢ pricing on these frozen delights throughout September. The fall Blizzard Treat selection, available from August 28 at participating US locations, includes enticing flavors like the “Pumpkin Pie Blizzard Treat,” merging pumpkin pie pieces with the renowned soft-serve ice cream.

 

Not Just Pumpkin: Other Fall Flavors for your Menu

 

Fall flavors offer diverse options to elevate your restaurant menu and capture the essence of the season. Here are some popular fall flavors you can consider incorporating on your menu that aren’t just pumpkin spice!

 

Apple: Apples evoke memories of orchard visits and warm pies. They can be featured in dishes such as apple crisps, apple salads, or even as a glaze for meats.

 

Cinnamon: This spice embodies coziness. Use it in beverages like spiced lattes, desserts like cinnamon rolls, and savory dishes for added warmth.

cinnamon drink

 

Cranberry: Cranberries provide a tart and vibrant touch to both sweet and savory dishes. Consider incorporating them into sauces, chutneys, and cocktails. Tim Horton’s recently unveiled three fresh additions for enthusiasts of the season to relish, one of which is the Cranberry Refresher.

 

Maple: Maple syrup adds a rich sweetness to dishes. It can be drizzled on pancakes, used in marinades, or incorporated into sauces and glazes.

 

Nutmeg: This spice brings warmth and depth to dishes. It’s commonly found in pumpkin spice blends and can be used in both sweet and savory recipes.

 

Ginger: Ginger adds a hint of warmth and spice to dishes. Incorporate it into beverages like ginger-infused cocktails or ginger tea, as well as in sauces and desserts.

 

Squash: Varieties like butternut and acorn squash can be roasted, pureed, or used in soups, adding a hearty and comforting element to your menu.

 

Pear: Pears offer a subtle sweetness that pairs well with cheeses, salads, and desserts like tarts and cobblers.

 

Caramel: Caramel provides a rich and indulgent flavor. Incorporate it into desserts like caramel apple pie, caramel macchiatos, or drizzled over ice cream.

 

caramel fall flavors
Caramel topped cheesecake

 

Sweet Potato: Sweet potatoes can be used in various ways, from fries and casseroles to pies and even as a base for savory dishes.

 

Cider: Whether hot or cold, apple cider can be a refreshing and seasonal addition to your beverage menu. It can also be used as a base for cocktails.

 

Caramelized Onion: The sweetness of caramelized onions can be used in various dishes, from savory tarts to sandwiches and burgers.

 

Sage: Sage has an earthy and aromatic flavor that pairs well with fall dishes like roasted meats, stuffings, and even pasta dishes.

 

Whether adding a touch of warmth to your beverages, creating comforting soups, or reimagining classic desserts, these fall flavors can infuse your menu with the season’s spirit.

 

Sources

Franchisewire.com
masslive.com
Mashed.com
OpenAi.com

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Embracing the Evolving Landscape: Key Findings from the 2023 National Restaurant Association State of the Industry Report

Aug 28, 2023

In a landscape forever altered by global events, the restaurant industry is embracing a new normal that demands adaptability, innovation, and a profound understanding of evolving consumer behaviors. The recently unveiled 2023 National Restaurant Association State of the Industry Report sheds light on the pivotal shifts that have reshaped the culinary world, offering valuable insights into the challenges and opportunities that lie ahead.

The Unveiling of the New Normal:

The 2023 State of the Industry Report unveils a transformative period for the restaurant sector that has led to the emergence of a new normal. The restaurant industry was at the forefront of change as the world navigated unprecedented challenges. Insights from the report provide a comprehensive overview of how restaurants are rewriting their playbooks to thrive in the current landscape.

Adaptability: The Cornerstone of Survival:

One resounding theme from the report is the industry’s resilience and adaptability. Restaurants have embraced a fluid approach to their business models, emphasizing enhancing off-premises dining options. The pandemic-induced takeout, delivery, and curbside services surge has sustained many establishments and fueled the growth of ghost kitchens and virtual concepts.

Technology as a Catalyst:

Technology’s role in shaping the restaurant landscape has never been more evident. The report highlights the acceleration of tech adoption, from contactless ordering and payment systems to sophisticated delivery logistics. Restaurants are embracing the digital realm to streamline operations, enhance guest experiences, and facilitate more efficient workflows.

Reimagining the Guest Experience:

The guest experience has undergone a metamorphosis, with safety and convenience now holding paramount importance. Diners have come to expect transparent hygiene practices, flexible ordering options, and even augmented reality menus that minimize touchpoints. Restaurants prioritizing safety while providing a seamless experience are poised to stand out in this new era.

