Fast casual

2024 KRG Hospitality Start-up Costs Guide

December 21, 2023by David Klemt David Klemt No Comments

KRG Releases 2024 Start-Up Guide

KRG Hospitality Releases 2024 Restaurant Start-Up Cost Guide

by David Klemt

KRG HOSPITALITY RELEASES SIXTH ANNUAL RESTAURANT START-UP COST GUIDE

Toronto-based hospitality industry consulting firm with offices in key markets throughout Canada and the United States of America unveils their latest restaurant cost guide and interactive hospitality calculator.

December 21, 2024 (TORONTO)—Today, KRG Hospitality releases their 2024 Bar & Restaurant Start-up Costs Guide, which is free to download. The Toronto-based consulting firm specializes in startup restaurant and bar projects along with boutique hotels, experiential concepts, and entertainment venues. KRG Hospitality’s American headquarters is located in Las Vegas, Nevada.

For the past six years KRG has researched, reviewed, and published the annual start-up cost guide, one of the industry’s leading resources dedicated to restaurant project costing.

And each year this informative and transparent guide is used as a trusted budgeting tool by developers, lenders, contractors, consultants, and aspiring restaurateurs. The guide is founded upon KRG Hospitality’s proprietary database of previous project costs, which includes project data from restaurants, bars, and cafes developed over the past 24 months.

Further, this annual KRG Hospitality guide also includes the interactive KRG Hospitality Calculator, which is updated for 2024.

The costs to start a restaurant have been on a steady rise over the past six years. Major drivers are increases in inflation, interest, labor, construction, and equipment. Of course, there are also the unique materials required to deliver a scalable, sustainable, memorable, profitable, and consistent on-premise, off-premise, or hybrid-style concept.

Drawing upon this comprehensive guide, an industry-leading expert has analyzed the information and provided a succinct and user-friendly summary of the findings for each major start-up category. This isn’t simply a couple of pages identifying a few costs. Rather, the sixth annual guide is a deep dive that provides real insight into what to expect in 2024.

The guide is available now as a free download via this link.

About KRG Hospitality

KRG Hospitality is a storied and respected agency with proven success over the past decade, delivering exceptional and award-winning concepts throughout a variety of markets found within Canada, the United States, and abroad since 2009. Specializing in startups, KRG is known for originality and innovation, rejecting cookie-cutter approaches to client projects. The agency provides clients with a clear framework tailored to their specific projects, helping to realize their vision for a scalable, sustainable, profitable, memorable, and consistent business. Learn more at KRGHospitality.com. Connect with KRG Hospitality and the Bar Hacks podcast on social: KRG Twitter, Bar Hacks Twitter, KRG Media Twitter, KRG LinkedIn.

Disclaimer

While using this guide helps develop a rough preliminary financial and strategic milestone plan, it is strongly recommended that you seek professional expert advice to provide you with a more precise, project specific estimate as each concept and market will be slightly different. KRG Hospitality Inc. is not responsible for any project that is not currently under contract within the company.

Image: KRG Hospitality

December 19, 2023by David Klemt David Klemt No Comments

Grubhub Reveals 2023 Order Trends

Grubhub Reveals 2023 Order Trends

by David Klemt

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

Gloved chef's hand pressing down on cheeseburger bun

December 15, 2023by David Klemt David Klemt No Comments

Transactional vs. Experiential Service

Is Your Business Transactional or Experiential?

by David Klemt

When you consider your restaurant or bar honestly, is the service you and your team are providing to guests transactional or experiential?

It’s an important distinction, and it applies to every restaurant and bar category. Whether operating a QSR or FSR, today’s guests want more for more their money.

Further, they expect more just for choosing to leave their homes. A recent report from CWB Franchise Finance, in partnership with Circana and fsStrategy, indicates strongly that experiential concepts are on the path to weathering economic challenges and achieving long-term success.

Now, to be clear, of course all businesses are transactional. In that regard, restaurants and bars are clearly no different from other businesses.

Guests come in, they place orders, and they pay for the goods they receive. Transactional, right?

However, restaurants and bars are in a position to deliver memorable experiences.

Sure, for some people those memories are fleeting. There are those who are always seeking the next thing. But operators who become known for providing more than just menu items will remain on the radar of even the most fickle guest.

When a restaurant or bar delivers goods plus phenomenal services, when the guest experience involves more than just ordering and paying, it becomes experiential.

Think back to the times this year you’ve popped into a QSR or fast-casual restaurant. Can you remember much about the experience? If yes, fantastic—that operator understands the power of an experiential business model. Should the answer be no, that operator sees value only in being transactional.

Which are you happy to return to in the future?

Experience is King

I’m going to assume you’re much happier to return to an experiential concept than a strictly transactional one. And if that’s a correct assumption, you should apply that to your own restaurant or bar.

