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Bartender straining cocktail
by David Klemt David Klemt No Comments

3 Bar Hacks Episodes for Sober October

3 Bar Hacks Episodes for Sober October

by David Klemt

Bartender straining cocktail

We’re just two weeks away from Sober October so here are three Bar Hacks podcast episodes to get you ready for this important month.

Over the course of 100-plus episodes we’ve spoken with a handful of non-alcohol brands. These, along with other alcohol-free brands, should be on your radar.

In fact, they deserve spots on your backbar and placement on your menus. The latest estimate is that around 40 percent of Americans don’t consume alcohol. In Canada that number is roughly 33 percent.

However, those numbers don’t paint a complete picture. Over the past few years there has been increasing interest in “sober curiosity.” In this movement, people abstain from drinking alcohol from time to time rather than abstaining permanently.

Now, we tend to associate the month of January with sobriety, either permanent or temporary. Clearly, however, October is also a month where people choose to not imbibe.

The Sober Guest Experience

The following should go without saying but let’s cover it anyway. Some sober people do, in fact, spend time in bars and nightclubs.

Just as that should go without saying, so should this: Your sober guests deserve every bit as great an experience as guests who are drinking alcohol.

Moreover, sober guests deserve a guest experience free of discomfort or isolation. In short, you should seamlessly provide the same level of service at the bar to sober guests as those who enjoy alcohol.

No, it’s not enough to menu water, sugary sodas, lemonade, and tea. Sober guests should be comfortable coming to your bar. Like guests who consume alcohol, sober guests should be able to order a drink that doesn’t make them feel different or singled out.

So, put quality non-alcohol beers on your menu. Create a number of signature zero-proof cocktails. Serve both with the same attention to detail as presentation as their full-alcohol counterparts.

“I’m a professional, I want to create,” says Paul Mathew, founder of alcohol-free aperitif brand Everleaf and Bar Hacks guest. “I want to do something I’m proud of.”

Approach your alcohol-free program the same way as Mathew, a bartender and operator himself. Be professional, be creative, and be mindful of your sober guests’ experience.

Episode 28 with Tim Rita

Lyre’s Spirits crafts alcohol-free spirits that masterfully mimic their full-proof counterparts. Host David Klemt sits down with Lyre’s brand ambassador, bartender, and buddy Tim Rita to chat about the brand. In this episode you’ll learn about one of the fastest-growing brands in one of the fastest-growing beverage categories. For the alcohol-free Mai Tai mentioned on the podcast, click here.

Listen now.

Episode 31 with Ted Fleming

Ted Fleming, entrepreneur and CEO and founder of Partake Brewing, stops by the Bar Hacks podcast to talk with host David Klemt. The two discuss the founding of Partake Brewing and the importance and growth of the non-alcohol beer category. Also, how operators can succeed with non-alc, advice for entrepreneurs, and more. Visit the Partake Brewing website to learn more. Connect with Partake on Instagram, Twitter and Facebook.

Click here to listen.

Episode 81 with Paul Mathew

Paul Mathew, bartender, bar owner, and founder of Everleaf, sits down with Bar Hacks podcast co-host David Klemt. In this fun and informative episode, Paul shares his journey through bartending and bar ownership, and his entry into the drinks business. Non-alcoholic aperitif brand Everleaf is the culmination of Paul’s many years as a conservationist botanist, knowledge of plants, and nearly 30 years in the bar business.

The Everleaf portfolio consists of three unique expressions and a new RTD line. Shortly, Everleaf will begin distribution throughout the United States, and there are plans for Canada and Australia in the future. To learn more, vist the Everleaf website and follow Everleaf on Instagram and Facebook.

Listen to this episode here.

Image: Jia Jia Shum on Unsplash

Jack o' lantern and smoke
by David Klemt David Klemt No Comments

Pumpkin Spice Season Descends Upon Us

Pumpkin Spice Season Descends Upon Us

by David Klemt

Jack o' lantern and smoke

Once again, the unstoppable march of the spooky season is upon us, bringing with it a frightening assortment of pumpkin spice items and expectations.