Workforce Evolution:

The restaurant workforce has also seen transformative shifts. The report underscores the challenges faced by the industry in attracting and retaining talent. Creative solutions, such as flexible scheduling and tailored training programs, are being explored to address these issues and create a more sustainable work environment.

Sustainability Takes Center Stage:

Sustainability has emerged as a key consideration for both consumers and restaurants. From sourcing ingredients ethically to reducing food waste, establishments demonstrate their commitment to environmental responsibility. As sustainability aligns with changing consumer values, it also presents a unique market differentiator.

 

sustainable

A Glimpse of the Future:

The 2023 State of the Industry Report offers a glimpse of a dynamic future where innovation is paramount. By leveraging adaptability, embracing technology, and redefining the guest experience, restaurants are positioned to thrive in the new normal. The report’s insights serve as a compass, guiding the industry toward a reimagined future that capitalizes on evolving consumer preferences while upholding the timeless essence of hospitality.

The restaurant industry’s journey through the new normal is a testament to its resilience and capacity for reinvention. The 2023 National Restaurant Association State of the Industry Report serves as a beacon of insight, shedding light on the strategies that have shaped success in this evolving landscape. Armed with these insights, restaurants are well-equipped to navigate the path ahead, embracing change, seizing opportunities, and carving out a vibrant future in the ever-transforming world of culinary excellence.

 

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Fast Food Chains and the Kiosk Revolution: Enhancing Customer Experience and Efficiency

Aug 28, 2023

In a world driven by technological advancements and changing consumer preferences, the fast-food industry is continuously evolving to meet the demands of modern customers. A prominent trend in this evolution is the widespread adoption of self-service kiosks in fast-food chains. These digital touchpoints are transforming how customers interact with their favorite eateries and redefining operational efficiency for restaurant businesses.

Embracing the Age of Self-Service

In recent years, self-service kiosks have taken the fast-food industry by storm. A shift in customer behavior towards convenience and speed has increased acceptance of these interactive terminals. A report from the National Restaurant Association revealed that over 60% of consumers agree that self-service technology makes their dining experience more convenient.

The Convenience Factor

One of the most significant advantages of self-service kiosks is the enhanced convenience they offer to customers. The ability to browse through a digital menu, customize orders, and make payments within a few taps is a game-changer. Kiosks eliminate the need to stand in long queues, resulting in quicker order processing and reduced waiting times – a win-win situation for customers and restaurants.

Personalization at its Best

Self-service kiosks provide a platform for customers to tailor their orders precisely to their preferences. Every detail is at the customer’s fingertips, from extra cheese to no onions. This ensures accuracy and enhances customer satisfaction by delivering orders exactly as desired.

self-service

Empowering the Customer

Fast-food chains are using self-service kiosks to empower their customers. These terminals offer detailed nutritional information, ingredient lists, and allergen alerts, enabling customers to make informed choices that align with their dietary needs and preferences.

Streamlining Operations

The advantages of self-service kiosks are not limited to the customer side. Fast-food chains are benefiting from streamlined operations and increased efficiency. With kiosks handling a significant portion of orders, staff can focus more on preparing and serving food. This redistribution of tasks results in smoother operations, reduced human error, and improved customer service.

The Human Touch

While self-service kiosks play a pivotal role in enhancing the fast-food experience, they do not replace the importance of human interaction. Many chains are finding a balance between technology and human service. Staff members are freed from taking orders, allowing them to engage more with customers, address concerns, and ensure a positive dining experience.

The Road Ahead

As the fast-food industry continues to evolve, self-service kiosks will likely remain prominent in restaurants worldwide. With technological advancements, we expect to see more sophisticated interfaces, increased integration with mobile apps, and further personalization options.

Integrating self-service kiosks in fast-food chains is not just a technological trend but a transformative shift in how restaurants and customers interact. These terminals provide unmatched convenience, personalization, and efficiency. As technology continues to reshape the dining experience, one thing is certain – the kiosk revolution is here to stay, redefining fast food for the better.

 

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Navigating Menu Price Fatigue: Strategies for Restaurants to Sustain Customer Loyalty

Aug 28, 2023

In an era marked by rapidly evolving consumer preferences and economic fluctuations, the restaurant industry faces a challenge that resonates with both customers and business owners alike – menu price fatigue. A recent trend suggests that consumers might be experiencing a sense of weariness when regarding the continuous rise in restaurant menu prices. In this article, we delve into the phenomenon of menu price fatigue, its implications, and strategies that restaurants can adopt to strike a balance between maintaining profitability and nurturing customer loyalty.

