Delivery

AI-generated image of a person carrying takeout bags from restaurant to their motorcycle
by David Klemt David Klemt No Comments

Is Demand for Delivery Down?

Is Demand for Delivery Down?

by David Klemt

AI-generated image of a person carrying takeout bags from restaurant to their motorcycle

I have done this. Cargo straps required.

Not too long ago, it seemed as delivery was going to overtake people’s desire to enjoy a restaurant in person, but that trend may be on a downward swing.

At first, this trend made perfect sense, for obvious reasons. For a while, the best way for consumers to enjoy their favorite restaurants and show support was to order delivery.

Rideshare companies jumped on delivery, as did several platforms. When guests were able to visit restaurants in person freely, delivery had become a habit for many of them. In fact, ordering delivery had become the de facto method of engaging with restaurants for a not-insignificant percentage of people.

However, operators and their teams weren’t shy about exposing their delivery “partners.” I think it’s fair to describe the fees operators were being charged by some of these partners as outrageous.

When the public found out about these fees, they didn’t sit well. Takeout, carryout, takeaway, order for pickup… Whatever your preferred nomenclature, people began seeing it as superior to delivery. This shift in consumer behavior was driven by a desire to support their favorite restaurants.

Of course, there are other factors that affected people’s move away from delivery. I’m confident in saying that most of us who have ordered delivery at some point in the last couple of years has experienced at least one of several downsides.

However, has delivery really fallen out of favor? Have takeout or drive-up pickup actually been passing up delivery?

Datassential’s 2024 Midyear Trends Report has some insights that can answer those questions. You can (and should) check it out for yourself here.

The State of Takeout and Delivery

To obtain a snapshot of the state of the performance of delivery and takeout, Datassential conducted a survey in May of this year. The F&B intelligence platform surveyed 400 US operators and more than 1,500 US consumers.

According to Datassential, nearly half of restaurant operators reported increases in guests dining in person at their restaurants.

Perhaps more telling, however, is that Datassential’s survey reveals that half of restaurants aren’t even offering delivery. I don’t know the breakdown of operators who once offered delivery and stopped doing so versus operators who never offered delivery.

What I do know is that there are, as I alluded to up top, many reasons for people to eschew delivery. Chief among these are cost, and the condition of the order when it arrives to the guest.

On the operator side, cost is once again a consideration, as are negative reviews and complaints. More than one study has shown that operators often get the blame when a third party botches an element of the delivery. These complaints can include food being delivered lukewarm or cold, parts of the delivery missing, or the wrong items being delivered to someone.

But, again, is demand for delivery slipping?

Per Datassential’s report, takeout and catering are outpacing the growth of delivery for US operators. Almost 40 percent of operators who participated in Datassential’s survey reported an increase in frequency for takeout and catering orders. In comparison, just 20 percent of respondents ordered an increase in delivery order.

Just eight percent of operators indicated a decrease in takeout and delivery. In fact, the greatest decrease impacts catering (14 percent), according to Datassential’s report.

Takeaway

Delivery, simply put, doesn’t work for every operator or every concept. Moreover, it looks like consumer desire for takeout is on a greater upswing in contrast to delivery.

For concepts that succeed with delivery, it’s imperative that operators control the process rather than cede to third parties, in my opinion.

The best way forward will vary from business to business. Operators and their teams need to be ruthless the quality, consistency, accuracy, and value of all orders, whether placed in person, for takeout, or for delivery. Further, when it comes to takeout and delivery, the ordering process must be convenient.

What’s clear is that every operator needs to dive into their data, determine how guests prefer to order from their restaurant, and pursue those preferences to enhance the guest experience.

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An Xbox One controller sitting on a Scorpion Gaming mouse pad
by David Klemt David Klemt No Comments

Game On: Datassential’s Midyear Report

Game On: Datassential’s Midyear Trends Report

by David Klemt

An Xbox One controller sitting on a Scorpion Gaming mouse pad

Brought to you by Xbox, Scorpion Gaming, and cool photography.

The 2024 Midyear Trends Report released by Datassential earlier this month contains an intriguing revelation that savvy operators can leverage.

There is, of course, interesting and useful information throughout. After all, Datassential conducted a survey of 1,500-plus US consumers, along with 400 US foodservice operators.

Surveying nearly 2,000 people is going to garner some helpful insights.

For example, we know that many people are concerned with their nutrition. Along with that comes reading nutrition labels. However, US consumers appear to throw that behavior to the wayside when dining out.

According to Datassential’s survey results, 62 percent of consumers in the US read the nutrition labels on new items before selecting them for purchase at grocery stores. But nearly that same percentage of consumers, 58 percent, don’t consider diets or nutrition when choosing where they’re going to eat.

What that says to me is that people still viewing dining out as a treat or an occasion. Most people, when treating themselves and others, see it as an escape. An escape from the stresses of work, of life, and from eating “boring” foods.

People are still driven to leave home to gather, socialize, and have fun. And restaurants and bars still play a major role in meeting those needs and desires.

Negative and fear-mongering stories may be getting all the clicks, but Datassential’s findings are much less on the doom-and-gloom side of the equation. Per their midyear report, nearly 90 percent of US restaurant operators have seen increases in traffic (46 percent) or had their traffic remain the same (42 percent) so far this year. Just 12 percent of operators reported decreases in traffic, according to Datassential.

Game On

Now, let’s look at the data in this report that really caught my attention.

The Datassential report reveals that 61 percent of survey respondents play video games. Citing Entertainment Software Association data, close to 200 million Americans are gamers. Going further, gaming spans all ages. Last year, gamers spent well over $50 billion on this particular hobby. MarketWatch claims even combined, the global sports and movie industries don’t outperform video games financially.

Of all respondents to the Datassential survey, a quarter aren’t gamers, and 15 percent “used to” play video games. That latter group consists mainly of Gen Xers. And, hey, fair enough—some people don’t enjoy or have time for video games.

In contrast, however, 23 percent of survey respondents label themselves “avid gamers.” Gen Z, Millennials, and men make up the majority of this group of consumers.

Almost 40 percent (38%) classify themselves as “casual.” This group consists mainly of Gen X, Gen Z, and women.

Alright, so…what does this have to do with restaurant operators? Well, gamers spent $57 billion just on video games. Per Datassential, 45 percent of survey respondents have made F&B purchases after consuming video game-related ads or content. This is true of 63 percent of US Gen Z consumers, and 56 percent of US Millennials.

These stats tell me that gaming pays not just for console manufacturers and game producers, but also for F&B operators. It would seem to me, then, that operators with concepts that can leverage video games in an authentic manner should give strong consideration to doing so.

So, game on?

Image: Jose Gil on Unsplash

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"2024" dessert concept
by David Klemt David Klemt No Comments

Welcome Back to the Culinary Arena

Welcome Back to the Culinary Arena: A Comprehensive Guide for 2024

by Nathen Dubé

"2024" dessert concept

The start of a new year is an exciting time in the restaurant world, offering a unique opportunity to reassess and rejuvenate your foodservice business.

From utilizing downtime effectively to setting strategic priorities, this guide is designed to help you navigate the year ahead with confidence and creativity.

Whether you’re a seasoned chef or a budding restaurateur, these insights will equip you with the tools to make 2024 a year of remarkable culinary experiences and business growth.

Part 1: Strategic Use of Downtime

Menu Innovation and Optimization

The start of the year is ideal for re-evaluating your menu.

Begin by analyzing customer feedback and sales data from the previous year. Identify which dishes were most popular and which underperformed. Consider removing items that aren’t selling well and focus on the dishes that your customers love.

This is also an excellent time to experiment with new flavors and culinary trends. For instance, with the growing demand for plant-based options, think about introducing a few vegan or vegetarian dishes.

Keep an eye on food trends. Are there new ingredients or cooking techniques that you can incorporate into your menu? This not only keeps your offerings fresh and exciting but also shows your commitment to culinary innovation.

Remember, a well-crafted menu is a balance between popular staples and innovative dishes. It should reflect your restaurant’s identity while also appealing to your target customer base.

Consider a seasonal menu that takes advantage of fresh, local produce, which can provide inspiration for new dishes and help reduce costs.

Staff Training and Empowerment

The quieter months are a perfect opportunity for staff training and development.

Conduct a skills audit to identify areas where your team could improve or learn new competencies. This could range from culinary skills, like mastering a new cooking technique, to soft skills, such as guest service or conflict resolution.

Training doesn’t have to be formal or expensive. You can leverage online courses, in-house mentoring, or even cross-training within your team.

For instance, front-of-house staff could benefit from basic kitchen training to better understand the dishes they are serving, while kitchen staff could learn about customer service to appreciate the end-to-end dining experience.

Team building is another key aspect. Organize activities that foster communication and collaboration. This could be something as simple as a team meal or a group outing.

A cohesive team that communicates well will provide better service, leading to happier guests and a more pleasant working environment.

Finally, empower your staff by involving them in decision-making processes. This could be in menu development, process improvements, or even marketing ideas.

When staff feel valued and part of the business, they are more likely to be motivated and committed.

Facility Revitalization

Use this quieter period to assess and upgrade your facilities.

Start with a thorough cleaning and maintenance check. This includes checking kitchen equipment, dining area furniture, and the overall infrastructure of your establishment.

Evaluate your kitchen equipment and consider if anything needs to be repaired or replaced. Upgrading to more efficient equipment can improve productivity and reduce long-term costs. For instance, investing in energy-efficient appliances not only cuts down on utility bills but is also better for the environment.

Look at your dining area from a customer’s perspective. Is the seating comfortable? Is the lighting appropriate? Small changes in décor can significantly enhance the dining experience. Consider refreshing the paint, adding new artwork, or even rearranging the layout to improve flow and ambiance.

Also, think about your back-of-house operations. Is your storage area organized? Can you improve the workflow in the kitchen? An efficient back-of-house leads to smoother service and a better customer experience.

Part 2: Setting Priorities for the Year

Elevating Customer Experience

The guest experience is paramount in the food service industry. This year, make it a priority to enhance every aspect of your guest’s journey.

From the moment they walk in, to the service they receive, to the food they enjoy, each element should contribute to a memorable experience.

Focus on training your staff to provide exceptional service. This includes being knowledgeable about the menu, attentive to guest needs, and quick to resolve any issues.

Personalized service can make a big difference. Remembering regulars’ preferences or celebrating special occasions with them can turn a one-time visit into repeat patronage.

Ambiance plays a crucial role in the dining experience. The right music, lighting, and décor can create an inviting atmosphere that complements your culinary offerings. If your budget allows, consider investing in upgrades that enhance the ambiance, such as new lighting fixtures or comfortable seating.

Implementing a feedback system is also important. Encourage customers to share their experiences, whether through comment cards, online reviews, or direct conversations. This feedback is invaluable for continuous improvement and can help you address any issues promptly.

Sustainability as a Cornerstone

Sustainability is becoming increasingly important to consumers, and incorporating sustainable practices into your business can have a significant impact. Start by assessing your current practices and identifying areas for improvement.