In the blink of an eye, hordes will descend on your restaurant or bar. “Pumpkin spiiiiiice,” they’ll croak.

Okay, so that’s overly dramatic. For the most part, pumpkin spice season is anything but scary. And really, very few people will transform into singularly focused pumpkin spice zombies.

However, fall is nearly here. So, you do need to finalize your fall/autumn menu. Beginning in September, that really does mean considering offering at least one pumpkin spice LTO item.

Interestingly, though, pumpkin spice may not deserve its perception as the flavor of fall. According to Datassential, there are ten flavors that index high enough to give pumpkin spice a challenge for the fall throne.

What are they? Well, it just so happens that Datassential has those answers, along with a bit of useful advice.

Lord of the LTO

Recently, Datassential released “Food Industry Trend Report: 2022 Pumpkin Spice Season.” As the research firm points out, pumpkin spice seems to be encroaching on summer more each year.

How far away are we, I wonder, from pumpkin spice claiming summer for itself? Will we be subjected to pumpkin spice dry rubs at summer barbecues? Is some intrepid operator going to create a pumpkin spice lemonade?

Those terrifying questons aside, pumpkin spice season coming earlier means more opportunities to benefit from LTOs. Just as it seems that pumpkin spice is descending upon us earlier and earlier, it also seems to dominate the LTO space.

In fact, per Datassential research, major chains executed 174 pumpkin spice LTOs. Now, that’s still with a five-percent drop in menuing for pumpkin space over the past 12 months. Further, that number doesn’t include small, regional chains and independents who also launched pumpkin spice LTOs.

Of course, there are also other fall flavors that deserve a place on operators’ menus. And they’re perfectly cromulent as LTO drivers.

Fall Flavor Favorites

To inspire operators to create LTOs that entice consumers this fall, Datassential has identitied ten flavors on which to focus. Helpfully, they separate them into two main categories.

Top five sweet fall flavors:

  • Vietnamese cinnamon
  • Spicy ginger
  • Allspice
  • Eggnog
  • Pumpkin pie

Top five savory flavors:

  • Coconut milk
  • “Oktoberfest”
  • Mustard cream
  • Turkey gravy
  • Cranberry sauce

Personally, I can see operators and their teams needing to get creative to leverage mustard cream and turkey gravy. Interestingly, Datassential suggests a few flavors not on either list above.

According to their report, Datassential expects apple and blood orange to be popular for LTOs this year. According to the firm, apple was popular last year. When it comes to blood orange, Datassential says 38 percent of consumers like or love the flavor.

Whichever flavors you choose, Datassential has the following advice, which we co-sign: Ensure your LTOs are fresh; make sure they’re easy and quick to make; and don’t discount them. In fact, you should create premium LTOs that come with a premium price.

Image: Colton Sturgeon on Unsplash

Red neon hand sign over a cocktail
by David Klemt David Klemt No Comments

Discover the World’s 50 Best

Discover the World’s 50 Best with this Helpful Tool

by David Klemt

Red neon hand sign over a cocktail

You may be familiar with the World’s 50 Best Bars and the World’s 50 Best Restaurants rankings, but do you know about their Discovery tool?

On episode 82 of the Bar Hacks podcast, Mark Sansom mentions this powerful and helpful tool. Sansom, for those who have yet to listen to the episode, is the content director for the World’s 50 Best Bars.

Put plainly, the World’s 50 Best rankings are powerful and influential. As Sansom says, when the organization shouts, people listen. Making the 100 to 51 or 50 to one list can change a restaurant or bar’s business. Exposure, traffic, revenue, status, longevity… The restaurant and bar lists are game changers for those who work hard enough to earn a spot.

However, the World’s 50 Best, as the name suggests, ranks just a few hundred restaurants and bars:

So, the organization put their heads together. What if they could increase the chances that thousands of venues could find themselves on the radar of millions of people across the world? What could that do for a much larger swathe of deserving restaurants and bars?

50 Best Discovery

Enter, the 50 Best Discovery database.

“That’s the more egalitarian face of 50 Best, and that’s where we’re really excited about moving in the future,” says Sansom.

