Restaurant optimism fueled by continued employment growth, technology advancements and expanded consumer use of restaurant apps, off-premises and loyalty programs Restaurants sales are forecast to exceed $1.1 trillion in sales this year, marking a new milestone for the industry that will employ over 15.7 million people in the United States by the end of 2024. This is all according to the National Restaurant Association 2024 State of the Restaurant Industry Report. Key findings from this year’s report include:
Operators and Consumers Alike See Value in Technology and Special Deals and Promotions Consumers’ affinity for technology in restaurants varies and as a result, operators are strategically deciding how to incorporate technology into the experience. For fullservice restaurants, nearly half (46 percent) of adults think technology has a positive impact, and this number weighs heavily towards younger consumers (64 percent of Gen Z and 66 percent of Millennials). Similarly, this group is more likely to want more technology options according to the research. These preferences can help operators make informed decisions on where and how to invest. In 2023, just under half (48 percent) of operators made technology investments to enhance the customer experience but 60 percent plan to make an investment in 2024. The areas where consumers say technology would have the most positive impact on their personal experience include options that make ordering and paying easier and faster. If consumers are somewhat split on technology, they can agree on the value of a special deal or discount, with 7 in 10 adults saying they often look for a daily special or discount. Customers (85 percent) are more flexible about when they dine if it comes with a deal and 84 percent said they’d take advantage of deals offered for dining at off-peak times. Further, 75 percent of adults would opt for smaller-sized portions for a lower price—a trend that can help restaurants curb food waste and improve profits. To further fuel customer retention, the data suggests focusing on loyalty and rewards programs. Customers prefer to see this type of program on a smartphone app, further enforcing the need for technological innovation and creating additional touchpoints between customers and restaurants. Restaurant Employment to Reach 15.7 Million in 2024 The restaurant and foodservice industry is projected to add 200,000 jobs in 2024, bringing total industry employment to 15.7 million. Between 2024 and 2032, the industry is projected to add 150,000 jobs per year on average, with total staffing levels reaching 16.9 million by 2032. Despite this expansion, 45 percent of operators say their restaurant doesn’t have enough employees to support existing customer demand. Operators looking for the necessary support are turning to the gig economy and technology. One in four operators say using gig workers to fill in staffing will become more common in their segment in 2024 and nearly half (47 percent) of operators say the use of technology and automation to help with the current labor shortage will become more common. Food Cost and Availability Influence Menus the Most If consumers notice menu changes on a more frequent basis, it’s often the result of increased food costs. In the past year, operators report needing to find new suppliers, removing items from their menus, adjusting portion sizes or substituting lower cost items all in response to elevated food prices. The availability of food items impacted menu composition as well, with more than three quarters (77 percent) of operators saying their restaurant experienced supply delays or shortages of key food or beverage items in 2023. These changes will present a challenge for operators, especially with most adults (86 percent) saying they like ample choices on menus. Further directing menu choices are social media trends. As the National Restaurant Association’s 2024 What’s Hot Culinary Forecast shows, savvy operators are turning to TikTok and other social media platforms to be inspired and to fire up viral trends. Operators will need to be strategic in how they balance thoughtfully streamlined, food-cost-effective menus and enough variety to satisfy demand and lead the latest trends. For those offering it, off-premises remains a key area of opportunity, and customers agree, with a vast majority (88 percent) reporting being satisfied with the variety of local food options for takeout and delivery. Customers are viewing take-out in new ways, with two thirds (67 percent) of adults saying they’d be interested in subscriptions that offer a specified number of meals each month and half (53 percent) saying they’re open to supplementing home-cooked meals with restaurant-prepared items. “This is an historic and exciting year for the restaurant industry,” added Hudson Riehle, Senior Vice President of the Research and Knowledge Group for the National Restaurant Association. “While challenges remain—including inflation, recruitment, higher operating costs and profitability—restaurant operators will continue to innovate and evolve to meet customer demands.” The 2024 State of the Restaurant Industry report is free to Wisconsin Restaurant Association restaurateur members ($349 for non-members). WRA members wishing to access the report, need to log into the National Restaurant Association Store before downloading the report. There’s a login link in the bar at the top. If you experience difficulties accessing the report for free, email Membership@Restaurant.org to request to be linked to your company's membership record.
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In case you haven’t heard, there have been some big legislative wins for restaurants that you need to know about.
Your WRA advocacy team lobbied for these 4 new laws that positively impact restaurants. We have all the details on the new laws including the dates they go into effect and what it means for restaurants. The Federal Trade Commission (FTC) has extended the comment deadline regarding their sweeping proposal that would ban service fees and surcharges at restaurants of all sizes. Restaurant operators will have until February 7, 2024 to provide input.