One key area is waste reduction. Conduct a waste audit to understand where most of your waste is coming from and develop strategies to reduce it. This could involve better inventory management to prevent overordering and spoilage, composting food waste, or finding creative ways to use leftovers.

Local sourcing is another aspect of sustainability. Building relationships with local suppliers not only supports the local economy but also reduces your carbon footprint. Local ingredients are often fresher and can inspire seasonal menus.

Also, consider the sustainability of your operations. This could involve using eco-friendly packaging, reducing energy consumption, or even installing water-saving devices.

Communicating your sustainability efforts to your customers can also enhance your brand’s image and attract environmentally conscious patrons.

Innovative and Integrated Marketing Strategies

In today’s digital age, effective marketing is crucial for any business.

Utilize social media platforms to engage with your audience. Share behind-the-scenes glimpses of your kitchen, showcase your signature dishes, and highlight your team. This not only promotes your offerings but also builds a connection with your guests.

Email marketing is another powerful tool. Regular newsletters can keep your guests informed about new menu items, special events, or promotions. Personalized emails on birthdays or anniversaries can make your guests feel special and encourage repeat visits.

Don’t overlook the power of community involvement. Participate in local events, collaborate with other businesses, or sponsor local sports teams. This can increase your visibility in the community and build goodwill.

Financial Health and Diversification

Keeping a close eye on your financials is crucial.

Regularly review your costs and revenues and look for ways to optimize them. This might involve renegotiating supplier contracts, adjusting menu prices, or reducing unnecessary expenses.

Consider diversifying your revenue streams. This could include offering catering services, hosting private events, or selling branded merchandise.

These additional streams can provide a buffer during slower periods and increase your overall profitability.

Conclusion

As we look forward to 2024, let’s embrace the opportunities and challenges that come our way.

By using downtime strategically, setting clear priorities, and striving for excellence continuously, we can ensure that this year is not just successful but also fulfilling.

Remember, in the dynamic world of foodservice, adaptation and innovation are key. Let’s make this year a celebration of our culinary passion, business acumen, and commitment to our guests.

Here’s to a year of delicious discoveries and unparalleled success in the culinary world!

Image: 愚木混株 cdd20 on Unsplash

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A veritable sea of pickle chips
by David Klemt David Klemt No Comments

Grubhub Reveals 2023 Order Trends

Grubhub Reveals 2023 Order Trends

by David Klemt

A veritable sea of pickle chips

Just under the wire Grubhub releases their annual end-of-year report, revealing their customers’ top ordering trends of 2023.

Uber Eats and DoorDash unveiled their reports at the end of October and start of November, respectively.

To revisit 2022 for a moment, the top food item ordered via Grubhub was the burrito. So, the unofficial theme of last year’s annual report was warmth and comfort wrapped in layers.

I’m providing that context because this year’s report also comes with a theme. This year, it’s “doing it for the vibes.” For Grubhub, this means that users of the service broke out of their comfort zones to try new F&B items.

Providing an example, one of the standout trends for 2023 is heat. As in, Grubhub users added spice to quite a lot of orders, as you’ll see below.

Click here to review Grubhub’s top 2022 food orders, and here for their 2022 beverage orders. To review this year’s Grubhub report in its entirety, click here.

Now, let’s take a look at a number of this year’s ordering trends.

Soft Drinks & Coffee

Usually, I start with food items when reviewing these reports. Well, once you become predictable, you become beatable. So, I’m going to shake things up and begin with beverages.

According to Grubhub, a TikTok trend—#dietcokebreak—is responsible for the growth of Diet Coke on the platform. In fact, the third-party delivery service says that in-office orders of Diet Coke grew by 17 percent. No surprise, then, that the soda grabbed the top spot in 2023.

Top 5 Sodas

  • Diet Coke
  • Coke
  • Sprite
  • Dr. Pepper
  • Ginger Ale

Next, coffee orders. Per this year’s Grubhub report, people weren’t shy about ordering coffee outside of the breakfast and lunch dayparts.

According to their data, more than 10 million coffee orders were placed after 5:00 PM.

Top 5 Coffee Orders

  • Iced Coffee
  • Caramel Frappe
  • Mocha Frappe
  • Cappuccino
  • Hot Coffee

Food & Flavors

Here’s an interesting revelation: more than 600,000 Grubhub users chose to order salads with a side of French fries.

In fact, the French fry is the top ordered side in 2023 on the platform. So, Grubhub ranked fries by style.

Top 5 French Fry Styles

  • Classic cut
  • Waffle fries
  • Cheese fries
  • Sweet potato fries
  • Curly fries

Hey, let’s reignite the pineapple on pizza debate. According to Grubhub’s year-end report, pineapple as a pizza topping grew by 33 percent in comparison to 2022.

However, Hawaiian pizza has some more growth to do if it wants to take the number one spot.

Top 5 Pizza Styles

  • Cheese Pizza
  • Margherita Pizza
  • Pepperoni Pizza
  • Buffalo Chicken Pizza
  • Hawaiian Pizza

Finally, top flavors. In short, heat is a hit.

Grubhub users added spice to a staggering 53 million orders this year. For further context, sriracha was added to more than 91,000 orders.

And when it comes to chicken wings, Buffalo was the dominant style. I find it interesting, though, that no style of wing made the top five for this category.

Top 5 Spicy Items

  • Spicy potato soft tacos
  • Spicy chicken sandwich
  • Spicy tuna roll
  • Hot and sour soup
  • Drunken noodles

Bringing this report to a close, the item with the most growth. Pickles grew by 89 percent in 2023, accounting for 6.9 million orders.

So, I guess make sure your pickles, French fries, cheese pizzas, and salads are on point as we head into the New Year.

Image: Nathan Dumlao on Unsplash

Canada and the United States of America on a globe
by David Klemt David Klemt No Comments

2023 DoorDash Ordering Trends

2023 DoorDash Ordering Trends: Canada & US

by David Klemt

Canada and the United States of America on a globe

After checking out this year’s annual Cravings Report we’re turning our attention to the 2023 DoorDash restaurant ordering trends reports.

Luckily, there are two reports available from DoorDash: one that focuses on Canada, and one for the US.

These two countries are, of course, KRG Hospitality’s primary markets. So, the data in these DoorDash reports is relevant and compelling for our current and future clients.

Perhaps unsurprisingly, Canadian and American DoorDash users are somewhat similar by a few metrics. However, where there are differences they’re fairly glaring.

For example, 78 percent of Canadian DoorDash survey respondents picked up a takeout order from a restaurant in the month prior to being surveyed. That number is 76 percent for American survey respondents.

Regarding in-person restaurant dining, 62 percent of respondents had done so the month prior. Among American survey respondents that number is 61 percent.

But when it comes to placing an order for delivery we see a notable difference. For Canada, 58 percent of survey respondents had ordered delivery. That number jumps to 77 percent among Americans.

This tells me a few (fairly obvious) things. Generally speaking, it appears consumers in Canada and America—according to DoorDash—prefer delivery and takeout to in-person dining. Going further, it seems that overall, Canadians prefer pickup or takeout to delivery. However, Americans seem to place delivery and pickup orders at nearly identical rates.

If it’s true that consumers favor delivery or takeout to in-person dining currently, there could be a couple of simple reasons. First, convenience.

Second, fees. It’s possible that today’s consumer perceives delivery fees are lower than in-person dining fees, unfortunately. If that’s the case, third-party delivery services can exploit this perception.

More Similar than Different

In comparing both DoorDash reports, I find that Canadian and American consumers who use DoorDash are rather similar.

Survey respondents in both countries indicate that Friday is the most popular day of the week to order food. Further, 6:00 PM is the most common local time to place orders in both countries.

And when it comes to the fastest-growing dayparts for order placement? In both Canada and the US it’s late-night and breakfast. Although, I most note that both dayparts are growing faster in Canada.

Nearly half of American respondents and a little over half of Canadian respondents indicate they want to try new restaurants and dishes.

Definitely not surprisingly, consumers in both countries primarily focus on menu selection and pricing when seeking a new restaurant to try. In fact, these numbers are identical for Canadians and Americans, at 55 percent and 51 percent, respectively.

Top Canadian Food Orders

When we look at the top items ordered via DoorDash, we don’t find anything out of the ordinary.

  1. Burgers
  2. Fries
  3. Pizza
  4. Salad
  5. Sandwiches

Looks like standard fare and comfort foods to me. This tells me that operators who have these items on their menus need to ensure they’re of the highest quality to stand out from other restaurants and bars.

Top American Food Orders

Interestingly but not too surprisingly, the list below is quite similar to the list above.

  1. French fries
  2. Burgers
  3. Tacos
  4. Salad
  5. Pizza

With the exception of tacos and sandwiches, the list is nearly identical.

Hey, who wants to debate whether tacos and sandwiches are in the same food family?

I encourage you to review both reports in their entirety for yourself. For the Canadian Edition of DoorDash’s report, click here. And click here for the US edition.

Image: Lara Jameson on Pexels

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Kentucky Fried Chicken packaged for delivery or pickup
by David Klemt David Klemt No Comments

2023 Cravings Report: “The Most” Orders

2023 Uber Eats Cravings Report: “The Most…” Orders

by David Klemt

Kentucky Fried Chicken packaged for delivery or pickup

Let’s take a look at the top orders, delivery requests, order combinations, surprising pairings, and more from the 2023 Uber Eats Cravings Report.

It appears that the chicken sandwich dominance we’ve seen over the years is winding down. At least, that seems to be the case among Uber Eats users.

As you’ll see below, not only is the chicken sandwich not the most popular item, it’s not even among the top five. It does edge out the cheeseburger and wings among the most popular combos, but it doesn’t outperform French fries and salt as a combo.

Another eyebrow-raising detail? Pizza doesn’t show up anywhere among the most ordered items, most popular combos, or even the most surprising combos.

Now, if you’re curious about the 2022 Uber Eats Cravings Report, you’re in luck. You can click here for the top food orders from that report, and here for the top beverage orders.

The Most…Ordered Items

  • French fries
  • Garlic naan
  • Pad Thai
  • Miso soup
  • California roll

Am I the only one who expected to see burgers, chicken sandwiches, and pizza on this list?

The Most…Popular Combos

  1. Burrito bowl + cheese
  2. French fries + salt
  3. Chicken sandwich + shredded lettuce
  4. Cheeseburger + mustard
  5. Wings + ranch

Fairly standard, really. Every one of these orders makes complete sense. Now, the category coming up next…it’s a different story.

However, before we move on, let’s compare these items to those found on the 2022 Uber Eats Cravings Report.

Interestingly, the number-one item is nearly identical: burrito + cheese. And French fries + salt is the second most-popular item on both lists.

The Most…Surprising Combos

  1. Steak + jelly
  2. Cottage cheese + mustard
  3. Condensed milk + avocado
  4. Seaweed + pasta sauce
  5. Butter + pickled onions

I really have nothing to say after reviewing this short list. I mean…hey, do your thing, everyone. Make your order yours.

