The restaurant industry is changing and it’s never going back. The independent operator is faced with overwhelming pressure from both customers and employees. Customers’ expectations are rapidly evolving and the time and expense to keep up is shrinking profits. The constant need for quality help and the declining number of applicants has employers stuck between a rock and a hard place. Operators need to choose which is most important; quality, speed, or service because each has an uniqe value to the operation. There is good news, once a choice has been made all other challenges become easier.
The hospitality landscape has been changing bit by bit over the past couple of decades. We’ve seen the invention of QSR’s, take-out availability, social media marketing, third-party delivery services, and mobile ordering. These aspects are not new, in fact they’ve been a part of the restaurant industry years before Covid. Many will claim that Covid changed the restaurant industry, it was already changing, Covid just sped up those changes. So how has this impacted customer expectations? Before we answer this question, we have to address the real question. What is the industry going to look like in 5 to 10 years? I’m suggesting that instead of reacting to current demands let’s predict future demands and be prepared to meet those.
As of July 2020, the current age demographics has the millennial generation the largest in the United States. These 18–35-year-olds represent the largest consumer spending since the baby boomers. Now consider 10 years in the future, these individuals will have already completed college and approximately 10 years into their career. These same individuals have never experienced life without immediate access to information. They crave new ideas and experiences and are willing to take a chance on something unique. This is the reason that this demographic is the greatest user of meal delivery services. I theorize what they value most is quality and efficiency. Not to say that service isn’t important, it’s not first in their priorities when making buying decisions. This shift has already occurred in the retail industry. Is there any reason why we can’t assume it is going to happen to restaurants too? Many corporate entities have already identified this in anticipation of the future by incorporation of technology. Many companies started the implementation of technology with ordering apps, kiosks, and table side devices. At the time this is written, only corporate facilities have moved their chips to an “all-in”, it’s time for the independents to catch up.
Finding quality employees is more difficult than it has ever been. There are 3 factors that contribute to the current system, and none are governmental or covid related. Finding good help has always been a challenge for any restaurant manager. There has always been governmental assistance and individuals had support if they didn’t want to work. Operators need to stop blaming their inability to find help on these issues. Let’s look at the age group that makes up most of the transient employees in the restaurant. These are employees that do not have a career path or the path is not in the hospitality industry. Typically we see they are between the ages of 18-28, adults but not with a significant amount of responsibility. Now, what do they want? They want the flexibility to set their own schedule, they want the most efficient use of their time, and want to be compensated for attendance. So, who are they? Millennials, that’s who. Don’t misinterpret what I’m saying. I’m not saying that Millennials cannot become employees, I’m saying the techniques used to attract and identify new employees are outdated. I’m saying the methods used to keep current staff loyal and motivated has changed and the entire process needs to be reevaluated.
Where to begin? If flexibility is what they desire, then create a system that allows for such. Your business is capable of identifying when the peak of sales are and when employees need to be available. Try offering incentives for those peak periods. What is most critical to the success of that shift and so on, prioritize and analyze the data to determine what is financially prudent. Determine consequences should employees fail in attendance and inform applicants before they are hired. Create goals or tiers for employees to obtain higher compensation for success.
Like I said earlier, there is good news. Once you have determined what characteristics are most important to the profitability of your restaurant, then the directions regarding customers and employees becomes clearer. I think it is important to identify that the characteristics are going to differ between concepts. What is important to a casual dining establishment will not have the same importance to a quick serve restaurant. These we refer to as Key Performance Indicators (KPI’s) which are metrics that are used to evaluate performance of the unit. All decisions moving forward are evaluated against the potential impact on the KPI’s. The combined efforts of analytics, customer perception and employee relations will help independent operators maintain a successful business and thrive during periods of chaos.