According to studies Circana has conducted over the past couple of years, Canadian consumers are reacting to economic uncertainty and financial instability as one would expect: cutting back on discretionary spending.

Generally speaking, that means reducing their spending at restaurants and bars. However, there’s a bit of good news tucked into those Circana studies.

Per Circana, half of Canadians plan to increase spending on something in particular: experiences. Further, 91 percent of Canadians say they’ve spent money at experiential restaurants recently.

“A restaurant visit isn’t necessarily just about nourishment, but instead is a platform for socializing, entertainment and exploration,” reads the joint CWB, Circana, and fsStrategy report.

Importantly, an operator need not go to extremes to deliver an experience. Something as simple as creating an LTO around craveable drinks can pay huge dividends. For proof of that, simply look at McDonald’s in the US and the hype that surrounded the berry-flavored Grimace Shake.

Operators throughout Canada and around the globe need to understand how impactful being experiential can be.

Takeaway

It’s true that operators are competing against one another. However, it goes deeper than that now.

Operators are also battling convenience and comfort. Between working from home, pandemic-induced isolation, and technology, people are used to staying in and ordering whatever they want.

So, not only are operators faced with the challenge of standing out from one another, they’re up against the phones in people’s pockets.

For many people, choosing to leave home to dine and drink in person is a big deal. To some, restaurants and bars are about celebrating special occasions or socializing. For others, the motivation is as simple as the need to finally get out of their home.

It’s imperative, therefore, for operators to be more than transactional. Being experiential, whether the experience is small but impactful or over the top and unforgettable, is the way forward.

Restaurants and bars that deliver a memorable experience are better positioned to remain top of mind for a guest’s future in-person visits, delivery and takeout orders, and large-party special events. Don’t think of being experiential just in terms of nailing each visit, think of elevating the guest experience to capture future business.

A focus on the experiential builds loyalty from existing guests, and it encourages those guests to become ambassadors of your brand. Ask what you can do with your menu, team, and space today to become more experiential than transactional.

Image: Thiago Miranda on Pexels

Kentucky Peerless Distilling Co. whiskey barrels

December 13, 2023by David Klemt David Klemt No Comments

Will Whiskey Bring Us Together?

Will Whiskey Bring Us Together?

by David Klemt

A letter penned by Senator Catherine Cortez Masto and signed by a bipartisan group of senators shows that we’re capable of coming together.

There’s seemingly no escape from messages that America is divided like never before. And, when inundated with that message, it’s easy to believe. Sadder, when we believe that message it’s too easy to plunge into despair.

However, 17 senators, Democrats and Republicans, are coming together in support of American whiskey.

These senators are seeking the permanent removal of tariffs on American spirits and wine by the European Union. That 25 percent tariff, first imposed in June of 2018, is in retaliation over a dispute over aluminum and steel. This was a response to the US imposing a 25 percent tariff on steel imports, and ten percent on aluminum.

Unfortunately, after a suspension in 2021, the tariffs on American whiskey will jump to 50 percent on January 1, 2024. So, Sen. Cortez Masto and a bipartisan group of senators are urging the Biden administration to work with the EU to permanently suspend or otherwise eliminate tariffs on American whiskey.

If Ambassador Katherine Tai and the White House are unable to broker a deal with the EU, the tariffs would be catastrophic for many American whiskey distillers. In turn, their whiskeys would become more costly for restaurant, bar, nightlife, and hotel operators. And, of course, for consumers.

Here’s to hope. Hope that a deal can be reached, and hope that somehow, some way, our elected officials will engage in more bipartisan efforts moving forward.

Bipartisan Support in the Senate

Below, the text of the letter that Sen. Cortez Masto (D-NV) sent to Ambassador Tai and the White House.

The following senators signed this letter in a show of bipartisan support:

Marsha Blackburn (R-TN)
Katie Boyd Britt (R-AL)
Mike Braun (R-IN)
Maria Cantwell (D-WA)
John Cornyn (R-TX)
Mike Crapo (R-ID)
Bill Hagerty (R-TN)
Tim Kaine (D-VA)
Mitch McConnell (R-KY)
Joe Manchin (D-WV)
Roger Marshall (R-KS)
Rand Paul (R-KY)
Gary Peters (D-MI)
Jacky Rosen (D-NV)
Mark Warner (D-VA)
Todd Young (R-IN)

If only restaurants and bars, venues where American whiskey is bought and sold, had received this type of support when seeking RRF replenishment.

The Letter

“Dear Ambassador Tai,

“We write today to request an expedited agreement with the European Union (EU) to secure the permanent removal of retaliatory tariffs on spirits and wines. While we applaud the Administration’s efforts to suspend retaliatory tariffs for five-years on spirits and wines in the WTO Large Civil Aircraft Dispute and the two-year pause on American Whiskeys in the steel and aluminum dispute, we are deeply concerned that a lack of a permanent fix risks the re-imposition of tariffs. As of now, a 50 percent tariff is set to hit American Whiskeys on January 1, 2024.