To the operators out there, be ready for some odd order combos.

The Most…Popular Requests

  1. No onions
  2. Dressing on the side
  3. Ranch
  4. Extra soy sauce
  5. Spicy
  6. Sauce on the side
  7. No lettuce
  8. No jalapenos
  9. Extra gravy
  10. No slaw

Looking at the top request, Uber Eats has a theory as to what’s driving it: the return to the office.

People, it appears, are self-conscious about their breath in an in-person, face-to-face setting.

The Most…Popular Food and Alcohol Combos

  1. Ribeye + Vodka
  2. Cheeseburger + Frozen Margarita
  3. Chicken + Frozen Piña Colada
  4. Lobster tail + Apple whiskey
  5. Tamales + Daiquiris

Last year’s report reveals the following combos:

  1. Steak + Margaritas
  2. Pizza + White Claw
  3. Burritos + Margaritas
  4. Chicken + Sangria
  5. Wings + Beer

Overall, a lot of change from the 2022 Cravings Report to this year’s report.

Image: Nik on Unsplash

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"Tax Man" graffiti on red brick wall
by David Klemt David Klemt No Comments

IRS Proposes New Tip Reporting Program

IRS Proposes New Tip Reporting Program

by David Klemt

"Tax Man" graffiti on red brick wall

The Internal Revenue Service is proposing a voluntary tip reporting program which they’re calling the Service Industry Tip Compliance Agreement (SITCA).

Making the announcement via Notice 2023-13 back in February, the IRS is giving people the chance to comment on the SITCA proposal.

Per the IRS, their intention is to “take advantage of advancements” in POS, scheduling, and e-payment technology. How do they intend to leverage all this tech? In short, the IRS is proposing that POS systems will have to process payments and tips in the same way.

To clarify further, if someone pays by credit card, they’ll have to tip via credit card. If a guest pays in cash, they’ll have to tip in cash. So, should SITCA become the industry standard, the days of paying with a credit card but leaving a cash tip will be over.

However, in my eyes, this isn’t a simple “modernization” of IRS processes.

If the IRS is proposing a new for businesses to process tips, they’re looking to catch non-compliant businesses and tipped workers. A likely culprit or contributing factor to this IRS scrutiny? The retail venues now asking for or suggesting tips when customers check out.

So, it would be wise to reiterate to your team the need to report tips accurately. And remember, business owners need to ensure they’re complying with tip reporting as well. Getting flagged for inaccurate reporting is a great way to catch an audit, penalties, and a huge bill.

Nuts and Bolts

According to the IRS, SITCA will reduce taxpayer burdens. And, of course, the service claims the program will also reduce their own administrative costs.

Additional “features,” per the IRS website, are as follows:

  • The monitoring of employer compliance based on actual annual tip revenue and charge tip data from their point-of-sale system. There will be allowance for adjustments in tipping practices from year to year.
  • Participating employers demonstrate compliance with the program requirements by submitting an annual report after the close of the calendar year. This reduces the need for compliance reviews by the IRS.
  • Employers participating in SITCA will receive protection from liability under the rules that define tips as part of an employee’s pay for calendar years in which they remain compliant with program requirements.
  • Participating employers have flexibility to implement employee tip reporting policies best suited for their employees and business model. Policies must be in accordance with the section of the tax law that requires employees to report tips to their employers.

Requests for Comment

Interestingly, Notice 2023-13 contains a request for comments in four specific areas:

  • By what means a technology-based time and attendance system may be used by tipped employees to report tips. This includes tips in cash and other forms of tipping made through electronic payments methods (other than a credit card), regardless of whether the tips are received directly from customers or through tip sharing arrangements.
  • How tip sharing practices vary across service industries and how the SITCA program can support employer participation while accommodating potential differences in Federal, state, and local labor and employment law requirements.
  • By what methods employers of large food or beverage establishments participating in the SITCA program may meet their filing and reporting obligations under section 6053(c) and also satisfy the SITCA program requirements for compliance, while minimizing the administrative burdens on taxpayers and the IRS.

Those interested in providing such feedback have until May 7, 2023 to do so. The IRS has set up two ways to provide comments on Notice 2023-13:

  • Mail: CC:PA:LPD:PR (Notice 2023-13), Room 5203, Internal Revenue Service, P.O. Box 7604, Ben Franklin Station, Washington, D.C. 20044; or
  • Electronic: Visit the Federal eRulemaking Portal at www.regulations.gov (indicate IRS and Notice 2023-13) and follow the instructions for comment submission.

Personally, I have more questions than comments. Bear in mind, the IRS will stop accepting comments, feedback, and questions on May 7, 2023.

Image: Jon Tyson on Unsplash

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Wood-fired pizza on paddle
by David Klemt David Klemt No Comments

Slice Releases 2023 “Slice of the Union”

Indie Pizzeria App Slice Releases 2023 Report

by David Klemt

Wood-fired pizza on paddle

The annual Slice of the Union report from independent pizzeria ordering app Slice offers excellent insight into the indie pizza space.

Per the company’s website, Slice serves all 50 states and works with 19,000 pizzerias. For context, that’s a network of pizzerias more than double in size in comparison to Domino’s.

In my opinion, then, the company is well-positioned to deliver data regarding the indie pizzeria space.

Additionally, Slice says they save independent operators money. To date, Slice claims partners have saved more than $265 million in fees that would have gone to third-party delivery services.

In part, that’s due to a 2021 innovation by the company. At the International Pizza Expo in Las Vegas in August of 2021, Slice unveiled fixed-price, tiered packages for partners.

 

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Essentially, Slice intends to help local, indie pizzerias boost their reach, discoverability, and revenue. The company’s mission is “empowering independent pizzerias.” In part, Slice accomplishes their mission to “Keep Local Thriving” by offering indie pizzeria operators access to technology and services that rival the big pizza chains.

Below you’ll find some of the insights from the 2023 Slice of the Union that most stand out to me. To review the report in its entirety yourself, please click here. Not only is it an informative read, it’s actually fun.

Ordering Occasion

Kicking things off, ordering occasions. As all operators should know, many guests seek out particular cuisine, drinks, or venues dependent upon their dining or drinking occasion.

In the 2023 Slice of the Union, Slice takes a look at a couple occasions that motivate people to order pizza: sports and awards shows.

Now, it’s no surprise that people order pizza to enjoy while watching sports. So, since that’s common knowledge, Slice goes deeper and identifies the top sports leagues:

  1. Football
  2. Basketball
  3. Baseball
  4. Hockey

No mention of my two favorites, F1 and MotoGP, but at least hockey makes the cut. (My Vegas side says, “Go Knights!” but my born-in-Chicago side says, “Go ‘Hawks!”)

When we look at awards shows, the top spot may be somewhat of a surprise:

  1. People’s Choice Awards
  2. Tony Awards
  3. Emmy Awards
  4. Golden Globes
  5. The Oscars

Interestingly, the Grammys only manage an honorable mention. And there’s something poetic about pizza being the “people’s choice” for the People’s Choice.

Another bit of compelling data. Slice says that most people buckle and give up on their New Year’s resolution to keep away from pizza on January 13.

What’s in a Name?

There are certainly some creative pizzeria names out there.

However, Slice identifies not just some of the most common names but how many pizzerias use them:

  1. Joe: 206 pizzerias
  2. Sal: 206 pizzerias
  3. Tony: 114 pizzerias
  4. Johnny: 56 pizzerias
  5. Ray: 43 pizzerias
  6. Nino: 21 pizzerias

Flavors on the Rise

Wondering what the top topping is? What Slice sees as the pizza trends to watch?

Well, Slice has the answers to those questions (and more) in their annual report.

Pepperoni, as Slice says, “is a classic.” So, it wouldn’t provide much insight to just say, “Hey, pepperoni is popular.” Operators who offer pepperoni—and why wouldn’t they?—are already aware of its ubiquity.

Instead, Slice identifies the topping that’s showing the most growth. Per Slice, mushrooms has shown up on 8.9 percent more pizzas. Also, ranch dressing showed up on 9.7 percent more pizza orders in 2022.

Now, which trends may gain more significant footholds in the pizza space this year? Slice identifies two in their report:

  • Roman-style pizza
  • Pickle pizza

A Roman-style pizza is thin crust and pushes the toppings out all the way to the edges. A pickle pizza features—shocker—pickles heavily. According to Slice, this style of pizza normally includes a garlic sauce and mozzarella cheese.

Again, you’ll want to check this report out for yourself as there’s much more useful information. Click here to read it now.

Image: Dylan Sauerwein on Unsplash

KRG Hospitality Restaurants & Cafes, 2023 icon

White robot hand
by David Klemt David Klemt No Comments

Infographic Shows Massive Tech Growth

Infographic Shows Massive Hospitality Industry Tech Growth

by David Klemt

White robot hand

An infographic from Brizo FoodMetrics puts the explosive growth of the hospitality industry technology landscape on display.

It appears that operators, once largely hesitant to embrace new technology, are seeking it out. So, too, it seems, are guests. Intriguingly, many guests expect restaurants, bars, and hotels to innovate technologically.

In a sign of this change, SpotOn is predicting 2023 to be the year when independent operators upgrade their POS systems.

And that’s just one area where tech companies are innovating for our industry. As their infographic shows, Brizo FoodMetrics identifies ten areas of innovation:

  • POS systems
  • Payment platforms
  • Online ordering solutions
  • Reservation and waitlist platforms
  • Inventory, accounting, and purchasing solutions
  • Human resources and staffing
  • Delivery, pickup, and drive-thru tech
  • Marketing, loyalty, and analytics platforms
  • Artificial intelligence, robotics, and automation
  • Ghost kitchen and virtual brand tech

Looking just at Brizo’s POS section, they list 48 platforms as part of their “2023 Restaurant Tech Landscape.” That’s four dozen POS systems, and that’s not even every platform available to operators.

Some will be familiar to operators—Toast, TouchBistro, Clover—as they’re basically synonymous with POS systems. Others, like Tillpoint and OVVI, may be less known. However, that doesn’t mean they’re not worthy of research and consideration.

Explosive Growth and Innovation

Again, the Brizo infographic doesn’t list every single available platform. For instance, I don’t see OpenSimSim under the HR/Staffing section. But the fact that there are still dozens of other platforms—more than in the POS section—shows that tech companies finally want their share of the hospitality pie.

This is, of course, beneficial for operators and their teams for several reasons. One such reason is innovation.

On one hand, the established platforms must innovate to fend off competitors. And on the other hand, upstarts must prove themselves to operators. In other words, new platforms must show they’re not vaporware; they have longevity and won’t abandon their own platform any time soon; they’ll update constantly; they’re simple to learn and use; they integrate with other systems; and that they’re worth an operator’s money and time.

We’re just two months into 2023. Imagine what the 2024 tech landscape is going to look like. And bear in mind, this is a restaurant-focused map—there are categories like property management systems for hotels that aren’t included.