According to Sansom, there are more than 2,500 restaurants and bars just waiting for, well, discovery. It is, as he says, “the world’s most authoritative database on restaurants and bars anywhere.”

Compellingly, this is more than just a lonely input field chilling out on a webpage. Rather, there’s also a slideshow of 50 Best editor’s picks to scroll through. In using the tool for this article I discovered the following venues without even scrolling:

  • Franklin Barbecue in Austin, Texas
  • Cal Pep in Barcelona, Spain
  • Amass in Copenhagen, Denmark
  • Fyn Restaurant in Cape Town, South Africa

In other words, this tool is aptly named: The mission is discovery, and I’d say that mission is well on its way to achievement.

North America Results

Given the potential of the 50 Best Discovery database, I of course took it for a spin. You can do the same by clicking here.

Below, my results. In the interest of full transparency, it appears some cities in North America could use some work.

However, I feel confident that the 50 Best Discovery database will improve over time. After all, this is a new tool. Remember, the North America 50 Best Bars list is also brand new. As the organization recognizes more regions and venues, they’ll develop their database further.

Calgary, Alberta, Canada

  • Proof

Toronto, Ontario, Canada

  • Bar Raval
  • BarChef
  • The Shameful Tiki Room

Vancouver, British Columbia, Canada

  • Botanist
  • Boulevard Kitchen & Oyster Bar
  • The Keefer Bar

Las Vegas, Nevada, USA

  • Greene St. Kitchen
  • Herbs & Rye
  • Wing Lei

Nashville, Tennessee, USA

  • Bastion
  • The Catbird Seat
  • Pearl Diver

Philadelphia, Pennsylvania, USA

  • Vedge
  • Zahav

Image: Marcus Loke on Unsplash

Reserved seats at a bar
by David Klemt David Klemt No Comments

Date Night Desires and Dealbreakers

Date Night Desires and Dealbreakers

by David Klemt

Reserved seats at a bar

Focusing on date night, guest experience and retention tech platform SevenRooms is sharing their latest data-driven report.

Their “Date Night Diner Report” is another successful collaboration with YouGov. Previous reports from this partnership include:

One of the reasons we at KRG Hospitality appreciate and recommend SevenRooms is their dedication to data. The platform’s commitment to sharing the data they collect to the benefit of operators is impressive.

“A resurgence of the American date night is here, and these date night diners are flipping the script on what that experience should look and feel like,” says Allison Page, co-founder and chief product officer at SevenRooms.

So, operators who want to succeed with date night should review this new report. In fact, all operators would be wise to read this report. After all, it addresses reservations, waitlists, walk-ins, and much more.

Released today, this brand-new report can be downloaded here. Read the press release here.

Date Night Details

A lot has changed over the past two-plus years. What hasn’t changed are the two most popular date nights in the US: Friday and Saturday.

Both Friday and Saturday night are preferred by 26 percent of the 763 survey respondents who go on dates. In total, SevenRooms and YouGov surveyed 1,153 individuals.

Generally speaking, these dates are return visits. People who go on dates tend to make reservations at restaurants they’ve dined at previously.

However, 46 percent of such guests are open to reserving a table at a restaurant they haven’t visited before. And speaking of those tables reservations, 53 percent are for two people.

Looking at two major populations, tables for two are the most popular reservations. In New York, they account for 50 percent of reservations. That number increases to 56 percent in Los Angeles.

Interestingly, however, is this bit of date: 53 percent of Americans don’t make reservations for date night. Rather, they’re walk-in guests, meaning they’ll likely become waitlist guests.

Date Night Desires

So, now operators know that the majority of today’s date-night reservations are for two. That doesn’t mean setting aside two-tops and side-by-side seats at the bar is enough for success.

No, there are also guest expectations to consider. SevenRooms identifies the following as the top date-night desires:

  1. A complimentary cocktail or dessert. (33 percent)
  2. Ability to earn extra rewards (24 percent), highlighting the value of loyalty programs.
  3. Incentives that encourage repeat date-night visits. (23 percent)

Furthermore, personalization continues to be a key factor in the dining decision. One-third of guests consider the ability to personalize their dining experience more important than factors such as menu variety or receiving their order quickly.