“Spirits have had a significant cultural impact in our country, and currently have a profound impact on the U.S. economy. In 2022 alone, U.S. distilled spirit exports reached $2.06 billion. But the impact of the retaliatory tariffs was devastating. For the American Whiskey industry, exports decreased from $702 million to $440 million, a loss of 20 percent between 2018 and 2021. In 2022, American spirits exports rebounded over 2017 pre-tariff levels – the last full year before retaliatory tariffs – due in large part to the suspension of retaliatory tariffs. For many in the hospitality industry and others such as retailers, grocers, importers and distributors, many of which are small, locally-owned businesses, the impact was severe, compounded by the onset of the Covid-19 pandemic.

“While we understand that you continue to negotiate towards a deal to settle the dispute related to steel, we believe that the targeting of spirits is extraneous. Likewise, a permanent fix is needed as the two-year pause on American Whiskey tariffs is set to snapback soon.

“Understanding that tariffs are a ‘tool in the toolbox’ in negotiating a deal, the imposition of additional tariffs on this industry would be detrimental. There are mutual benefits in finding a path forward, and our belief is that spirits and wines are a point where there can be consensus to limit the damage for all parties.

“We look forward to your support in finding a permanent fix for retaliatory tariffs on spirits and wines.”

Image: Daniel Norris on Unsplash

December 12, 2023by krghospitality krghospitality No Comments

Drink Donnybrook: Let’s Talk Screwdriver

Drink Donnybrook: Let’s Talk Screwdriver

by David Klemt

Is there vodka in there? Maybe.

As it turns out, the origins of one of the simplest cocktails on the planet—there are just two ingredients in a traditional Screwdriver—are a mystery.

Another interesting note about the Screwdriver: It’s likely a relatively new drink.

If the Screwdriver is an American invention, the earliest most believe it could have been created is the 1920s. That’s when Smirnoff sold the rights to North American distribution to a distiller in the US.

However, it’s possible the cocktail wasn’t invented until some time in the 1940s. Vodka didn’t really become popular among Americans until the ’40s. So, it’s conceivable that the Screwdriver is less than 100 years old.

Still, it’s difficult to believe that someone, somewhere didn’t think to add a splash of vodka to their orange juice in the 1800s. Or that someone didn’t think to “adjust” the taste of the vodka in their glass with a bit of OJ.

Either way, it’s pretty entertaining to know that we don’t have a definitive answer for who created the Screwdriver, where it was first made, and when. When we consider the fact that the recipe calls for just two simple ingredients, maybe it does make sense that we don’t know the who, where, and why. It’s so easy to make that it’s believable multiple people had the same idea around the same time, across the globe.

Of course, it wouldn’t be a Drink Donnybrook without checking into some origin theories. So, let’s dive in!

World War II

One theory involves WWII and the US Marine Corps.

It’s quite simple, really. During WWII, stationed overseas, perhaps a few Marines jazzed up their orange juice with a touch of vodka.

Oh, but wait. The Screwdriver may not be attributable to the USMC. It’s possible, according to another theory, that the former US Army Air Forces came up with drink and name when stationed in Ankara, Turkey.

As the predecessor to the Air Force, the USAF may hold claim to the Screwdriver.

If it’s one thing we need, it’s more fuel for the inter-service rivalry between the USMC and USAF.

Journalists

Two publications mentioned the Screwdriver in the 1930s and 1940s.

According to some historians, Journalism Quarterly at least made reference to a drink called the “Smirnoff Screwdriver” in 1938.

If that’s true, the classic cocktail predates WWII by a year. And if that’s true, it’s possible that American marines, airmen, or soldiers spread it around the world.

In 1949, Time magazine mentioned the Screwdriver. According to the writer, the cocktail was the newest drink grabbing attention at the Park Hotel in New York. Apparently, American engineers, Balkan refugees, and Turkish spies loved the drink.

Interestingly, if Time‘s reporting is accurate, it’s possible the supposed Turkish spies frequenting the Park Hotel bar got the name of the drink from American airmen.

Since apparently no bartenders who worked at the Park Hotel appear to have taken credit for it back in the ’40s, it’s unlikely it was created there.

Roughnecks

Okay, so you’re an oil worker. It’s the 1950s and you’re working in the Persian Gulf.

You’re performing back-breaking, dangerous tasks in oil fields. Maybe you need a pick-me-up, and maybe that pick-me-up involves mixing orange juice and vodka together.

But…you don’t have a barspoon. You certainly don’t have a swizzle stick. And you don’t have a coffee stirrer handy.