If you’re in the market for a new POS system, want to upgrade scheduling, or are just curious about where the industry is heading, check out the infographic below. Select a few brands that are unfamiliar and look them up.

Brizo FoodMetrics 2023 Restaurant Tech Landscape

To view this infographic on the Brizo FoodMetrics website, click here.

KRG Hospitality Planning Phase, 2023 icon

Image: Possessed Photography on Unsplash

Shawarma stacked with fire in the background
by David Klemt David Klemt No Comments

Global Trends 2023: Technomic

Global Trends 2023: Technomic

by David Klemt

Shawarma stacked with fire in the background

Not content to focus solely on North America, foodservice research firm Technomic is predicting foodservice trends that will span the globe in 2023.

As the firm points out themselves, making predictions is a best-guess proposition. Many of Technomic’s 2022 predictions for Canada, the USA, and the globe have proven true. However, a handful of their trend predictions have yet to manifest.

Further, not all trends will work for all operators and their concepts. Chasing every passing fad or trend is great if you like to watch your costs spiral. Doing so is also an excellent way to confuse guests and stress staff.

So, when considering any trend, make sure it works with your concept, has some staying power, and will resonate with your guests. Speaking to that last point, this is one reason it’s crucial to collect guest data. Making important menu and guest-impacting operational decisions without data just doesn’t make sense.

When you’re done with this article, take a look at our examination of Technomic’s other predictions. The firm’s Canadian predictions are here. And you can read the American trends by clicking this link.

For your own copy of Technomic’s international trends report, click here.

Operations

For 2023, Technomic is making predictions that certainly appear plausible. A number of them pertain to operations.

Kicking things off, sustainability. Driven in part by the global impact of the pandemic, the health of our planet is top of mind for many people.

For example, Canada’s single-use plastics ban is now in effect. England plans to move forward with a similar ban by October of this year.

Alongside such bans, Technomic believes operators—small independents and global chains alike—will implement entire sustainability strategies. These will range “from packaging and restaurant operations to marketing and menu development.”

Does your concept have a dedicated pickup window? Perhaps a takeaway counter? Maybe even a drive-thru? If not, 2023 may be the year you make that change. Not only that, you’ll likely want to position them front and center.

Per Technomic, many consumers are done with delivery. From rising costs outweighing convenience to delivery failures, pickup may become more appealing. Pickup is still convenient, it’s less expensive, and the consumer is in control.

Additionally, many people are well aware of how costly third-party platforms are to operators. In fact, Technomic identifies these platforms and their fees as “the biggest industry villain” of 2023.

Menu

One of Technomic’s predictions is particularly enticing: Lebanese street foods. To clarify, the firm believes all manner of street foods from around the globe will perform well in 2023.

However, they feel Lebanon’s street foods will stand out from the rest. So, think shawarma, labneh, kibbe, and pickled vegetables. That last item, by the way, follows Technomic’s prediction that pickling and fermenting will be hot trends in the US and Canada.

Of course, there are other items that Technomic thinks will shine in 2023. If the firm is correct, there’s a new “holy trinity” to keep an eye on and consider for your menu: sushi, poke, and ceviche. According to Technomic, each performs very well when it comes to takeout.

Interestingly, the research firm suggests that this particular holy trinity will spawn new virtual brands. If Technomic’s predictions prove accurate, some of these brands will focus on fried chicken or plant-based versions.

Speaking to that last point, Technomic is predicting that plant-based will “evolve” in 2023. This evolution will focus on more traditional meat counterparts. Providing examples, Technomic suggests that avocado, modern takes on black bean patties, cauliflower, tofu, tempeh, and seitan will be this year’s plant-based rock stars.

Are this year’s 2023 Technomic predictions going to prove accurate? It’s far too early to tell. However, one thing I can say with confidence is this: their predictions are rooted deeply in data. When Technomic makes a “guess,” it’s always an informed one.

Click here to read Technomic’s report in its entirety.

Image: Slashio Photography on Unsplash

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Margarita with dehydrated citrus garnish
by David Klemt David Klemt No Comments

Top 2022 Grubhub & Uber Eats Drinks

Top 2022 Grubhub and Uber Eats Drink Orders

by David Klemt

Margarita with dehydrated citrus garnish

The year-end Grubhub 2022 Delivered and 2022 Uber Eats Cravings reports identify this year’s delivery order drink trends.

Last week, we dove into Grubhub and Uber Eats’ top food orders. If you haven’t already, read that article here.

This week we’re going to check out what drinks were most popular in 2022 for both platforms.

Top Grubhub Coffee Orders

People are still working from home, full- or part-time. So, it makes sense that consumers are placing coffee orders for breakfast, snack, and lunch dayparts.

  1. Iced Coffee
  2. Hot Coffee
  3. Iced Caramel Coffee
  4. Iced French Vanilla Coffee
  5. Frozen Coffee

Top Grubhub Milk Alternatives

Of course, with coffee orders come milk orders. And as you’re probably well aware, milk alternatives are only growing more popular with consumers.

So, below are the top milk alternatives among 2022 Grubhub users.

  1. Oat Milk
  2. Almond Milk
  3. Coconut Milk
  4. Soy Milk
  5. Cashew Milk

As a possible explanation for the dominance of oat milk, sustainability could be a driver. According to available data, producing a pound of oats is much more sustainable than producing one pound of almonds.

It’s believed that oats are more favorable when it comes to basically every measure of sustainability.

Top Grubhub Alcohol Orders

I can’t say that I’m shocked to find the Margarita is the top cocktail order. It is, after all, the long-reigning Queen of Cocktails.

  1. Beer
  2. Margarita
  3. Hot Sake
  4. Piña Colada
  5. White Wine (Sauvignon Blanc)

I’ll admit that I’m slightly surprised that a red wine isn’t among the top five.

Top Uber Eats Alcohol Orders

Interestingly—perhaps a bit frustratingly—Uber Eats took a different approach to identifying their top drinks.

Rather than dedicating space solely to alcohol orders, their top drinks are part of combinations. As in, the “most frequently paired food + alcohol” combos.

So, here’s their list in its entirety:

  1. Steak + Margaritas
  2. Pizza + White Claw
  3. Burritos + Margaritas
  4. Chicken + Sangria
  5. Wings + Beer

However, there’s another drink in the Uber Eats “most unexpected food combos” section:

  • Ham + Cream Cheese
  • Fruit Roll Up + Hot Cheetos
  • Pickles + Whipped Cream
  • Popcorn + Pickle Juice
  • Dark Chocolate + Tomato Salad
  • Pizza + Applesauce
  • Sushi + Ranch
  • Peanut Butter + Pizza
  • Cheese + Martinis
  • Watermelon + Mustard

Therefore, we can reasonably extrapolate that the top 2022 Uber Eats alcohol orders are the Margarita, White Claw, Sangria, beer, and Martini.

Takeaway

If we compare reports and look for similarities, we see that two drinks are at the top: beer and Margaritas.

Both make sense. Beer, in can, bottle, and growler forms, travels very well. That makes beer ideal for delivery where it’s legal.

And as far as Margaritas go, there’s a wide array of canned options available. Again, canned cocktails travel well for delivery. Of course, restaurants and bars can also obtain the equipment to prebatch and package their signature Margaritas.

Ideally, your POS system can run reports to identify which drink orders are most popular for your delivery customers. Also ideal: operators should take as much control over their business as they can, implementing direct delivery as long as it’s feasible.

So, look into direct delivery, run your reports, and take more control while reducing costs.

Image: Edward Howell on Unsplash

Single-use plastic straws and utensils
by David Klemt David Klemt No Comments

Canada’s Single-use Plastics Ban

How Canada’s Single-use Plastics Ban Affects Operators

by David Klemt

Single-use plastic straws and utensils

With a few exceptions, Canada’s ban on the manufacture, importation, and sale of single-use plastics is now officially in effect.

However, that doesn’t mean restaurant and bar operators need to worry about current inventories just yet. While the Single-use Plastics Prohibition Regulations are in effect, operators have a year to deplete their stocks.

SUPPR is a crucial element of Canada’s overall plan to combat pollution and reach a goal of zero plastic waste by 2030. The single-use plastics ban was announced in June of this year.

“We promised Canadians we would deliver a ban on single-use plastics. Today, that’s exactly what we’ve done,” said Minister of Environment and Climate Change Steven Guilbeault the day SUPPR was announced. “By the end of the year, you won’t be able to manufacture or import these harmful plastics. After that, businesses will begin offering the sustainable solutions Canadians want, whether that’s paper straws or reusable bags. With these new regulations, we’re taking a historic step forward in reducing plastic pollution, and keeping our communities and the places we love clean.

Now, six months later, it’s the law of the land.

What’s Banned?

Essentially, Canadian operators must evaluate everything they use for delivery and takeout or pickup. If any items are single-use plastic, they must be gone by December 2023.

Per SUPPR, the manufacture, importation, and sale of the following is prohibited:

  • Checkout bags designed to carry purchased goods from a business and typically given to a customer at the retail point of sale.
  • Cutlery includes:
    • knives
    • forks
    • spoons
    • sporks
    • chopsticks
  • Foodservice ware designed for serving or transporting food or beverage that is ready to be consumed, and that:
    • contains
      • expanded polystyrene foam
      • extruded polystyrene foam
      • polyvinyl chloride
      • carbon black
      • an oxo-degradable plastic
    • are limited to the following items
      • clamshell containers
      • lidded containers
      • boxes
      • cups
      • plates
      • bowls
  • Ring carriers are flexible and designed to surround beverage containers in order to carry them together.
  • Stir sticks designed to stir or mix beverages, or to prevent a beverage from spilling from the lid of its container.
  • Straws include:
    • straight drinking straws, and
    • flexible straws, which have a corrugated section that allows the straw to bend, packaged with beverage containers (juice boxes and pouches)

For accuracy, the above comes from the Government of Canada website directly, unedited.

What does this mean for Operators?

Again, operators in Canada don’t need to toss their current stock of the above items.

However, Restaurants Canada does recommend that operators contact suppliers and customers if they import, export, or sell prohibited items currently.

The single most important thing for operators to do now is research single-use plastic alternatives. Items need testing as changes will affect F&B items and the guest experience.

Of course, it’s possible an operator’s current supplier already offers alternatives to single-use plastics. That could prove convenient but costs, supply chain reliability, and impact on menu items need careful consideration.

Sustainability and responsible practices are no longer just conversation topics within the industry. As of this week, in Canada, they’re the only way forward.

Image: Volodymyr Hryshchenko on Unsplash

Burgers, French fries and milkshakes
by David Klemt David Klemt No Comments

Canada’s Top 2022 DoorDash Orders

Canada’s Top 2022 DoorDash Orders

by David Klemt

Burgers, French fries and milkshakes

Operators curious about the most popular delivery items in 2022 will be happy to learn that DoorDash’s year-end report is ready for viewing.