Date Night Dealbreakers

Of course, if there are desires there are also dealbreakers.

According to SevenRooms, the following are the dealbreakers operators must avoid:

  1. People on a date receiving their meals at different times. In this case, more than ten to 15 minutes apart. (45 percent)
  2. The restaurant being so loud the guests on their date can’t hold a conversation. (43 percent)
  3. A restaurant not having the menu items the guests were looking forward to ordering. (31 percent)
  4. Being sat too close to another table. (31 percent)
  5. Sitting next to a table speaking “too loudly.” (26 percent)
  6. The restaurant being so crowded that a guest can’t find their date. (24 percent)

How important is it to avoid these dealbreakers? Well, the survey respondents say they won’t return to a restaurant if they experience any of them.

To read the full report, click here. And to learn more about SevenRooms, listen to Bar Hacks episode 24, featuring SevenRooms CEO Joel Montaniel.

Image: Dmitri Nesteruk on Unsplash

Guests sitting at the bar inside a restaurant
by David Klemt David Klemt No Comments

Datassential’s State of the Operator 2022

Datassential’s State of the Operator 2022

by David Klemt

Guests sitting at the bar inside a restaurant

The latest addition to the Datassential FoodBytes research series shares insights into the top three challenges most—if not all—operators are facing.

Now, some of what the report reveals paints a bleak picture. Inflation, the labor shortage, and supply chain issues persist even past the midway point of 2022.

However, operators are a tenacious and innovative group of business owners. Of course, that tenacity seems to manifest in people thinking this industry can weather any storm. That perception can come at operators’ detriment. Exhibit A: The Inflation Reduction Act of 2022 not including replenishing of the RRF. But, I digress.

“The State of the Operator & the Road Ahead,” which you can download here, is helpful and informative. As you may be aware, we’re fans of Datassential and their FoodBytes reports. In fact, you can find our synopses of FoodBytes reports here and here.

Below are some key points that operators should be aware for consideration. I strongly urge you to download this free report today.

Operator Outlook

First, let’s take a look at traffic. As Datassential points out, some hospitality business segments are performing better than others currently.

In large part, this is due to two factors: People working from home, and people returning to travel. So, operators who rely heavily on commuters and in-person workers are struggling. On the other hand, operators inside or around hotels are, per Datassential, performing the strongest at the moment.

Interestingly, though, nearly half of operators (47 percent) are seeing an increase in traffic in comparison to pre-Covid levels. Fourteen percent of operators are reporting no change in traffic. Unfortunately, traffic is lower for 39 percent of operators.

Next, sales. In comparison to pre-Covid times, more than half (51 percent) of operators report an increase. Again, 14 percent of operators are experiencing no change. But 35 percent of operators are experiencing a decrease in sales.

Finally, profit margins. Half of operators may be seeing increases in traffic in sales, but profit margins are taking a hit. On average, the industry’s profit margin is now hovering at 13 percent. That’s an eight-percent drop in comparison to pre-Covid levels.

Segment Performance

The findings regarding profit margins are likely to be the most alarming to operators. Historically, our industry has operated on razor-thin margins for decades. Dropping from an average of 21 percent to 13 is concerning.

However, context is important. The segments seeing the lowest profit margins in 2022 are: Business & Industry (B&I), Healthcare, and Colleges & Universities (C&U). Again, remote work (and learning) are largely responsible for those particular segments watching their profit margins tumble.

The strongest performers are: Quick-Service Restaurants (QSR) at 17 percent; Fast Casual at 15 percent); and Midscale, Casual Dining, and Fine Dining, each at 13 percent. Lodging is just below the current average at 12 percent.

Operator Adaptation

Inflation, rising food costs, supply chain issues, labor shortages… Operators are finding ways to cope, and in some situation, thrive.

Unsurprisingly, the vast majority of operators are increasing menu prices. In the past 12 months, 77 percent of operators have raised menu prices at least once.