What you do have is a screwdriver. That screwdriver will definitely stir a drink. It doesn’t take time for this vodka-orange juice concoction to get the name “Screwdriver” because of the stirring utensil.

Well, that’s one theory, anyway.

Two days from now, December 14, you can share all those stories with your guests. Why? Because that’s National Screwdriver Day, a time to celebrate one of the simplest cocktails ever made.

Of course, you and your team can make the Screwdriver your own. Top-shelf vodka, the finest and freshest hand-squeezed orange juice (maybe even blood orange juice), any number of garnishes or rims, a touch of sparkling wine or water… The simpler the drink, the easier it can be to riff on it.

Cheers!

Image: Ryutaro Tsukata on Pexels

December 11, 2023by David Klemt David Klemt No Comments

FTC Targets Restaurant Fees and Surcharges

FTC Targets Restaurant Fees and Surcharges

by David Klemt

The Apex Building, also known as the Federal Trade Commission Building in Washington, DC.

Well, that didn’t take long. Less than two months after asking for the public’s input, the Federal Trade Commission is proposing legislation targeting additional fees and surcharges.

The proposed rule is known as the “Unfair or Deceptive Fees” rule. As one may imagine, the FTC is going after hidden and so-called “junk” fees.

As it stands, according to multiple outlets, this rule would prohibit restaurant and bar operators from surcharges that are commonplace. For example, larger-party fees, delivery surcharges, and even credit card processing charges would be banned by the rule.

Instead, operators would be compelled to list total prices on menus, whether for goods or services. Further, the FTC is directing operators to provide larger groups with “larger group” menus. These separate menus would show total prices calculated to include any surcharges.

Even further, it’s being reported that the FTC is also addressing tips. The Commission’s rule directs operators who charge service fees in place of tips to remove the fee and return to tipping.

Interestingly, the National Restaurant Association is reporting that the FTC never identified restaurants as a targeted industry when asking for public comments about junk fees. However, other sources claim that restaurants were indeed included when the FTC put forth the request for public feedback.

Regardless, it’s a fair statement to say that the Commission doesn’t understand restaurant operation and costs. It appears that the FTC either didn’t work with any operators when drafting these proposed rules. Or, if they did seek out restaurant operator input, they put very little stock into it.

Costing Independents

One thing that’s clear is these proposed rules will cost operators. In particular, compliance will cost independent operations, which account for nearly 70 percent of American restaurants.

According to the NRA, the cost of changing menus will cost nearly $5,000 per operator, for starters.

“The FTC doesn’t take the realities of the restaurant industry into consideration,” reads the Association’s fact sheet. “Its estimated compliance cost—$3.5 billion—would equal a cost of $4,818.27 per operator for menus alone. Small independent operators run on a 3-5% margin and make an average of $45,000/year. The cost of making this change would be approximately 10% of their total income.”

As independent operators can attest, credit card swipe fees are a dynamic cost that affects them disproportionately in comparison to their chain restaurant counterparts. Since these fees are calculated on a per-transaction basis and not fixed, adjusting menu prices to comply with the FTC’s rule puts them at a costly disadvantage.

Then there’s the simple fact that when restaurants raise prices, traffic tends to drop. When traffic drops, revenue goes with it. And when traffic and revenue drops, hours are cut back, and people lose their jobs.

Harmful Legislation

As far as I can tell, this is another example of a government agency attempting to impose rules on an industry it doesn’t understand.

When drafting legislation that affects restaurants, a group of operators and industry advocates that truly represents those who will be impacted should be impaneled. Input should be taken into thoughtful consideration before drafting rules, and drafts should be provided to the panel to receive feedback.

Unfortunately, the past few years have made it clear that our industry has very few friends the federal government. Our lobby, such as it is, simply isn’t respected as valuable enough to warrant consideration before imposing harmful rules on the industry.

This, despite the fact restaurants and bars in America employ more than 12 million people. That’s a lot of voters too many elected lawmakers are willing to dismiss as unimportant.

Image: ipse dixit on Unsplash

December 8, 2023by David Klemt David Klemt No Comments

af&co. x Carbonate: 2024 Trends to Watch

af&co. x Carbonate: 2024 Trends to Watch

by David Klemt

Marketing and creative agencies af&co. and Carbonate Group‘s 16th annual Hospitality Trends Report provides in-depth insight across several categories.

This is an in-depth, insightful report operators should review in its entirety. The “Sweet Sixteen” edition of this yearly report is available for download here.

There are two interesting details toward the end of af&co. and Carbonate’s report. First, a list of 2023 clients. Second, an explanation for the design of the report itself.

This makes sense: Carbonate is a creative agency that works in the hospitality space, after all. Further, af&co. is a hospitality industry marketing agency.

Now, I won’t be sharing every trend or insight found in these two agencies’ report. Rather, I’m highlighting a number of items across four of the report’s six categories. Again, I think operators and leadership team members should download the report for themselves.