Those who want to compare it to predictions from several sources earlier this year can click here. The DoorDash Canada report can also be compared to consumer trends in Canada revealed back in October.

Before we jump in, I’m not detailing the DoorDash report in its entirety here. To review the entire report, please click here.

Instead, I’ll be sharing the top takeaways in terms of top menu items; top cuisines; and top items by province.

Speaking of provinces, a word to New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island, and the Yukon. Please don’t break out the pitchforks and come for me for not including you in this article. DoorDash’s report only covers data from six provinces—I didn’t leave you out intentionally.

Top DoorDash Cuisines in Canada

  1. American
  2. Mexican
  3. Japanese
  4. Thai
  5. Mediterranean
  6. Indian
  7. Chinese
  8. Italian
  9. Korean
  10. Filipino

Top DoorDash Items in Canada

  1. Burgers & Fries
  2. Fried Chicken
  3. Poutine
  4. Sushi Rolls
  5. Chicken Wings
  6. Burritos
  7. Chicken Rice Bowl
  8. Shawarma Wraps
  9. Curry
  10. Pad Thai

I think there’s one key takeaway that stands out in regards to this list. Notably, it appears that while chicken isn’t number one, it’s undeniably popular amongst Canadian DoorDash users.

In fact, according to DoorDash data, chicken reigns supreme in British Columbia. When you reach the province-specific sections below, you’ll see how powerful the cravings in BC are for chicken.

Top DoorDash Late-night Items

Again, chicken rules the DoorDash roost in this category.

  1. Chicken Nuggets
  2. Fries
  3. Poutine
  4. Chicken Wings
  5. Chicken Burgers
  6. Apple Pie
  7. Cheeseburger
  8. Spinach & Cheese Dip
  9. Chocolate Fudge Sundae
  10. Crispy Chicken

Top DoorDash Items: British Columbia

  1. Burrito Bowl
  2. Szechuan Chicken Lettuce Wraps
  3. Butter Chicken
  4. California Roll
  5. Crispy Chicken Sandwich
  6. Tofu Bowl
  7. Chocolate Chip Cookies

Top DoorDash Items: Ontario

  1. Cheeseburger
  2. Coffee
  3. Burrito Bowls
  4. Chicken Shawarma
  5. Crispy Chicken
  6. Bagels
  7. Pad Thai
  8. Beef Patty
  9. Pizza
  10. Onion Rings

Top DoorDash Items:Alberta

  1. Spinach and Cheese Dip
  2. Chicken Cheddar Sandwich
  3. Chilli Chicken
  4. Kale Salad
  5. Margarita Pizza
  6. Hot Apple Turnover

Top DoorDash Items: Québec

  1. Poutine
  2. Cappuccino
  3. Pad Thai
  4. Steak and Cheese
  5. Croissant
  6. Dumplings
  7. Chips
  8. Tacos

Top DoorDash Items: Saskatchewan

Interestingly, a beverage item holds the top spot in Saskatchewan.

  1. Bubble Tea
  2. Pepperoni Pizza
  3. Pork Bun
  4. Crispy Pork
  5. Garlic Bread
  6. Pasta

Top DoorDash Items: Manitoba

  1. Fries
  2. Butter Chicken
  3. Red Velvet Cake
  4. Poke Bowl
  5. Shawarma Wrap

As I stated in Wednesday’s article detailing Grubhub and Uber Eats’ reports for the US, we believe operators should take as much control over their restaurants and bars as possible. At KRG Hospitality, that means implementing direct delivery if it makes sense: ease of use, delivery capabilities, favorable costs, etc.

It’s also helpful to know what consumers in your area are craving and ordering. Such information can provide a useful baseline for many concepts’ menu development.

Image: John Fornander on Unsplash

Delivery worker on bicycle on city street
by David Klemt David Klemt No Comments

$28.82 per Hour for NYC Delivery Workers?

$28.82 per Hour for NYC Delivery Workers?

by David Klemt

Delivery worker on bicycle on city street

In response to the New York City Council’s proposal of $23.82 per hour for delivery workers, some “deliveristas” are asking for more.

Now, before we proceed, no, this isn’t a re-run of an article from last week. This isn’t a case of déjà vu—it’s the evolution of a news story that’s developing rapidly.

So, how much more do delivery workers in NYC want? Well, they’re after a significant bump over the council’s minimum hourly wage proposal.

Requesting that the NYC Council more accurately account for deliverista expenses, some delivery workers are asking for $28.82 per hour.

Early last week, a group consisting of Los Deliveristas Unidos and the Worker’s Justice Project members came together. They gathered at New York City Hall to make their stance on the NYC Council’s minimum wage proposal.

As the deliveristas see it, an increase from $23.82 to $28.82 more accurately reflects their operating expenses. The argument is compelling when one considers costs beyond fuel.

Asking for More

After all, not every delivery worker in NYC (and other markets) uses a car, truck or SUV to make deliveries. That should explain the use of the term “delivery worker,” not “delivery driver.” Some deliveristas ride motorcycles, mopeds, or bicycles. I’m willing to bet some even use scooters, rollerblades, or skateboards.

Using any mode of transportation as a delivery worker comes with requirements, both legal and practical. For example, deliveristas must maintain insurance, maintain their transportation, and purchase and maintain safety equipment.

And yes, that safety equipment is crucial. According to some reports, around a third of NYC those who deliver on two wheels have been injured on the job. Tragically, 33 delivery workers have been killed since 2020. In fact, NYC says delivery workers have the highest injury rate.

Another interesting development may seem semantic. However, when one takes time to truly consider the point it’s rather poignant.

In asking for the proposal of $23.82 to rise by $5 by 2025, are asking for a living wage. Not minimum wage, as the proposal frames the hike, but a living wage.

One worker, Antonio Solís, as quoted by The City, a non-profit NYC news publication, explained: “We are asking the city to make a $5 adjustment, to go that extra mile to ensure we get to a living wage.”

A Request, not a Rejection

It’s also important to note that NYC’s delivery workers aren’t rejecting the council’s minimum wage proposal. Rather, the request is that the council considers updating their proposal ahead of a December 16 public hearing on the matter.

So far, companies like DoorDash, Grubhub, and Uber Eats haven’t released much in the way of statements. However, there have been reports quoting a handful of representatives. In pushing back against the proposal, they’ve mentioned increased costs; reduced deliveries; and the possibility of “locking out” deliveristas if delivery demand is low at a given time.

Should legislation go into effect after the public hearing, it’s likely we’ll see lawsuits from the delivery companies.

Image: Patrick Connor Klopf on Unsplash

Red "New York" sign on building
by David Klemt David Klemt No Comments

$23.82 Minimum Wage for Delivery Workers?

$23.82 Minimum Wage for Delivery Workers in NYC?

by David Klemt

Red "New York" sign on building

With a public hearing on the docket for December 16, the New York City Council is proposing “fairer pay for delivery workers.”

The move is a year in the making. Last year, the NYC Council approved legislation with the goal of improving delivery worker pay and working conditions.

Now, the council is moving to increase minimum wage for the 60,000-plus delivery workers in the city.

At the risk of coming across as pessimistic, the legislation is likely to be unpopular with third-party delivery services. After all, when NYC and San Francisco passed laws to cap third-party delivery commissions, the big services filed lawsuits.

So, again, increasing the minimum wage for delivery workers in NYC will probably not go down well with companies like Uber, DoorDash, and Grubhub.

It’s possible we’ll find out before the end of this year. After the public hearing, the NYC Council will consider public comments. Then, the council could move forward and enact the legislation.

What’s in the Proposal?

Should the rule go into effect after the public hearing on December 16, minimum wage would rise to $17.87 per hour for third-party delivery workers. By April 1, 2025, that rate would increase to $23.82.

“This new proposed minimum pay rate would help ensure a fairer pay for delivery workers for third-party apps, providing more stability for 60,000 workers across our city,” says New York City Mayor Eric Adams.

According to reports, Brooklyn Borough President Antonio Reynoso is in favor of the legislation as well.

“It’s absolutely unacceptable that the restaurant delivery workers who provide for so many in this city are not justly compensated for their time, reimbursed for their expenses or provided essential benefits,” says Reynoso.

So, how did the council arrive at the $23.82 per hour figure? Well, we actually have that information:

  • $19.86, which matches standards set by the New York City Taxi and Limousine Commission for ride-hail drivers;
  • $2.26 for expenses delivery workers incur; and
  • $1.70 for worker’s compensation.

Why Legislate Delivery Worker Pay?

It appears the main reason is an incredibly simple one. In short, third-party delivery workers aren’t making minimum wage in NYC.

Per the Department of Consumer and Worker Protection (DCWP), delivery workers average less than the city’s $15 minimum wage. With tips, they’re averaging $14.18. And without tips? As one can imagine, the hourly rate plummets: $7.09 per hour.

According to the DCWP, the average hourly expense a delivery worker incurs is $3.06. So, that drives their hourly pay to $11.12 with tips, $4.03 without.

In an argument likely to be cited in any lawsuit filed by DoorDash (or at least shared in a public statement), the company claims its delivery workers make almost $29 per hour.

Clearly, there’s a discrepancy somewhere. Either delivery drivers are woefully underpaid for the service they provide or multiple researchers are misinterpreting hourly pay data.

Several sources have cited a statement made by a DoorDash representative about the NYC Council’s proposal:

“Dashing allows so many across New York City to earn when, where and how often they choose,” says the rep. “Unfortunately, the proposed rule does not appropriately account for this flexibility or that Dashers are able to choose which deliveries they accept or reject.”

Their statement continues, addressing a possible rise in costs and drop in orders:

“Failing to address this could significantly increase the costs of delivery, reducing orders for local businesses and harming the very delivery workers it intends to support.”

Why Should I Care if I Don’t Operate in New York City?

We’ll see—quickly, apparently—if this proposal becomes law. Should that happen, there’s reason to assume similar proposals will pop up in other cities and states.

We’ll also see whether or not third-party delivery companies file lawsuits in response. They’ve done so for commission caps, after all.

At any rate, this is one to watch. Similar legislation could be coming to your market.

Image: Nik Shuliahin 💛💙 on Unsplash

Chocolate cookie and cookie crumbles
by David Klemt David Klemt No Comments

How a Chain Lost My Business Forever

How the Staff at a National Chain Lost My Business Forever

by David Klemt

Chocolate cookie and cookie crumbles

An unfortunate and entirely avoidable guest experience debacle guarantees that I’ll never spend another dollar at a particular national American chain.

What was supposed to be a small treat and excuse to get outside for a bit went downhill quickly.

Now, before I begin, I tend to shrug at poor service. Truly, a front-of-house team member has to go pretty far for me to do more than raise an eyebrow.

Given how the past two years-plus have gone, my tolerance has only grown. Everyone has bad days, including restaurant, bar, and hotel staff. In fact, I tend to assume that someone is simply having an off day due to an array of reasons: working several days in a row, opening and closing multiple times a week; having more responsibilities heaped on them due to being short staffed; a seeming increase in abuse from guests; stress spilling over onto the job; etc.