These increases range from one percent a staggering 30 percent. However, the majority have kept these increases to one to ten percent. Most (31 percent) have implemented increases of no more than five percent. Just one percent of operators boosted prices between 25 to 30 percent.

Of course, raising prices isn’t the only strategy operators have at their disposal. Forty percent of operators are streamlining their menu, reducing the sizes of their menus. However, it’s wise for operators to review their menus at least every three months to eliminate poor performers.

Other strategies include focusing on value for guests (27 percent); utilizing LTOs and launching new menu items (26 percent); eliminating a specific daypart or portion of the menu (25 percent); and making portion sizes small, or “shrinkflation” (18 percent).

There’s much more revealed in Datassential’s latest FoodBytes report. Download your copy today.

Image: Luca Bravo on Unsplash

United States Capitol Building and Capitol Grounds
by David Klemt David Klemt No Comments

Members of Congress Send Letter to SBA

Members of Congress Send Letter to SBA Regarding $180 Million

by David Klemt

United States Capitol Building and Capitol Grounds

More than 70 members of Congress are urging the Small Business Administration to act quickly to fund eligible RRF applicants.

This news comes on the heels of the findings of the Government Accountability Office’s investigation into the RRF. As you may recall, the GAO discovered $180 million in unobligated funds.

In response, 73 representatives and senators sent the SBA a letter. Sen. Catherine Cortez Masto (D-NV) and Rep. Earl Blumenauer (D-OR) are leading the effort to quickly and fairly distribute the $180 million.

At the start, members of Congress ask that the SBA take immediately action. Also, that the SBA give priority consideration to RRF applicants who didn’t receive funds even though they were awarded grants.

By the way, that’s about 7,000 applicants.

Unfortunately, the recently passed Inflation Reduction Act of 2022 doesn’t include funds to replenish the RRF. And while $180 million is nowhere near the $42-43 billion our industry needs and deserves, it’s something. In fact, it’s a reason to keep pushing Congress to do the right and responsible thing.

Interestingly, the letter sent to the SBA also urges the clawing back of funds for various reasons. One social media user, in response to the letter, suggested auditing the recipients. Presumably, this would also lead to a clawback and, in turn, the further awarding of grants.

Key Segments of the Letter

“Last month, the Government Accountability Office (GAO) released a report titled Restaurant Revitalization Fund: Opportunities Exist to Improve Oversight that stated that as of as of June 2022, $180 million of RRF funding was unobligated. As you know, about 177,000 restaurants that applied to the program did not receive awards. While we understand the remainder of the funding will not reach every business that applied, it is imperative that the SBA distribute every dollar to help as many struggling restaurants as is feasible.

“In addition to these actions, we are also urging that SBA take action to recover funds that have been awarded to ineligible applicants, were found to be accepted fraudulently, or could otherwise be returned. For example, the aforementioned GAO report states that SBA does not require recipients to report their operating status, despite the statute requiring that businesses that permanently close to return the unused funds to SBA. SBA has itself identified potentially ineligible recipients, such as clubs and hotels that failed to meet statutory eligibility criteria. Money recovered from fraudulent and ineligible businesses can subsequently be used to help
fund the many businesses who were unable to receive grants. We urge you to take action on this matter and provide us with detailed information on the amount of funding that may be recovered as well as SBA’s progress in doing so.”

Image: Francine Sreca from Pixabay

Neon beer mug sign
by David Klemt David Klemt No Comments

5 Self-serve Beverage Brands to Know

5 Self-serve Beverage Brands to Know

by David Klemt

Neon beer mug sign

If you’re an operator who wants to leverage the popularity of self-serve beverages, these are the brands you should consider.

There are several reasons to invest in self-serve beverage solutions:

  • Reducing costs
  • Reduction in waste
  • Guest convenience
  • Guest experience
  • System customization
  • Real-time system management and reports
  • Security

Truthfully, had I been told ten years ago that guests would want to serve themselves beer, wine, and other drinks, I would have raised an eyebrow. It’s possible, sure, but I would’ve been skeptical.