Food

While af&co. and Carbonate identify specific cuisines and items that are trending, it’s their 10,000-foot view of food that I find most compelling. In terms of the big picture, “rigid” adherence to authentic cuisine is falling out of favor.

Chefs, in the agencies’ opinions, are taking a more modern approach to menus. Instead of following the “rules” of certain cuisines, they’re creating dishes and programs that defy labels. Of course, for those who feel the need to label, one could call this approach “contemporary fusion.”

Examples given are Good Luck Gato’s Okonomiyaki Baked Potato, and the Birria Dumplings at Little Bull.

Cuisine Trends

Of course, af& co. and Carbonate also zoom in on food. Their Cuisine of the Year goes to Korean.

Dessert of the Year goes to the Pavlova or Eton Mess. So, one can argue that operators should connect with their back-of-house teams about meringue-based desserts.

Other food trends include making pastries with buckwheat; getting inventive with mortadella; serving borek in snack and entree size; and Brazilian-style pizza.

However, it’s a presentation trend that stood out the most to me. Accompanied by a timeline complete with images, the agencies state confidently that we’re in the “Crescent Moon” era of plating.

Visualize a plate, then place all of the food along the edge, with roughly two-thirds of the space open. That’s the crescent moon presentation.

Beverage

A number of the trends in this section aren’t exactly new. That tells me that some are likely on the brink of moving from trend to ubiquity.

That, or they’re at risk of bumping against their expiration date.

Two trends that have been popping their fins out of the sea of cocktails for a bit make it into the af&co. and Carbonate report. One is clarified cocktails.

Spend a bit of time looking up cocktails on social media and you’ll see these are a bit divisive. Some bartenders are all for them, some appear to absolutely despise this trend. Guests, however, seem to like the novelty of well-known, opaque or translucent classic turning transparent.

Another drink trend? Culinary cocktails. For food-driven concepts, it makes perfect sense to encourage the bar team to work closely with the kitchen team. Offering culinary cocktails is one method of pulling a concept’s threads tighter, telling a more complete story.

Along those lines, the agencies identify another divisive cocktail trend: cheese.

Personally, cocktails that feature cheese aren’t my thing. However, these drinks are, at the minimum, going to grab a guest’s attention. And those who order these drinks aren’t likely to forget the experience any time soon, good or bad.

That last point is important for operators and their teams to remember. A negative experience can be more powerful and stick with a guest longer than a positive one. So, pursue trends with caution.

Hotel

One of the biggest hotel developments the Hospitality Trends Report identifies is the dual-brand hotel. This is also a trend with which KRG Hospitality is well acquainted, both through industry research and client projects.

So far, the most common approach tends to include two towers, a shared lobby and fitness center, and shared F&B concepts. However, there are properties that incorporate not only brand-specific design for each tower but separate the bars and restaurants as well.

Notably, Marriott opened the first-ever tri-brand hotel in Nashville in 2019. The hotel and resort colossus combined an AC Hotel, a Residence Inn, and a SpringHill Suites.

Another interesting hotel trend? Eco-friendly, pre-fab construction. An excellent example of this approach is Moliving. To learn more about this brand, check out Bar Hacks podcast episode 68 with Jordan and Hanna Bem.

Interest by consumers in supporting eco-friendly brands informs two other trends identified by af&co. and Carbonate. One of these is hotels and resorts including e-bikes among their amenities.

Another is rewarding guests for engaging in a number of green initiatives. For example, cleaning up the beach in front of a hotel, or helping to plant trees on or near the property.

Speaking further of amenities, hotel and resort operators are likely aware that if they have courts for racquet sports, they need to include pickleball.

Design

Operators considering a refresh or starting from a clean slate for a new space may want to work with a designer on the following approach: maximalism.

According to the 16th annual Hospitality Trends Report, this bold, playful design language is on the rise. Following this trend, af&co. and Carbonate think that maximalism is working particularly well for “concept-driven, design-forward” bars.

As far as colors and materials operators may want to ask designers about, the agencies suggest pink, bronze, gold, and velvet. These colors are warm and welcoming, exactly what a hospitality venue should be.

To download the Hospitality Trends Report, click here. Two categories not covered in this article are Marketing Ideas and Social Media Trends, so follow that link!

Image: Mason Tuttle on Pexels

December 5, 2023by David Klemt David Klemt No Comments

Banfi and One Warm Coat Launch Partnership

Banfi and One Warm Coat Launch Partnership

by David Klemt

Wine producer and importer Banfi Vintners is partnering with non-profit One Warm Coat to help people in need and encourage others to host coat drives.

For anyone unfamiliar, One Warm Coat is a national 501 (c)(3) nonprofit operating throughout the US. Established in 1992, the nonprofit has helped organize nearly 50,000 coat drives. More than 5,500 of these drives took place during the 2022 to 2023 season, providing in excess of 550,000 coats.

