It’s the end of the year, so let’s recap the four biggest restaurant industry stories of 2017.
Sexual Harassment Comes into Focus
This was a popular topic among our subscribers last year and the theme really blew up in the latter half of 2017. You’d have to be living under a rock to not have at least heard about the #MeToo movement that has already taken down several politicians. But it’s also hit the restaurant industry particularly hard – and for good reason.
Several top chefs and restaurant operators have had to step away from their business over sexual misconduct allegations. Among the list – Mario Batali, John Besh, Ken Friedman, Johnny Luzzini. Even McCormick & Schmick’s is also being sued by employees for sexual harassment issues.
Straight up: The restaurant industry (full-service, especially) has more claims of sexual harassment than any other industry. That’s atrocious and we can do better. But the only way things will get better is with a serious culture shift.
The restaurant industry has a severe sexual harassment problem. The question is: what will operators do to make the work environment safe for all their employees?
Fighting the Wage Gap
Bridging the wage gap gained weight in 2017, thanks in part to the continued efforts of #Fightfor15 and Bernie Sanders followers. Front of house staffers earn an average of $25 while back of house half that at $13.
The Trump Administration is hoping that a rollback to allow tip-pooling will help ease the burden on restaurant operators. Tip-pooling optimists like the idea of letting restaurant operators collect and distribute tips among all staff – front and back-of-house alike. But skeptics are afraid restaurant operators will pocket the cash for themselves.
Meanwhile, other restaurants are still experimenting with no-tipping policies, paying staff higher starting wages, and charging service fees to make up the difference. There’s been a mix of success.
Sadly, raising the minimum wage hasn’t helped restaurants with their other big issue – staff retention.
Chain Restaurants Begin to Crumble
2017 was not a kind year for a lot of chain restaurants. In fact, many chains saw dramatic traffic and revenue drop this year. Some closed up shops to stay afloat while others got put on the selling block.
- Applebee’s closes up 135 locations
- My Fit Foods closes all their units
- Pie Five Pizza Co. closes nine locations
- Bloomin’ Brands closes 43 restaurants
Mergers & Acquisitions:
- Bob Evans Restaurants was bought for $565 million
- Panera Bread was bought for $7.5 billion
- Arby’s buys Buffalo Wild Wings for $2.4 billion
Overall, traffic has dropped among restaurants but check totals have risen. The higher checks, for now, is offsetting loss of guests, but there’s only sustainable for so long. 2017 was a murky year for restaurants as a whole, but some individual brands saw success.
Politics: Restaurants Unwanted Guest
Bars and restaurants have always been cultural centers for exchanging ideas, but the current political climate in the US has that becoming more of a bug than a feature.
The biggest of all these related stories is, by far, Papa John’s. Founder John Schnatter got raked over the coals after he blamed the anthem kneeling during NFL games for Papa John’s sluggish sales. This wasn’t the first time Schnatter’s political views came with a hit.
Spot of Tea got a wave of intense backlash after announcing it would host popular conservative cable TV show Fox & Friends. The owner, Tony Moore, said he’s apolitical and doesn’t vote in elections. However, he also said he has traditionally experienced “tremendous support” from the city’s LGTBQ and black community, so the backlash shouldn’t come as too surprising.
Restaurant owners who truly want their business to stay apolitical should be wary of groups they publicly support and how it may be interpreted by their guests. Either way, it’s good to not alienate your guests.
What will 2018 bring? Stay tuned for our 2018 restaurant predictions post later this month