Well, it turns out that I would’ve been wrong. Indeed, today’s guest seems to enjoy pouring their own drinks from self-serve systems.

From convenience to control over their experience, these platforms are proving popular with consumers. An appealing factor appears to be the ability to sample a range of beverages to discover new favorites. And, of course, they can do so without having to purchase full drinks or asking a bartender or server for a sample.

So, below are some of the brands in the self-serve beverage world that operators need to know and consider.

Operator Benefits

In terms of P&L, your bottom line will thank you for embracing self-serve solutions.

First, the popularity of these systems increases sales. Guests can sample an array of drinks easily, choose a favorite or two, and serve themselves at their convenience. Additionally, guests tend to view self-serve systems in a positive light due to perceived value.

Second, an impressive self-serve beverage wall can be a sight to behold. There are venues with 100 self-serve taps and screens, which is an impressive sight. There are also all manner of designs not dependent on a wall. One great example is the rotating self-serve beer system at the Famous Foods Center Bar inside Resort World Las Vegas.

In other words, self-serve beverage systems help concepts stand out among competitors.

Third, self-serve systems allow operators to streamline operations and reduce costs. For example, labor costs can be reduced, as can waste.

And fourth, these solutions can lead to improvements in the guest experience. Not having to wait in line and being able to engage more with front-of-house staff aids in guest perception.

iPourIt

According to the brand itself, iPourIt installed the world’s very first beer wall. Since then, the platform has worked tirelessly to improve their solutions.

One way they’ve improved involves the security and usability of their system. As you’ll see with most self-serve brands that pour alcohol, guests are locked out of these systems without RFID access.

IPourIt offers several types of RFID solutions, from bracelets to fobs. Of course, other systems use similar tech. However, iPourIt prides themselves in offering touch-free RFID access and eschewing the need to leave cards in slots when pouring.

Another benefit is that as long as the beverage isn’t meant to be poured hot or doesn’t have pulp/sediment, iPourIt can handle it.

PourMyBeer

This company is iPourIt’s main rival. When you review how they can improve an operators’s bottom line, it’s not hard to see why.

PourMyBeer claims some impressive stats:

  • 45 percent sales increase
  • 50 percent increase in profits
  • 20 percent reduction to labor costs
  • Less than three percent waste

Like other systems, PourMyBeer can help operators leverage wall space. In addition, a single PourMyBeer screen can control four taps, so a wall doesn’t haven’t to be overloaded with screens.

Impressively, this platform also boasts the most POS integrations among the self-serve systems. Obviously, this is beneficial to the vast array of operators.

Table Tap

For operators looking for both a pioneer in the self-serve space, Table Tap may be the perfect partner. In particular, the use of “underage cards” by underage guests to access non-alcohol drinks is a nice feature. So, children up to early college-age students can get in on the fun.

Standing out from other platforms, Table Tap offers wall systems and table-mounted systems. Truly, offering a self-serve wall and a number of tables with the same tech is impressive.

In fact, if I were to install both solutions I would consider the tables a self-service take on VIP seating. And, I’d charge accordingly. Just something operators may want to consider.

Another cool feature relates to Table Tap’s software. While not the most mind-blowing functionality, guests can control an operator’s sound system via the TableTab ordering platform. Better yet, if an operator charges fees to select songs on their jukebox, TabelTab adds them to guest tabs.

To learn more about Table Tap, give episode 22 of Bar Hacks a listen.

Drink Command

“We do everything self pour, and more,” proclaims the Drink Command website.

Is an operator looking for a killer self-pour wall? Done. Table-mounted taps? Check. What about a self-serve tower, self-serve mobile kegerator, or a heavy-duty, mobile, self-serve counter? Drink Command has all three.

In other words, Drink Command makes it easy for operators to get creative and implement a range of self-pour solutions. Additionally, with mobile solutions, operators who want to expand into catering, pop-ups, and special events can do so easily.

For a list of other benefits—including foam-free beer pours, advertising interstitials, and consumption limits—click here.

Napa Technology

Makers of the TapStation, Napa Technology promises a boost to the guest experience. In part, this is because guests don’t have to wait in long lines at the bar.