So far, with their partners, they’ve collected and distributed close to eight million coats. These partners include Land’s End, J.Crew, Todd Snyder, Duluth Trading Co., and now Banfi.

To launch their partnership, Banfi seeded the program with a donation that will provide 50,000 coats. In announcing this partnership, Banfi and One Warm Coat hope to encourage others to give back, host coat drives, and help those in need within their communities.

Canadian operators and their teams can find One Warm Coat partners by clicking here and searching their city. I found partners in and around Toronto, Vancouver, Calgary, and Edmonton.

In addition to helping provide people in need with coats, sustainability is key to One Warm Coat’s mission. To date, the organization has helped keep 19.4 million pounds of clothing out of landfills.

Charity Navigator, which rates the trustworthiness of charities, gives One Warm Coat a score of 98 percent.

To learn more, please review the press release below.

BANFI VINTNERS PARTNERS WITH ONE WARM COAT TO SUPPORT LOCAL COMMUNITY

Italian wine producer and importer offers support to individuals in need through seasonal coat drive

NEW YORK, NY—Banfi, producer and importer of fine wines, proudly announces its partnership with national non-profit organization, One Warm Coat. Banfi kicked off the program with a donation that will warm 50,000 people in need.

“One Warm Coat is thrilled to team up with Banfi this holiday season to share warmth with those in need across the country while promoting volunteerism and environmental sustainability,” shares Beth Amodio, President and CEO, One Warm Coat.

In addition, the partnership with One Warm Coat allows Banfi to spread the word and encourage coat drives at various retail and restaurant accounts across the country, extending the program’s reach and multiplying the number of donations collected. One example can be found not too far from Banfi’s NY headquarters; based in upstate New York, Banfi’s distributor partner, Empire Merchants North has made it a key focus to promote the brand’s initiative on their website and social channels to bolster the partnership and encourage dozens of retailers to support the cause.

“Empire Merchants North proudly joined Banfi’s One Warm Coat program to extend our commitment beyond beverages. Embracing social responsibility, we believe in making a positive impact by contributing to the well-being of our community, aligning seamlessly with Banfi’s philanthropic mission. Our enthusiastic employees joyfully embraced this initiative, embodying our shared commitment to making a meaningful difference in the lives of those in need,” shares President and CEO of Empire Merchants North Eric Pfeil.

“One of our favorite aspects of working with One Warm Coat is its ability to support the local community. The donations stay in the community where they’re collected, so it’s truly heartening to see the widespread response in the market,” shares Banfi President and CEO Cristina Mariani-May.

About Banfi Wines

Banfi, producer and importer of fine wines, was founded in 1919 and is today woman-owned and operated by third-generation family proprietor Cristina Mariani-May. Banfi is the sole U.S. importer of the Mariani family’s internationally renowned wine estates in Italy: Castello Banfi of Montalcino, Tuscany, and Banfi Piemonte of Strevi, Piedmont. Castello Banfi is credited with pioneering a new era in Brunello and bringing the wine world’s attention to Montalcino, while Banfi Piemonte produces the family’s sparkling wines. Banfi’s wide range of wines offers affordable luxury and includes the flagship Brunello di Montalcino, Super Tuscans, Tuscan Pinot Grigio, Chianti, Sparkling and more varieties.

About One Warm Coat

One Warm Coat is a national cloud-based 501 (c)(3) nonprofit organization that provides free coats to individuals in need. Since 1992, One Warm Coat has facilitated 49,000 coat drives across the country, collecting 8 million coats that have been distributed through more than 1,500 nonprofit partners. Individuals and organizations can get involved by donating coats, holding coat drives, and making financial donations. One Warm Coat believes in each person’s right to shelter from the elements and is committed to sharing warmth, without discrimination, one coat at a time.

Image: Markus Spiske on Unsplash

November 21, 2023by David Klemt David Klemt No Comments

2023 State of the Menu: Datassential

2023 State of the Menu: Datassential

by David Klemt

The annual 2023 State of the Menu by Datassential includes an interesting metric to gauge restaurant recovery: menu size by segment.

Hosts Jack Li, Mike Kostyo, and Claire Conaghan discuss a handful of topics during this webinar. Host Li touches on food-forward cities at the beginning of this presentaiton. Kostyo shares some of the most innovative menu items out there right now. And Conaghan dives deep into menu trends.

Industry professionals interested in watching this webinar on demand can register to do so here.

There are a handful of metrics people are using to measure post-pandemic restaurant recovery. Labor is, of course, receiving a lot of attention. People are also tracking traffic, average check size, revenue, and profits.

One metric Datassential is keeping tabs on is menu size per restaurant segment. Additionally, they’re tracking each segment’s top-growing food and beverage items.