However, that doesn’t mean I’ll always return to be subjected to poor service in the future. What I experienced yesterday falls into this category: I won’t spend my money with this chain ever again.

Third-party Issues

As stated above, my visit to this national chain (600-plus locations) was intended to be a small treat. It was Halloween, they specialize in a particular type of confection, so why not?

Also, the temperatures have been in the 70s and lower in Las Vegas—perfect for a trip on my motorcycle. So, two treats in one, really.

Okay, so I’m going to do something I don’t like doing here: making an assumption or two. I think, however, I’m basing them on sound reasoning.

Additionally, I don’t like to use third-party delivery. In this case, the order was placed via Uber Eats for pickup using a monthly credit. Zero offense to third-party delivery drivers—it’s the corporations behind the services and the fees they charge operators I don’t support.

So, my assumption is that because the order came in via Uber Eats the staff figured I was “just” a delivery driver.

Downhill Fast

I’ll concede that this visit didn’t start off on the wrong foot: I received a decent welcome. Since I was picking up the order, I stood at the pickup counter, and confirmation came in before I arrived that the order was ready.

There were three guests waiting when I walked in, and one by one they got their orders and left. I didn’t think anything was going wrong until people walked in after me and received their orders. In terms of this chain, my order was on the smaller side.

After several minutes of being ignored, I was asked if I was picking up for Uber Eats. I clarified that no, I’m not an Uber Eats driver, I was picking up my order placed via Uber Eats.

Another several minutes went by as I watched larger orders get fulfilled ahead of mine. And then I was asked again—by the same staff member—who I was picking up for. Again, not an Uber Eats driver—my order.

At this point, I had been waiting more than 10 minutes. When I was finally given my order, I noticed another difference. Staff members showed guests their orders to confirm the contents before handing them over. My order, however, was taped closed behind the counter and handed to me.

It didn’t strike me that this is how this staff treats Uber Eats driver until I was on my bike. And that’s the problem.

Standards of Service

If this is how staff treats third-party delivery drivers, it’s appalling. There’s no excuse for treating drivers differently just because they aren’t the guest themselves or fellow employees.

Let’s be clear: anyone walking through a restaurant, bar or hotel’s doors deserves at least decent service. There are several reasons for this, and I shouldn’t have to address them. But, hey, we’re already here, so why not address a couple?

First, standards. If your staff is purposely treating a group of people poorly because they think they can do so without ramifications, your standards have slipped or there simply aren’t any. That’s a problem.

Are team members going to get to know regulars? Absolutely. Are they going to have favorites. Of course! And there’s nothing wrong with that. In fact, that’s what should happen—every front-of-house team member should cultivate their own regulars.

So, yes, some guests will treated differently. There’s a huge difference, however, between subjecting some guests to poor service intentionally and delivering outstanding service to favorites.

Quite simply, the minimum standard of service should be great service. “Decent” sucks; great should be the baseline.

Regulars and guests who staff have rapport with should receive service that’s above and beyond the standard level. Rock star servers and bartenders deliver outstanding service to everyone, regular or first-timer, gracious guest or grump.

Different Treatment?

Second, your staff shouldn’t be treating third-party delivery workers like they don’t matter. There’s zero room in hospitality for treating people poorly—doing so is in direct opposition to the spirit of this profession.

In fact, they shouldn’t treat difficult guests with anything but your expected standards. Leadership team members should be confronting rude or difficult guests, protecting the rest of the team.

I’ve read and heard about restaurant staff treating third-party delivery drivers poorly. Always, of course, with justifications thrown in: retaliation toward rude drivers, drivers not tipping…pick a reason. Again, if there’s a rude driver, staff should alert leadership and they should handle it.

Look, I’ve made no secret of my view on third-party delivery apps. Their fees and taking advantage of operators, particularly during the pandemic, infuriate me. And it’s easy to point at me and say I’m part of the problem, using a credit to place a third-party delivery. I’ll accept that criticism.

What I won’t do is return to a business with staff who think it’s acceptable to allow standards to slip and treat delivery drivers poorly. Most people seem to take delivery jobs to make ends meet. Hell, some of them are likely service industry professionals themselves working another job or jobs.

The labor shortage isn’t a valid justification for slipping standards or poor service. Dislike of third-party delivery services is no justification, either.

In fact, this chain obviously sees these delivery services as a viable income stream. The fact their staff doesn’t is a problem. If there’s a standard of service for this chain, it certainly wasn’t met when I was there. And if there’s a standard that I didn’t receive, there are several other problems.

Either way, the damage is done.

Image: Andre Moura via Pexels

Burger in container inside car
by David Klemt David Klemt No Comments

The Numbers on Food Delivery in Canada

The Numbers on Food Delivery in Canada

by David Klemt

Burger in container inside car

For most restaurants, delivery is now a crucial service element rather than a “nice-to-have” option a small percentage of guests expect.

This is true whether your restaurant is in the US or Canada. But who’s placing orders? How are they ordering? And will they continue to order for the foreseeable future?

Well, Restaurants Canada has answers to all those questions and more. So, we let’s take a look at what their 2022 Foodservice Facts report says about delivery.

To download your own copy of this informative report, click here.

Who’s Placing Orders?

In their 2022 Foodservice Facts report, Restaurants Canada looks at three age groups:

  • 18 to 34
  • 35 to 54
  • 55-plus

Perhaps unsurprisingly, the 18- to 34-year-old cohort leads the charge when it comes to ordering delivery. It’s also not surprising that 35 to 54 comes in second, and 55 and older is third.

However, the first two groups are closer than some may assume. Eighty-three percent of the the 18 to 34 cohort placed orders at quick-service or full-service restaurants between December 2021 and May 2022.

That number does drop for the same time period among the 35 to 54 group, but not by a significant amount. Of that cohort, 77 percent ordered delivery. Just over half of the 55-plus group placed delivery orders: 52 percent.

Now, those numbers are down a bit from 2021, which makes sense. Things were much more restrictive in 2021 and people were just getting back to a sense of normalcy at the start of this year.

In 2021, the delivery order percentages were:

  • 18 to 34: 89 percent
  • 35 to 54: 81 percent
  • 55-plus: 67 percent

Looking at these numbers, it appears the 55-plus cohort is more comfortable dining out in person. Conversely, the 18 to 34 age group is clearly comfortable making delivery a part of their everyday lives.

How do People Want to Order?

Believe it or not, your website still matters. I’ve been saying this for years but the pervasiveness of delivery and takeout ordering is really driving this point home.

The fact is, a notable percentage of your guests want to support your restaurant and staff directly. Over the past couple of years, consumers have become well aware that third-party delivery services are incredibly costly for operators.

Consumers are also aware of third-party delivery debacles, such as the abysmal Grubhub “Free Lunch” mess from May of this year.

So, direct delivery is something that operators need to at least consider. Implementation is often less difficult than most business owners believe. And many platforms, SevenRooms, for example, make implementing direct delivery simple and affordable.

Interestingly, Restaurants Canada data supports the need for direct delivery. Back in May, the industry advocacy organization asked survey respondents how they prefer to place delivery orders from restaurants.

Preferences for QSR customers:

  • No preference: 10 percent
  • Over the phone: 19 percent
  • Third party: 35 percent
  • Restaurant website or app: 36 percent

Full-service customer preferences:

  • No preference: 8 percent
  • Over the phone: 28 percent
  • Third party: 29 percent
  • Restaurant website or app: 35 percent

Honestly, I find it surprising anyone calls a QSR to place an order. However, I suppose that makes sense for an office or catering.

At any rate, make sure your website is up-to-date, you offer direct or “last-mile” delivery, and make it easy to navigate your menu and the ordering process.

Is Ordering Here to Stay?

Now, we all know why restaurant delivery has been supercharged the past two years. However, consumer trend data show that delivery was on the rise before the Covid-19 pandemic.

But now that people are eager to return to normal and the industry is on its way to returning to pre-pandemic levels, is delivery really here to stay?

According to another question asked of survey respondents by Restaurants Canada, more than half of QSR and full-service restaurant customers plan to stick with delivery.

For their 2022 Foodservice Facts report, Restaurants Canada asked back in May how often consumers planned to place delivery orders in the next six months.

Order frequency for QSR customers:

  • Never placed a delivery order and don’t plan to now: 29 percent
  • Order less often: 20 percent
  • Will order with the same frequency: 45 percent
  • Will order more often: 7 percent

Frequency of orders for full-service customers:

  • Never placed a delivery order: 24 percent
  • Order less often: 23 percent
  • Will order with the same frequency: 44 percent
  • Will order more often: 9 percent

Here to Stay?

Of course, there are multiple factors feeding the numbers above. Some people simply don’t like ordering and waiting for delivery. For these consumers, the practice doesn’t just seem convenient.

There’s also the consumer demand to return to in-person dining, socializing with family and friends. And, of course, meeting new people while dining out.

We must also consider inflation and rising costs. Often, restaurant spending is among the first to be reduced when consumers need to be more frugal. Rising menu costs are sure to curtail some delivery spending.

That said, it’s clear delivery is here to stay and must be considered a crucial element for most restaurant operations. QSR and full-service operators need to bear in mind is placing orders; how often they’re placing orders; and get them in the habit of placing orders directly.

Image: Oliur on Unsplash

White clock on red background
by David Klemt David Klemt No Comments

Restaurants in Canada: Daypart Performance

Restaurants in Canada: Daypart Performance

by David Klemt

White clock on red background

For both in-person dining and off-premise consumption, more Canadian consumers are ordering from restaurants across all dayparts.

As Restaurants Canada points out in their latest report, traffic and sales remain lower than pre-pandemic levels. However, there are reasons to be positive.

For one example, Restaurants Canada predicts 2022 sales to return to pre-pandemic levels by the end of the year. The foodservice research and advocacy organization’s 2022 Foodservice Facts report provides another positive outlook.

Just looking at Q1 of this year versus Q3, all dayparts are seeing increases in traffic.

To read more about the report and grab your own copy, follow this link.

Numbers Tell the Tale

Per Restaurants Canada, the breakfast daypart slid significantly in 2020. During that time, it fell 20 percent that year.

For the first half of this year, however, Restaurants Canada reports that breakfast traffic is just four percent lower in comparison to 2019.

On a positive note, the breakfast daypart has risen steadily from March of this year to July, or Q1 versus Q3. In fact, all dayparts have grown.

According to Restaurants Canada, 43 percent of Canadians ordered breakfast from restaurants in March 2022. That number grew to 50 percent by July of this year.

In terms of snack purchases, 55 percent of Canadian consumers made purchases from restaurants. By July, that percentage rose to 62 percent.

Continuing along, 64 percent of Canadians placed lunch orders in March. Four months later, that number had increased to 73 percent.

Per the 2022 Foodservice Facts report, a significant percentage of Canadians are placing lunch and snack orders. In fact, Restaurants Canada says that Canadians are making purchases from restaurants during those dayparts two to three times per month.