Additionally, as stated prior, today’s guest enjoys using self-serve beverage systems.

Unlike other platforms, the Napa Technology TapStation doesn’t rely on wall installations. Instead, TapStation dispensers are available in two- and four-keg systems. These stations can be placed anywhere on the floor rather than a wall.

The TapStation can serve beer, wine, kombucha, and cold-brew coffee, ensuring it’s as versatile as the systems above.

Image: Brad on Unsplash

The Florida Theater in Jacksonville, Florida
by David Klemt David Klemt No Comments

Top 10 States Attracting High Earners

Top 10 States Attracting High Earners

by David Klemt

The Florida Theater in Jacksonville, Florida

Using the inflow and outflow data of tax filers earning $200,000 or more, SmartAsset identifies the top ten states attracting high earners.

When it comes to the number-one state, “it’s not even close,” says SmartAsset Advisors. Not surprisingly, several top inflow cities (according to Redfin data) line up with SmartAsset’s top inflow state list.

So, why should this information matter to operators? Plainly, it’s important market information. Population, household income, and age information are crucial considerations when opening any business.

In fact, KRG Hospitality includes such data (and much, much more) when conducting research for our proprietary feasibility, business, and concept plans. Among many elements of opening a restaurant, bar, hotel, or entertainment venue, the income of one’s target audience is crucial.

Knowing where high-income households are leaving and moving to can inform many operator decisions. Where should one open their first concept? Which markets should one consider for expansion? What type of concept will work in a market? What are the threshold price points for menu items? How will this information help inform design choices?

Operators need to recoup their outlay. The income of a concept’s ideal guest should be as important to an operator as knowing their costs.

Top Ten Inflow States

Interestingly, the top state on this list did experience significant outflow in 2020. In fact, the state lost 11,756 high-earning households in 2020.

However, the state also added 32,019 such households, netting 20,263 high earners.

  1. Utah
  2. Idaho
  3. Nevada
  4. Colorado
  5. Tennessee
  6. South Carolina
  7. North Carolina
  8. Arizona
  9. Texas
  10. Florida

Another compelling detail of the states on this list pertains to income tax. In short, three of the states don’t levy personal income tax.

Above, they’re the states in bold: Florida, Nevada, and Texas.

Top 10 Outflow States

So, above are the ten states are seeing the greatest an inflow of high-earning households. Which means, of course, there’s an inverse.

Below, the ten states experiencing the greatest outflow of high earners. Unsurprisingly, SmartAsset deems several entries on the list high-tax states. Also, Washington, DC, is a high-tax area.

Moreover, the list below includes five of the top ten high personal income tax jurisdictions (in bold).

  1. Ohio
  2. Minnesota
  3. Washington, DC
  4. Maryland
  5. New Jersey
  6. Virigina
  7. Massachusetts
  8. Illinois
  9. California
  10. New York

However, it’s not as though these states are seeing a massive exodus of high-earning households. In fact, per SmartAsset, these states have more high-income households than the national average.

Nationally, high-earning households account for less than seven percent of all tax filers. According to SmartAsset, nearly nine percent of tax filers are high-income households in the top ten outflow states.

Image: Trevor Neely on Unsplash

Fanned out hundred dollar bills
by David Klemt David Klemt No Comments

So, What’s Up with that $180 Million?

So, What’s Up with that $180 Million?

by David Klemt

Fanned out hundred dollar bills

It’s not much in comparison to the $40 billion we need to replenish the Restaurant Revitalization Fund but $180 million is still significant.

According to a June 14 report, the Small Business Administration is sitting on $180 million in RRF funds. This information came to light due to a Government Accountability Office (GAO) investigation.

Unfortunately but unsurprisingly, the funds likely won’t reach operators for a while. Why is that? Well, the SBA is working with the Justice Department to “formulate a plan on how to distribute” the money.

As we know, bureaucracy tends to move at a glacial pace. Additionally, $180 million is nowhere close to the roughly $42 billion it would take to fund RRF applicants who have not received grants.