Unraveling Menu Price Fatigue

Menu price fatigue, as the name suggests, refers to the growing resistance among consumers toward consistently increasing prices on restaurant menus. With rising costs in labor, ingredients, and operational expenses, it’s no surprise that restaurants have adjusted their prices to accommodate these changes. However, customers’ budgets cannot always keep up with these frequent adjustments.

The Impact on Customer Behavior

The constant rise in menu prices can significantly impact customer behavior. While valuing the dining-out experience, consumers may become more selective about where and when they choose to dine. Frequent price hikes could lead to fewer regular visits, opting for more budget-friendly alternatives instead.

Maintaining Customer Loyalty

To navigate this challenge, restaurants must prioritize maintaining customer loyalty while maintaining profitability. Here are some strategic approaches:

  1. Value-Driven Menus: Craft menus that highlight value propositions. Offer bundled deals, special promotions, or discounted meal combinations that provide customers with more for their money.
  2. Transparent Communication: Be transparent about price adjustments. Clearly communicate the reasons behind changes in menu prices, such as ingredient quality improvements or sustainability initiatives.
  3. Menu Engineering: Strategically design menus to emphasize dishes with higher profit margins. Highlight signature items that offer a unique experience, giving customers a reason to justify their spending.
  4. Enhance Dining Experience: Focus on enhancing the overall dining experience. Stellar service, ambiance, and personalized interactions can offset menu price concerns, making customers feel they are getting more than just a meal.
  5. Loyalty Programs: Implement loyalty programs that reward customers for their repeat business. Discounts, exclusive offers, or free items after a certain number of visits can create an incentive for customers to return.
  6. Feedback and Adaptation: Regularly solicit customer feedback to gauge their perceptions of menu pricing. Use this input to make informed adjustments that resonate with their expectations.

Balancing Profitability and Customer Satisfaction

Balancing the need for profitability with customer satisfaction is a delicate task. Restaurants must be agile in their approach to pricing. Careful consideration of consumer sentiment, market trends, and competitive analysis is essential to make informed decisions.

The phenomenon of menu price fatigue presents an intricate challenge for restaurants to overcome. By focusing on value-driven menus, transparent communication, and enhancing the overall dining experience, establishments can mitigate the impact of rising prices on customer loyalty. Navigating this landscape requires a strategic blend of creativity, adaptability, and a deep understanding of consumer preferences. Ultimately, balancing pricing and customer satisfaction is crucial to sustaining success in a competitive culinary world.

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The Latest in Restaurant Automation in 2023

Aug 21, 2023

Decades ago, restaurants pioneered basic automation to enhance efficiency – early technologies like cash registers, mechanical calculators, and vending machines streamlined transactions and self-service. Automated coffee makers and buffet setups improved speed and consistency. Conveyor belts presented dishes in early sushi places, and kitchen appliances expedited food prep. Drive-thru windows emerged for faster service. These innovations formed the foundation for modern restaurant automation, showing a persistent drive to increase efficiency, minimize labor, and elevate customer convenience.

In the rapidly evolving landscape of the culinary industry, restaurants are increasingly embracing the transformative power of Artificial Intelligence (AI) to enhance various aspects of their operations. This surge in AI integration stems from its unparalleled ability to optimize processes, enhance customer experiences, and streamline decision-making. From personalized menu recommendations based on customer preferences to efficient inventory management and advanced culinary creativity, AI technologies are revolutionizing how restaurants function. As competition grows fiercer and consumer expectations become more sophisticated, restaurants find themselves compelled to harness AI-driven solutions to stay relevant and deliver unparalleled dining experiences.

 

How Are Restaurants Using Automation in 2023?

White Castle, a renowned fast-food chain, is making strides in embracing AI technology by partnering with SoundHound, a voice AI platform, to introduce voice ordering at more of its drive-thru lanes. This initiative is set to elevate the number of AI-powered drive-thru restaurants to around 100, constituting over a quarter of White Castle’s entire portfolio, by the conclusion of 2024. The company envisions enhancing customer experiences and operational efficiency, with many AI-supported locations operating 24/7.