Of course, there’s one more daypart we need to discuss…

Dinner is King

By the numbers, the dinner daypart is outperforming all others in Canada.

In March of 2022, 85 percent of Canadians had placed dinner orders at restaurants. That number rose to 87 percent in April but dipped to 86 percent in May.

However, dinner saw growth again in June and July, rising to 88 and then 89 percent, respectively.

As the numbers show, dinner orders are outpacing lunch orders 14 percent. Snacks are being outpaced by dinner by nearly 30 percent. Of all dayparts, breakfast is the weakest.

In fact, dinner outperforms breakfast by nearly 40 points. This makes sense when we consider the work-from-home effect.

More people working from home means, in theory, many less people commuting to work. Restaurants that once saw great breakfast daypart traffic are seeing a significant dropoff. Less people commuting means less people popping into a restaurant for breakfast.

It appears that instead, people are clocking in, working until break time, and then going to get a snack. And when lunch rolls around, why not place an order for lunch?

Naturally, after working all day, people are tired or eager to meet up with friends and family to socialize and decompress. So, dinner ruling the daypart roost makes complete sense.

In other words, operators looking to streamline should consider this Restaurants Canada data. The dayparts that require the most labor currently are lunch and dinner, so operators should plan accordingly if that’s viable for their business.

Image: CHUTTERSNAP on Unsplash

Closeup shot of double cheeseburger
by David Klemt David Klemt No Comments

Will Virtual Kitchens Persist?

Will Virtual Kitchens Persist or Go Brick-and-Mortar?

by David Klemt

Closeup shot of double cheeseburger

Virtual kitchens and virtual brands are back in the headlines after a record-setting grand opening in Rutherford, New Jersey.

Well, I should clarify: A restaurant may now hold a specific record.

The restaurant in question is the first brick-and-mortar MrBeast Burger location. And the record it may hold claim to is most burgers sold in a single day by a single restaurant.

 

View this post on Instagram

 

A post shared by MrBeast Burger (@mrbeastburger)

Now, if you don’t spend much time on YouTube, you may not know MrBeast. So, here’s a quick rundown: He’s Jimmy Donaldson, a YouTube personality known for “expensive stunts.” In fact, he may be the pioneer of that type of content.

Right about now you may be wondering what this all has to do with virtual kitchens and brands. It’s quite simple, really. MrBeast was among the highest-profile virtual brands to launch during the pandemic.

Incredibly, MrBeast Burger boasts more than 1,700 virtual kitchen locations. And now, one brick-and-mortar MrBeast restaurant.

Leveraging Demand and Popularity

So, you’re an influential YouTube content creator with tens of millions of subscribers. Obviously, your channel is monetized. What else can you do to leverage your popularity?

Well, if there’s a pandemic crippling the globe and people are stuck at home, maybe you notice the demand for takeout and delivery. And perhaps you learn about something known as a “virtual kitchen.”

If you’re a foodie or maybe just a savvy businessperson, maybe you’d jump into the virtual space. It is, it goes without saying, much less expensive than opening your own restaurant. And if you perform well, that’s an excellent way to collect data and guest feedback.

Also, an efficient way to hone your brand without a lease, buildout or the overhead of a physical restaurant. In a way, a virtual brand is akin to a pop-up restaurant, only you can test hundreds of markets simultaneously.

Okay, so now let’s say you reach a rare milestone in the creator space: 100 million subscribers. MrBeast did just that in July of this year. Do you think you’d want to leverage the support of millions of fans willing to support you and your brand?

The first physical MrBeast Burger opened last week at the American Dream mall in New Jersey. Reports claim that over 10,000 people waited in line for the grand opening.

Oh, and that’s when the location may have claimed the aforementioned record: 5,500 burgers sold in one day. After just one day of operation, MrBeast wondered if the brand should franchise:

Virtual to Physical

This (potential) record-setting event brings virtual kitchens and brands back into the spotlight.

Of course, most virtual brands don’t have the same origin story as MrBeast. One hundred million supporters? That’s rarified air.

At any rate, virtual kitchens do offer potential physical restaurant operators a less expensive method of testing their concepts. Couple data collection and feedback with an accurate feasibility study and taking the next step may make sense. And it may make a tidy profit.

It’s possible we’ll see MrBeast franchise off the success of two years of operating virtually and opening a physical location. And it’s possible we’ll see other virtual brands expand beyond the virtual kitchen.

However, it’s important that virtual brand owners keep a few things in mind. One, online success doesn’t always translate to brick-and-mortar success. Two, the restaurant space doesn’t care about your subscriber count—the KPIs are entirely different here. Three, potential operators need to perform the proper studies—or retain an agency with experience performing them—rather than rushing into the restaurant space.

It’s highly likely we’ll see more virtual brands enter the physical restaurant world. How many will do so successfully remains to be seen.

Image: Eiliv-Sonas Aceron on Unsplash

NCR Aloha NRA Show booth
by David Klemt David Klemt No Comments

Tech Shows Up in a Big Way at NRA Show

Tech Shows Up in a Big Way at 2022 National Restaurant Association Show

by David Klemt

NCR Aloha NRA Show booth

The number of tech platforms and solutions at the 2022 National Restaurant Association Show in Chicago was a sight to behold.

Once seemingly technology averse, our industry is awash in platform integrations, apps, and smart devices.

Drive-thru signs are reading license plates and collecting data. Digital menu signs are implementing facial recognition software. Automation is taking on more and more tasks.

Amazingly, the digital paint on the innovations we’re seeing isn’t even dry yet. While some developments may have taken years to come to market, it feels like they’re only one or two years “old.”

Here to Stay

People are still talking about a “return to normal” when it comes to the Covid-19 pandemic. To some, that means going back to their 2019 habits and lifestyles.

Well, that’s not going to happen in the restaurant, bar, or lodging spaces.

Delivery? Here to stay. Contactless payment? Not going anywhere. QR and digital menus? Commonplace at this point.

And contactless pickup? NRA Show 2022 attendees exploring the North Building encountered multiple pickup platforms.

To state the obvious, delivery is expensive. Combine inflation and rising gas prices with third-party delivery platform fuel surcharges and it’s only getting pricier.

Clearly, contactless pickup is becoming a more appealing solution for operators and their customers.

On the one hand, operators who invest in smart, contactless pickup lockers can avoid the exorbitant costs they incur from third-delivery companies. And on the other hand, customers know they can save money by picking up their orders themselves. Moreover, they know they can do so safely with contactless pickup.

Operators can now choose from an array of smart locker setups to leverage customer demand for safe, convenient takeout.

Your New Marketing Partner

Remember when people were blown away by QR code menus? Well, those are already old news.

As an aside, the fine-dining and luxury categories have been over QR codes for quite some time. However, they’re probably not going to be interested in the latest menu innovation. No, they’re much more eager to return to traditional, tactile, luxurious physical menus.

Other categories, though, will likely be interested in smart digital menus. As this tech gets smarter—perhaps terrifyingly so—your menu will be a supercharged sales associate.

There are digital menus coming to market that can recognize an operators guests…and then attempt to upsell them. The more a guest visits a venue with smart signs, the more the platform learns about them and their preferences. From there, the signs can attempt to sell them on a promotion like an LTO item.

Not long ago at all we learned that texting a consumer is a powerful way to market to them. Well, now we’re going to have the opportunity to sell them in a direct, interactive way straight from our menus.

Oh, and if this isn’t impressive enough, there are digital sign platforms capable of displaying surge prices. In the blink of an eye an operator will be able to leverage this type of pricing and revenue generation.

More Powerful POS

There were no shortage of powerful POS systems at the 2022 NRA Show. If anything, there are almost too many options out there for operators to consider.

However, we don’t think this is a bad problem to have. In fact, tech stack selection is one of KRG Hospitality’s key services.

Now, I’m not saying operators need to chase the newest, shiniest POS on the market. If what an operator has is working smoothly and they’re getting the most of their POS every day, there’s no reason to invest in a completely new platform.

But along with POS developments come powerful integrations. Case in point, Lunchbox. In simple terms, Lunchbox is an online ordering, marketing, loyalty, and guest subscription platform.

Lunchbox 2022 NRA Show booth display

Recently revamped, this fun brand (one of the coolest booths at the show, if not the coolest) boasts an average increase in same-store sales of 52 percent. Additionally, Lunchbox customers (per the company) experience an average of 42 percent month-over-month revenue growth.

As impressive is the fact that this platform integrates with several top POS systems, including Toast, Oracle’s Micros, NCR’s Aloha, and Revel.

What a time, eh?

Photos taken by and property of author

"Stop Making Stupid People Famous" graffiti
by David Klemt David Klemt No Comments

Alright, Seriously—WTF, Grubhub?

Alright, Seriously—WTF, Grubhub?

by David Klemt

Or, more to the point, stop working with “partners” who exploit our industry rather than support it.

In spectacular and entirely predictable fashion, Grubhub’s “free lunch” further reveals that third-party delivery platforms don’t care about restaurants.

Of course, they all say they support restaurant owners and operators. And, of course, they’re quick to pat themselves on their backs for being a pandemic lifeline.

But…no. Time and time again, mainly through their exorbitant and exploitative fees, they prove the opposite is true.

Restaurants and bars aren’t third-party delivery partners. Rather, these relationships are adversarial and detrimental. So much so, in fact, that some states passed laws to limit third-party delivery fees.

In Nevada, for example, Clark County Commissioners passed an emergency ordinance in August 2020 capping those fees at 15 percent. Clearly, we need to stop enriching companies that prove they don’t support the hospitality industry but cause it significant harm.

Free Lunch?

They say there’s no such thing as a free lunch. Apparently, Grubhub really wants to prove that maxim true.

That’s one of the takeaways from their disastrous promotion. Last Tuesday, in what’s being reported as an attempt to claim the delivery throne in New York City, Grubhub offered “free” lunch to anyone who placed an order for delivery.

The requirements for this promotion? Place an order for delivery through Grubhub on May 17 between 11:00 AM and 2:00 PM and use the code “freelunch.”

Of course, customer orders weren’t entirely free. Rather, the code was good for a $15 discount. Still, a wildly attractive offer as the ensuing debacle reveals.

Unsurprisingly, the promotion made for some eye-grabbing and eye-rolling headlines. Buzzfeed News published the most attention-grabbing one: “GrubHub Was Getting 6000 Orders A Minute During Its Promo Today That Left Restaurant Workers Stressed And Customers Hangry.”

Six thousand orders per minute during a promotion with a three-hour window in a single market.

In addition, the outlet reported that one unsatisfied customer was number 3,630 in the Grubhub customer service queue. Apparently—and who can blame him—he hung up before he could speak with a Grubhub rep about his missing order.

Duh

Who could’ve seen this coming? Any of the restaurant owners, operators, or team members Grubhub “serves,” that’s who.