As the FTC’s proposed rule is written it would prevent operators from including common, accepted surcharges on a customer’s bill. It would even ban delivery, large party, and credit card processing surcharges. Instead, the proposed rule would force operators to overhaul menu prices so that the listed price is the total price a customer must pay. Higher menu prices will reduce customer traffic, reducing income for restaurant employees and operators. The FTC admits its plan will cost restaurant operators $3.5 billion to implement. The National Restaurant Association will lead the industry effort in Washington to change this rule, but the FTC needs to hear your voice and your perspective. Please take two minutes to help us fight this unaffordable regulatory overreach by sharing your views here. To learn more, see the National Restaurant Association's new fact sheet on the FTC proposal and view the recording of their webinar on how the proposal would negatively effect restaurants. Governor Signs Two of WRA's High Priority Bills The WRA's Third Party Delivery Consent bill (Act 75), and the Omnibus Alcohol Bill (Act 73) were signed by Governor Evers on Wednesday, December 6. Both of these bills have been a high priority for WRA in 2023. Third Party Delivery Consent Wisconsin is the 14th state to enact measures relating to how Third Party Delivery Companies interact with restaurants. At the request of the WRA, Senator Pat Testin and Representative Alex Dallman introduced this new law to curb third party delivery company business practices that emerged during the pandemic that are harmful and costly to restaurants. This law ensures:
This law goes into effect on July 1, 2024. WRA will work with the Consumer Protection Division at DATCP as it enacts the law and creates resources on its website. Alcohol Laws Reform Act 73 (the Omnibus Alcohol Bill) brings many needed updates to Wisconsin's alcohol statutes. It clarifies what is now considered policy interpretations, makes some common industry practices legal and provides a more prominent place for alcohol law interpretation and enforcement at the state agency level. Here are the main provisions of the bill that triggered WRA support:
This year’s What’s Hot Culinary Forecast draws on the expertise of more than 1,500 culinary professionals who were asked to rank 120 items in 7 categories:
The What’s Hot Culinary Forecast presents the top 10 Hot Trends overall, the top trends in each category, trends the pros see as emerging in each category and macro trends shaping menus, operations and marketing. Is your menu trending? Download your free copy of the report today! It is the time of year we all count on to promote our businesses, particularly our spirits, wine, and beer sales. As people start feeling more festive, they want to consume, and we want to be the first to offer them a drink. As we prepare for the Holiday rush this year, let’s not forget that we want to keep are guests safe and prevent over-service. When you serve alcohol, you know the risks. Risk lawsuits if you over-serve. Risk lives if you serve a drunk driver. Risk your livelihood if you sell to a minor. That’s why there's ServSafe Alcohol training which focuses on important issues like gauging intoxication levels, measuring drinks, checking proper identification, dealing with difficult situations and more. With ServSafe Alcohol training, your team can let the good times roll while practicing responsible alcohol service. The National Labor Relations Board (NLRB) has released its final joint employer rule, broadening the conditions under which two businesses might be considered jointly liable for legal issues or organizing campaigns. This rule does not only impact the franchise restaurant model but will also impact all restaurants that contract for services like cleaning or lawn care. The National Restaurant Association and the Wisconsin Restaurant Association strongly oppose the NLRB’s final rule.
NOTE: In late November, the effective date was changed from December 26, 2023 to February 26, 2024. Click here for more info on the date change. History Revisited Previously, joint employer status was largely contingent on an entity's “direct and immediate control” over the key terms of another organization's employees. The 2020 Final Rule provided clear boundaries, granting certainty to industry participants. What’s New The NLRB's latest update expands the joint employer standard. Now, entities can be jointly classified by "sharing or co-determining" essential aspects of employment terms. This change encompasses both indirect influences and reserved controls. Entities identified as joint employers are obligated to participate in collective bargaining with the union representing their shared employees. Furthermore, they're potentially liable for each other's unfair labor practices and become vulnerable to union pressures in the event of labor disputes. Expanding the Scope The implications of the rule aren't confined to explicit, direct relationships. Circumstances where an entity impacts another’s employees through intermediaries or merely possesses (but does not exercise) control over employment conditions can now indicate a joint employer dynamic. Who’s Affected? The franchise business model is squarely in the crosshairs. While the 2020 Final Rule, under the "direct and immediate" standard, provided a conducive environment for the industry to flourish, the current iteration neglects the industry's concerns. In the National Restaurant Association and Restaurant Law Center’s (RLC) comments to the proposed rule, they emphasized that, at the very least, the rule should clarify that it does not encompass franchise agreements or other clauses tied to legitimate business reasons, such as brand maintenance and product quality. Regrettably, our suggestions weren't heeded. Bigger Picture This is not just a minor regulatory adjustment; it's a foundational change. The rule's lack of clarity could spur extensive legal challenges and increased liability risks. Amid these unprecedented challenges, the National Restaurant Association and RLC are exploring all avenues, including potential legislative and legal actions, to restore a practical standard. More Information Littler-Mendelsohn Assessment of Final Rule National Restaurant Association Statement on the 2023 Joint Employer Final Rule NLRB Final Rule: Standard for Determining Joint Employer Status NLRB FACT SHEET Joint-Employer Standard Final Rule The WRA's Third Party Delivery Consent bill (AB 294/SB 290) unanimously passed both the Wisconsin Senate and Assembly on Tuesday, October 17! The bill is now available for the Governor to sign. WRA staff has met with the Governor's policy team encouraging him to sign the bill as soon as it is available. At the request of the WRA, Senator Pat Testin and Representative Alex Dallman introduced these bills to curb third party delivery company business practices that emerged during the pandemic that are harmful and costly to restaurants. This bill ensures:
For more information on this bill and WRA’s legislative priorities, please email Susan Quam. The Wisconsin tourism public relations team is looking to gather information on unique culinary offerings in Wisconsin.
Please share information on any of the following:
Email your submission to the Wisconsin Tourism PR team directly at wisconsin@turnerpr.com with the subject line "Request for Information: Unique Culinary Offerings" The email must be received by 5 PM (CST) Friday, October 20th to be considered for this opportunity. When submitting, please indicate:
The IRS recently announced that it is pausing acceptance of new Employee Retention Credit submissions through at least the end of the year. The reason for this pause is to prevent fraud and manage the backlog of nearly 600,000 pending applications. Unfortunately, the ERC has been targeted by less than reputable companies and the IRS is seeing some fraudulent applications. This is why WRA is working with Adesso Capital—an established, reputable, vetted company that many other state restaurant associations are working with as well. Adesso's experts are well-versed with all aspects of the ERC and specialize in working with restaurants. So far Adesso has helped Wisconsin restaurants claim nearly $12 million in ERC dollars through our partnership. What Does This Pause Mean for Restaurants?
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