Notably, however, in tracking menu size, Conaghan focuses solely on food and non-alcohol beverage items, omitting catering and alcohol.

Chains vs. Independents

Starting things off, Conaghan addresses the overall menu size trend. That is, menus are noticeably smaller in comparison to pre-pandemic sizes.

Interestingly, chain restaurants don’t appear to be in any rush to move away from this trend. In fact, Conaghan notes that chains appear to be further reducing the size of their menus. This has been the trend over the past 12 months.

According to Conaghan, fine dining also seems to be happy to shrink their menus. Menu size shrunk the most among restaurants in this segment. In comparison, quick-service menu sizes decreased the least.

However, independent restaurant operators appear to be going in the opposite direction from their chain counterparts. In contrast, indies have been growing the size of their menus the past 12 months.

Menu Size by Segment

Per Conaghan, the only segment to reach pre-pandemic menu size is fast casual. In fact, this category of restaurant is often exceeding pre-pandemic items-per-menu size.

This increase in menu size is attributable to operators “leaning into” core cuisine items. For example, sandwiches, Mexican entrees, and pizza.

However, the fastest-growing food item on fast-casual menus is the chicken wing. According to Conaghan, it’s easy for operators to innovate with chicken wings.

A restaurant doesn’t have chicken wings? All they have to do is add them, starting with simple preparations. If a restaurant does have chicken wings on the menu already, innovation is as simple as adding new flavors.

As far as the fastest-growing drink for fast-casual restaurants, it’s dessert beverages.

QSR, Casual Dining, and Midscale

These three segments are “very, very close” to reaching pre-pandemic menu sizes.

As midscale operators are likely very aware, this segment tends to have the largest menus. I wouldn’t be surprised, therefore, if a number of midscale concepts review their items per menu, their costs, and decide they can perform well with slightly smaller menus moving forward.

Unsurprisingly, chicken wings are the food item growing most quickly on QSR food menus. Oh, and barbecue chicken wings are the fastest-growing food item among casual dining restaurants.

Perhaps a bit more eyebrow-raising is the fastest-growing beverage type for QSRs: energy drinks. Boba and flavored iced teas are growing fastest on casual-dining drink menus.

For midscale restaurants, dessert samplers are the fastest-growing food items. Think “dessert charcuterie” when trying to picture a dessert platter. Another way to think about the dessert sampler is a static dessert cart with small bites of each dessert on the menu.

Fine Dining

Again, this segment is the furthest from pre-pandemic menu size. And, again, operators in this category seem happy with this trend.

An interesting note Conaghan makes about this segment is what many operators are using to fill out their menus: desserts. This is, she says, an area where fine dining can differentiate itself from other concepts.

Per Conaghan, bao, applesauce, and summer squash are growing the fastest on fine-dining food menus.

Now, I may have slipped into a fever dream during this portion of the Datassential webinar. Because unless I’m mistaken, the Shirley Temple has been identified as the fastest-growing beverage in the fine-dining space.

Pricing

Okay, so this segment of the 2023 State of the Menu webinar isn’t really a recovery metric.

However, it’s interesting, and something Jack Li says about chain restaurant pricing made me chuckle.

Most Expensive vs. Least Expensive

First, some straightforward data.

The following list identifies the five most-expensive ZIP codes for chain restaurant menu pricing. Anyone who wants the full list of 15 most-expensive ZIP codes can watch the webinar.

10036 (New York, NY)
96707 (Kapolei, HI)
98902 (Yakima, WA)
96815 (Honolulu, HI)
99503 (Anchorage, AK)

It’s understandable to think this would consist entirely of New York City, Los Angeles, or San Francisco ZIPs. But when we consider what it costs operators to import food to Hawaii and Alaska. Additionally, Washington and New York are among the states with the highest minimum wage. Operators need to recover those costs somehow.

And now the five least-expensive ZIP codes:

78526 (Brownsville, TX)
75224 (Dallas, TX)
76106 (Fort Worth, TX)
31907 (Columbus, GA)
31701 (Albany, GA)

Pricing Logic

Now, on to what Li says during the webinar that makes me laugh.

Nationwide, the average price of a McDonald’s Big Mac in the US is $5.26. (A caveat: This webinar took place in October. This price may have increased or decreased by now.)

However, the lowest price for a Big Mac is $3.49 at a location in Wilburton, Oklahoma.

So, what’s the highest price, and where can one find these pricey Big Macs? Three McDonald’s locations sell the burger for $8.29. That’s nearly two-and-a-half times the lowest-priced Big Mac.

Summarizing pricing variations among chain restaurants succinctly, Li made me laugh with the following: “Store pricing often just doesn’t make sense.”

Going further, Li says Datassential shows that the more franchised a restaurant chain is, the more variances in pricing will occur.