 

drive-thru ai

 

Checkers Drive-In Restaurants, a U.S.-based fast-food chain, has partnered with Hi Auto to introduce AI voice technology in its drive-throughs. The collaboration involves deploying Hi Auto’s Spanish-language drive-through AI voice technology across over 350 Checkers and Rally locations. This marks the first instance of bilingual drive-through voice AI ordering in the industry.

Meanwhile, Chipotle founder Steve Ells has devised an intriguing concept for a semi-automated restaurant named Kernel, focusing on automation with a human touch. Securing $36 million in series A funding, Kernel plans to launch in New York City this fall, potentially establishing 15 more locations in the vicinity over the next couple of years. The innovative venture emphasizes plant-based ingredients and automation, yet further details about its unique approach remain undisclosed. These developments collectively underscore the ongoing surge of AI and automation within the restaurant industry, reshaping how eateries operate and engage with customers.

 

How Consumers Feel about Automation

PYMNTS’ exclusive report titled “Connected Dining: The Robot Will Take Your Order Now” is based on a survey of nearly 2,000 U.S. consumers conducted recently. The report delves into consumer sentiments towards various restaurant technologies and the factors driving those opinions. The study found that two-thirds of consumers are not interested in robotics-powered food preparation, with most of them concerned about the potential impact of automation on food quality and personalization. A notable 83% of respondents believed that food prepared by robots would be lower quality and less personalized compared to human-prepared meals. This concern aligns with a previous study that revealed around 4 in 10 consumers perceive a decline in personalized service at restaurants. Despite these concerns, automation is gaining traction in the industry, particularly in kitchen operations. Some consumers are embracing these innovations, especially younger demographics, who are more open to testing new tech, as evidenced by the positive response to autonomous robotic food service kiosks in certain restaurant chains.

As the restaurant industry continues to adapt to evolving consumer preferences and technological advancements, it’s evident that AI will remain a significant and growing component of restaurant operations.

 

 

Sources:

Nrn.com
verdictfoodservice.com
Pymnts.com

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Service Fees: How Patrons Really Feel About Them

Aug 16, 2023

The dining experience has evolved beyond savoring delicious dishes to encompass a growing concern among restaurant customers: the emergence of contentious service fees. As more eateries across the culinary landscape tack on additional charges, patrons are increasingly expressing frustration and confusion. These fees, intended to address issues of pay equity and rising business costs, are sparking debates about transparency, fairness, and the overall dining experience.

These charges often show up at the bottom of the receipt, separate from tips for the server or cooking staff. The National Restaurant Association estimates that around 15% of restaurants add these fees. Proposed solutions include requiring businesses to include taxes and fees in listed service prices, similar to European practices. The Federal Trade Commission is exploring regulations to address deceptive fees.

 

Keeping Score

Reddit users in Los Angeles and Chicago have compiled spreadsheets of restaurants with these fees, sparking discussions about their transparency and allocation. These additional charges, often ranging from 3% to 20%, bear labels such as “healthcare surcharge” or “wellness fee,” leaving patrons perplexed. The Reddit spreadsheet highlights service fees in LA that have gained traction, listing nearly 240 establishments and whether the fees supplement server tips.

 

Restaurants Vs. Employees

While some restaurateurs argue these fees ensure fair pay distribution between front-of-house and kitchen staff, restaurant employees contend that such charges often benefit owners more than employees. A class-action lawsuit against Jon & Vinny’s in Los Angeles claims that their 18% service charge doesn’t actually benefit servers. The confusion over these fees, often presented separately from tips, has led to a Reddit-driven effort to track and criticize restaurants imposing them.

restaurant fees

What’s Happening in DC?

DC’s dining scene has seen a surge in extra fees, causing customer confusion and frustration. The Office of the Attorney General issued guidance on fee transparency, including examples of compliant practices. These fees have increased due to Initiative 82, eliminating the “tip credit,” pushing restaurants to replace the $5.35/hr. minimum for tipped workers with at least $17/hr. To offset this, many added mandatory service fees, alongside other charges, ranging from 3% to 22%, with vague explanations.

Attorney General Brian Schwalb’s consumer alert in March stressed clear and prominent fee disclosure before orders. The “supplemental business advisory” requires specific fee descriptions, distinguishing whether they support base wages or are extra, like tips. Guidelines mandate prominent fee display on menus and prohibit burying fees in fine print or combining them with unrelated details. Violators may face warnings, refunds, penalties, or practice changes.

Examples of allowed fee disclosures are given, with compliance assessed case by case.

 

Sources:

Ktla.com
thetakeout.com
eater.com
Washingtonian.com
Latimes.com
openai.com