In fact, anyone who works in this industry with on-premise experience knew this was going to happen. So, too, any journalist who specializes in hospitality.

The fact that whoever came up with this promotion didn’t see this coming is revealing. Unless the creators of these apps and services have real-world restaurant experience, they don’t understand the business.

How can one effectively and properly serve an industry without an understanding of how it operates? Hospitality is about service. Shouldn’t the companies attempting to work within our industry work hard to serve alongside us?

Let’s be clear—this promotion was in no way designed to help struggling restaurants. It wasn’t intended to boost their traffic and revenue. Rather, it was solely created to serve Grubhub’s desire to be number one.

As we all know, we’re experiencing major staff shortages. There are also supply shortages making it difficult for operators to obtain product reliably. Grubhub made those problems exponentially worse.

Some restaurants stopped taking delivery orders. Others canceled orders. There were operators who closed in an effort to catch up with orders and prevent the situation from worsening.

According to news stories, some social media users posted that they planned to stop ordering through third-party platforms.

Negative Impact

If you’re new to KRG Hospitality, welcome. You’re likely realizing that we’re not fans of third-party delivery.

Those of you who are familiar with us have known for quite some time that we support direct delivery. That is, delivery controlled and executed by the restaurant itself.

It’s not that we’re against innovation. Rather, our dislike of these platforms, generally speaking, comes from our perception of their behavior.

In our opinion, they take control away from operators and cost them money. Again, speaking generally, they collect customer data that operators should control. Their fees are ridiculous in most cases. And when it comes to the customer experience, their inconsistencies and shortcomings reflect poorly on the operators far too often.

Studies show that customers who have issues with third-party deliveries often place the blame on the restaurant. Food the wrong temperature? Order arrive late? Packages in less-than-ideal condition? While those issues and others can be the fault of the driver, the restaurant often takes the brunt of a customer’s dissatisfaction.

Of course, there’s also the financial impact of third-party delivery on restaurants. A SevenRooms report from last year reveals how these platforms harm operators and their bottom lines.

The Solution

Look, we know operators have a ton on their plates. But protecting and boosting the bottom line is a non-negotiable element of this business.

Yes, it’ll take some time, effort, and money to set up direct delivery. However, it’s the best solution.

Direct delivery means the operator collects and control valuable data. Likewise, the operator can ensure consistency. Through direct delivery, the operator shapes and controls the experience.

Control. Inherently, third-party delivery takes some control away from operators. That’s not a good thing, and neither is their financial impact.

Look into setting up direct delivery, take control, and protect your revenue ASAP. Friend of KRG “Rev” Ciancio and SevenRooms CEO Joel Montaniel each address delivery on the Bar Hacks podcast. Listen to episode 13 with Rev and episode 24 with Joel to learn more about delivery.

We need to stop rewarding companies that exploit our industry and take advantage of our owners, operators, and hard-working staff members.

Direct delivery is the answer. Take steps to implement it today.

Image: Rosie Kerr on Unsplash

Delivery or takeout food order in brown paper bag
by David Klemt David Klemt No Comments

What Consumers Expect from Delivery

What Consumers Expect from Delivery

by David Klemt

Delivery or takeout food order in brown paper bag

Consumers are developing specific behaviors and opinions regarding delivery that impact their perception of restaurants and brands.

Over the course of two years and three surveys, Deloitte has attempted to learn more about consumers and delivery.

In total, Deloitte surveyed 1,550 restaurant customers. Additionally, the multinational interviewed highly positioned executives from ten casual, fast-casual, and QSR brands.

What Consumers Want

First, it should come as no surprise that delivery is here to stay. None of Deloitte’s survey results indicate otherwise.

In fact, it appears that some consumers are showing an interest in additional delivery methods. Half of survey respondents are willing to try driverless or drone delivery.

More than half—64 percent—don’t expect to return to pre-pandemic dining habits by March of this year. Illustrating the habit of ordering takeout and delivery, 61 percent of respondents engage with restaurants that way at least once per week. That represents a 32-percent increase from June 2020 to September 2021.

When dining off-premise, 57 percent of Deloitte survey respondents prefer to place orders via an app. However, 40 percent of respondents prefer a restaurant’s own branded website or app. That shows that:

  1. A restaurant’s website matters. A significant percentage of consumers want to get information, get a feel for a restaurant, and place orders with a business directly.
  2. Direct delivery is feasible. Consumers want to know and feel as though they’re supporting a restaurant directly rather than a third-party business.

Own the Delivery Experience

Of course, quality is a concern with consumers who place delivery orders. This points to another pitfall regarding third-party delivery beyond the fees.

Unfair as it is, three out of five restaurant customer survey respondents have quality expectations. Specifically, they expect the same food experience off-premise as they receive on-premise. That means the same quality and the same freshness.

They also indicate that wait times of up to 30 minutes are acceptable. Here’s where the risk to restaurants comes into play. Consumers will fault the restaurant for late orders; cold food (or melted or room-temperature food for cold items); iced drinks becoming watered down; and other order issues even if they’re delivered by third-party services.

So, operators must look into and invest into what they can to improve the quality of delivery orders. Containers that keep hot food hot, French fries and other fried foods crisp, and cold foods cold are paramount.

Unfortunately, problems that occur after an order has left a restaurant—which are out of the business’ hands—are often attributed to the venue. Another reason, then, to consider and implement direct delivery.

Image: Yu Hosoi on Unsplash

Page in Olympus typewriter with "2021" typed onto it
by David Klemt David Klemt No Comments

Top 2021 KRG Hospitality Articles

Top 2021 KRG Hospitality Articles

by David Klemt

Page in Olympia typewriter with "2021" typed onto it

We’ve gathered the top KRG Hospitality articles from 2021 and separated them into five distinct categories: Food, Beverage, Operations, Marketing & Promotions, and Industry News

Food

Delivery and Takeout Food Trends for 2021: Canada

It should come as no surprise that interest in what food items Canadian consumers wanted to order for delivery and takeout skyrocketed last year. (link)

Delivery and Takeout Food Trends for 2021: United States

Obviously, owners, operators and management wanted to stay current on consumer food trends in the USA as well. (link)

Have a Slice of Nostalgia: The Return of Viennetta

Never underestimate the marketing, promotions, and profitability power of nostalgia. This is particularly true when people are seeking comfort. (link)

Beverage

Uncorked: 2021 Wine Trends to Watch

Understanding what wines are trending is an effective way to boost profits and overcome wine intimidation. (link)

Fever-Tree Cola: Set Aside Your Soda Gun

Outright eliminating soda guns may be a long shot. However, cocktails crafted using bottled craft ingredients can justify premium prices. (link)

These are the Drinking Trends to Watch in 2021

We may not have a crystal ball but we have the next best thing: Data. (link)

Operations

Container Kitchens: The New Footprint

Several industry experts and intelligence agencies predict smaller restaurant footprints moving forward. Container kitchens are certainly a viable method to shrink venue sizes. (link)

The Reality of Hiring Right Now

It really doesn’t need to be said but I’ll do it anyway: The labor shortage and “Great Resignation” are real. (link)

The 5 Ds of Bystander Intervention

Sure, great food and beverage are crucial to luring people in, wowing them, and converting them to repeat guests. However, so is the experience. A key element of a positive memorable experience is ensuring guests feel safe. (link)

SevenRooms Reveals Third Party Delivery Impact

The high-tech reservation platform shows what many suspected to be true: Direct delivery is better for operators than third-party delivery. (link)

Marketing & Promotions

How SevenRooms Improves Operations

Not only does SevenRooms make handling reservations easier, it also makes setting up marketing campaigns simple and effective. (link)

This Generation is Most Likely to Dine In

If you want to know who to market in-person dining to, here’s your answer. (link)

0.0 to 0.5 Beers to Know for Dry January and Beyond

Dry January (along with Damp January) is here to stay. This is a sampling of alcohol-free and low-ABV craft beers to offer Dry and Damp January guests. (link)

Industry News

I Tried the Mask Made for & by Hospitality

None of us enjoy wearing face masks. This mask is comfortable to wear and amplifies the wearer’s voice. (link)

What’s the RRF Replenishment Act?

Well, here’s one take on an answer to this question: It’s the bill to replenish the RRF that has made zero progress since June of 2021. (link)

Build Back Better…Without Restaurants or Bars?

The BBB Act was passed in November. Of course, it didn’t include the Replenish RRF or ENTREE acts. It’s much easier for politicians and lawmakers to say they care about and support our industry than actually prove it. (link)

Image: Markus Winkler on Unsplash

Cheeseburgers and French fries in takeout containers on pass
by David Klemt David Klemt No Comments

SevenRooms Announces Olo Partnership

SevenRooms Announces Olo Partnership

by David Klemt

Cheeseburgers and French fries in takeout containers on pass

SevenRooms continues to grow and develop innovative partnerships.

The platform’s newest partnership benefits the hospitality industry, operators, and consumers.

In joining forces with Olo, SevenRooms further helps restaurants, bars, and hotels position themselves to succeed in an increasingly digital world.

The Bleeding Edge

Olo, which literally stands for “Online Ordering,” predates the iPhone.

In fact, the company launched before smartphones were more than niche devices.

Upon its inception, Olo’s service consisted mainly of sending mobile coffee orders to restaurant printers via text message.

Like SevenRooms, Olo seeks to stay ahead of the consumer behavior curve:

  • 2005: Olo launches, anticipating coffee drinkers will eagerly embrace mobile ordering.
  • 2008: The company predicts fast-casual restaurants will become faster than fast food.
  • 2012: Olo envisions the redesigning of kitchen restaurants to include pickup windows.
  • 2015: The platform sees the future for foodservice is delivery.

Now, Olo is dedicated to making sure online ordering customers benefit from the industry’s digital transformation.

The Partnership

SevenRooms ensures clients who also use Olo can capture their off-premise customers’ information. That data then creates profiles for those customers automatically.

This partnership leverages SevenRooms CRM and marketing automation integration. Operators will be able to send post-order surveys to off-premise, online ordering customers automatically.

So, operators can learn what is and isn’t working off-premise; elevate the experience of off-premise customers to increase online order frequency; convert those customers to in-person guests; encourage repeat visits; and increase profitability.

Moving forward, SevenRooms and Olo users will get to know their off-premise customers better.

“To meet the ever-evolving needs of our hospitality clients, we’ve continued to seek out strategic partners who help us provide an even more comprehensive solution to operators,” says SevenRooms CEO and founder Joel Montaniel. “Our integration with Olo delivers on our promise of offering a 360-degree platform focused on helping operators build deeper, direct relationships across on- and off-premise experiences. This partnership facilitates better operational efficiency and online data capture, ultimately helping operators optimize the profitability of their delivery and takeout business while strengthening customer relationships. We are excited to welcome Olo to our partner network, and look forward to our continued collaboration to drive better, more streamlined solutions for the industry.”

Learn more about SevenRooms here. Click here to learn more about Olo.

Image: call me hangry 🇫🇷 on Unsplash

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