The full webinar can be viewed here.

Image: Leonardo Luz on Pexels

November 20, 2023by David Klemt David Klemt No Comments

Datassential Ranks Food-forward Cities

Datassential Ranks America’s Most Food-forward Cities

by David Klemt

Let’s take a look at food and beverage intel platform Datassential’s ranking of the 158 most food-forward cities in America as 2023 comes to a close.

We are, in part, reviewing this list because of Wallethub’s “Best Foodie Cities in America” report. You can find our thoughts on that ranking here.

To summarize, however, Wallethub prioritizes “wallet-friendliness,” or “the best and cheapest” cities for foodies. In contrast, Datassential’s ranking is a scientific attempt to quantify the “food-forward” status of a given city.

“It’s the diversity of cuisines, the prevalence of emerging foods and flavor trends and residents’ appetite for varied menus, that make a city food forward,” writes Samantha Des Jardins, content marketing manager at Datassential.

We at KRG Hospitality are big fans of Datassential and find the company to be a credible source of industry insight. Earlier this year they tackled video versus static photography, and the flavors and menu items they predicted would be big in 2023.

To review Datassential’s ranking and download the full list for yourself, click here.

The Top 25 Food-forward Cities

Alright, I know why you’re here. Below, you’ll find the highest-ranked cities on the Datassential list.

(Note: Due to the scoring, some cities are tied in terms of overall points. Where this is the case, it has been noted.)

San Francisco, California
Los Angeles, California
Miami, Florida
Washington, DC
San Diego, California
New York, New York
Houston, Texas
Monterey, California
Las Vegas, Nevada
Austin, Texas
Sacramento, California
West Palm Beach, Florida
Atlanta, Georgia
Dallas, Texas (tie with Atlanta)
Albuquerque, New Mexico
Phoenix, Arizona
Portland, Oregon
Palm Springs, California
Seattle, Washington
Orlando, Florida
Denver, Colorado (tie with Orlando)
Honolulu, Hawaii (tie with Orlando and Denver)
Salt Lake City, Utah
Tampa, Florida
Fresno, California (tie with Tampa)

So, the top ten—the entire top 25, really—are most likely not much of a surprise. When I talk about cities as the “usual suspects” for rankings like these, I’m talking about New York, LA, San Francisco, Miami, etc.

However, not every usual suspect is among the top 25. Notably, Chicago just fails to make the cut, earning number 26 on this list. In fact, five “big cities” are absent from Datassential’s top ten: Dallas, Phoenix, San Antonio, Chicago, and Philadelphia.

Another interesting detail? Whereas Orlando holds the number-one spot on Wallethub’s list, it’s number 20 on Datassential’s ranking.

Of their respective top tens, the two lists have just five cities in common: Miami, San Francisco, San Diego, Las Vegas, and Austin.

Methodology

Since the two lists are vastly different when we contextualize what they quantify, it should come as no surprise that Datassential and Wallethub’s methodologies are likewise dissimilar.

Whereas Wallethub scored affordability, and diversity, accessibility, and quality, Datassential weighed different metrics.

For their “Most Food-forward Cities in US,” Datassential scored the following:

Race to 90;
Ethnic restaurant diversity; and
Trend-forwardness.

During Datassential’s annual State of the Menu webinar, Jack Li, executive chairman, board of directors explained each of these metrics.

Race to 90

The number different cuisine types required in a particular metro area before reaching 90 percent of restaurants.

For the curious, Miami is the most-diverse city by this metric.

Ethnic Restaurant Diversity

Datassential asks the following question to measure this metric: What is the proportion of ethnic restaurants compared to all restaurants in a metro area?

Trend-forwardness

Based on a dataset developed by Datassential which tracks a number of points, from food and drink items to flavors, keywords, and beyond.

The company continuously polls consumers by ZIP code to measure consumer knowledge of upcoming trends, then aggregates the ZIP codes to measure a metro area.

The Bottom Eleven

Why am I listing the bottom eleven rather than bottom ten? There’s a tie for number 149 among these 158 cities.

There are nearly 800 cities in the US with populations of 50,000 or more. Therefore, it’s reasonable to argue that even the bottom of this list boast respectable food scenes.

Youngstown, Ohio
Rockford, Illinois
Peoria, Illinois
Johnstown, Pennsylvania
Billings, Montana
Traverse City, Michigan
Sioux Falls, South Dakota
La Crosse, Wisconsin
Green Bay, Wisconsin
Fargo, North Dakota
Wausau, Wisconsin

In case you’re wondering, Datassential and Wallethub’s lists don’t share any bottom ten (or eleven) cities.

So, there you have it: San Francisco earns the top spot among Datassential’s food-forward cities. And Wausau earns number 158, which is still notable.

Image: Daiwei Lu on Unsplash