Welcome to the fourth edition of The Rush, where we cover notable happenings in the industry. This week's coverage includes a recap of new menu technology, restaurant spending hitting an all-time high, and beef over a chicken sandwich. Plus, a restaurant training manual to ensure your employees are ready for more customers.
Restaurant spending is projected to hit an all-time high in 2019, despite fears of an impending recession.
Cava is testing out digital menus in a new test kitchen concept, joining the ranks of Chipotle, ShakeShack, and KFC with similar tech adoptions.
Popeyes adds a chicken sandwich to its menu and the internet is freaking out.
Restaurant Spending to Hit an All-Time High in 2019 💸
Consumers are spending more of their budget dining out. Sales at restaurants are up over 4% this year, according to data from the U.S. Census Bureau, surpassing grocery sales by 1%.
The National Restaurant Association projects overall industry sales will hit a new high of $863 billion in 2019, up 3.6% year over year.
Restaurant owners and operators will still face challenges to success like hiring and retention - but customers will continue to spend money in restaurants.
Domino’s Pizza CEO Ritch Allison was quoted saying that the U.S. consumer is still strong, despite fears of an impending recession.
Consumers and analysts have been wary of a potential recession in the near future for a while now, but according to The National Restaurant Association, that hasn’t stopped people from spending their hard-earned money on eating out. American consumers continue to increase their spending in restaurants. According to U.S. Census Bureau data, restaurant spending is projected to increase from $832 billion in 2018 to $863 billion in 2019.
Hudson Riehle, the National Restaurant Association’s Senior Vice President of Research, told CNBC that there are two main drivers for the industry at this point in time: Convenience and socialization. These factors back up the increased growth in quick service and fast-casual restaurant locations. Unsurprisingly, there is also a greater focus on delivery and take-out due to convenience.
For enterprise delivery restaurants like Domino’s, an increase in spending – along with an interest quick-service and delivery – marks a great period of time for business and employment.
“The most important thing when it comes to driving demand for pizza is having employed customers...who have disposable income and can afford to feed their families,” said CEO Ritch Allison on CNBC’s “The Exchange” on Tuesday.
More Large Chains are Adopting Menu Technology 🖥️📱
Cava opened an innovation kitchen on Monday, which will be equipped with digital menu boards.
Earlier this year, McDonald’s acquired machine learning company Dynamic Yield for $300 million. It has since rolled out new Dynamic Menus across 8,000 U.S. locations.
Tech that makes getting food on the go an even faster, more personalized experience is what will drive enterprise fast-food company innovation.
Cava, a sustainably-sourced, fast-casual Mediterranean restaurant, has announced its first innovation kitchen, similar to test-kitchen concepts piloted by Chipotle and KFC. The restaurant wants to use new technology in their Washington, DC-based innovation kitchen to predict customer ordering trends and ultimately save money by avoiding focus groups and test markets.
According to a Restaurant Dive brief, the kitchen will contain “digital menu boards to display customers' orders as well as a list of products being tested. Using data collected on consumer behavior, analysts within Cava's corporate arm will evaluate which products and technologies should be rolled out across its U.S. stores.”
Looking at McDonald’s recent acquisition of Dynamic Menus and test kitchens by Chipotle, KFC, Cava, and other chains, progressive data-collecting technology seems to be a key element in these big brands' invididual growth strategies. Ordering technology, from mobile apps to AI menus, allows these restaurants to get the most out of guest orders and even encourage customers to order more food based on data-informed suggestions.
The Beef Over Popeye’s Chicken Sandwich 🐔
- Popeye's newest menu item looks incredibly similar to Chick-fil-A's most popular menu item.
Who knew the next fast-food rivalry would be between Chick-fil-A and Popeye’s?
While Chick-fil-A doesn’t have the only chicken sandwich on the market, the fast-food restaurant has some incredibly loyal fans. Chick-fil-A has retained the highest customer satisfaction score for years. It also claims the highest score of any chain, full-, or limited-service restaurant.
That was, until the shrimps at Popeye’s made a play for their bread and butter (or in this case, their chicken and pickle) with the introduction of their new chicken sandwich. It has been less than two weeks since the Popeye’s chicken sandwich has been released. Though it still hasn’t debuted at every location Popeye's location, the internet is nonetheless caught in a meme war to determine the true chicken-dinner winner.
Why These Trends May Impact Your Restaurant Operations
- Be Ready for Business: More money spent in the restaurant sector means a potential increase in customers, busier tables, and more opportunities to grow. But all of that disappears if you have a staff that isn't trained. Use this restaurant training manual to help you keep up with increased restaurant spending - because you can't run a great restaurant without employees who know what they're doing.
- Think about Tech Adoption: When's the last time you updated your tech stack? Maybe it's time to adopt new payment or mobile ordering technology. The ability to take orders and payments at the table with a handheld device significantly decreases the time it takes to fulfill orders and complete the payment process. With handheld tablets, your servers are not running back and waiting in line for the central terminal. The faster you can turn tables, the more customers you can serve at your busiest hours, and that means more revenue overall.
- Focus on MenuTrends: While getting into the chicken sandwich game might be a fun way to take advantage of viral marketing, it's okay to think smaller as well. Take a look at what menu items are trending in restaurants around you, or even on your own menu. Have you had a special sell-out recently? Maybe you should consider moving it to your regular menu. Keep an eye out for trending ingredients in your city, and get creative.