Where did this Money come From?

We know that $24 million is from funds set aside by the SBA for litigation. However, according to the National Restaurant Association, the American Rescue Plan Act of 2021 didn’t expressly include such a set aside.

Interestingly, the NRA is calling for the SBA to disperse the litigation set aside to RRF applicants. This is due to their interpretation of “the spirit of the law” and unobligated funds.

Now, on to the biggest chunk of the tens of millions of dollars in unawarded, unobligated RRF money. Where, exactly, are these funds from?

Well, it’s a little murky at the moment. Per the GAO, awards returned by either recipients or their financial instutions amount to $56 million. The rest, according to the GAO, comes from “realized or anticipated recoveries,” per their report.

However, some sources report that $156 million was clawed back by the SBA and that the $24 million set aside make up the $180 million.

So, Who gets the Money?

In short, we don’t know yet. In fact, we don’t even know if RRF applicants will have to apply again for a piece of the $180 million.

Additionally, we don’t know if applicants who received an approval for an RRF grant but didn’t receive the award will be processed first.

What we do know is that if every dollar of this “leftover” $180 million is distributed to RRF applicants, a mere 0.44 percent would receive a grant.

As Nation’s Restaurant News reports, 150,166 RRF applicants were in fact approved for a grant but never received one. It would take over $41 billion to fund all 150,000-plus applicants.

When the Justice Department and SBA finalize a plan, we’ll let you know.

Image: John Guccione on Pexels

United States Capitol Building through trees
by David Klemt David Klemt No Comments

Congress Fails Us Once More

Congress Fails Us Once More

by David Klemt

United States Capitol Building through trees

A “compromise” and “far from perfect,” the Inflation Reduction Act of 2022 is yet another bill that could include the RRF but fails to do so.

Not content to deliver just the gut punches our industry has already endured, Congress is leaving us out. Again.

A bill that targets inflation in the US should, logically, include replenishment of the Restaurant Revitalization Fund. However, RRF replenishing isn’t among Inflation Reduction Act compromises.

By the way, that isn’t my assessment. It’s President Joe Biden’s summary of the bill’s passage in the Senate: “This bill is far from perfect. It’s a compromise.”

To clarify, this compromise is a $430 billion spending bill that doesn’t include $40 billion to replenish the RRF. That’s interesting, considering Democrats claim the bill will not only generate enough revenue to pay for itself, they say it will generate another $300 billion throughout the next decade.

Restaurants in the US are projected to generate nearly $900 billion in sales this year. Apparently, however, that’s not enough for our politicians and lawmakers to consider us important to the economy.

Instead, those who enjoy near-inscrutable power and are in the position to stop another bout of restaurant and bar closures have chosen not to help. Our industry, which employs millions upon millions of hard-working Americans is once again on the outside looking in.

The Road to Nowhere

In a word, the road to RRF replenishment is exhausting. One Instagram user commented as such on the Independent Restaurant Coalition‘s post about us being left out of a massive spending bill yet again.

Three months ago, the US Senate killed RRF replenishment when they voted against even debating the Small Business COVID Relief Act of 2022.

Midway through June I reported that Sean Kennedy, executive vice president of public affairs for the National Restaurant Association, posited that the RRF could be replenished via a reconciliation bill.

Addressing the possibility, Kennedy made clear it was a longshot. He was correct.

Indeed, the Inflation Reduction Act was passed by the US Senate via reconciliation bill. A simple majority consisting of all 50 Democrat senators and Vice President Kamala Harris sends the bill to the House.

Compellingly, the nonpartisan Congressional Budget Office’s analysis of the Inflation Reduction Act indicates the bill’s name is a misnomer. According to the CBO, the bill will either have zero or nearly-zero impact on inflation this year or in 2023. A group of 230 economists warn the bill may increase inflation.

The bill is expected to pass the House in its current form and be signed by President Biden by the end of this week.

Response from the IRC

Immediately after news broke that the Inflation Reduction Act of 2022 passed the Senate but failed to include RRF replenishment, the IRC’s Erika Palomar responded.

The executive director of the IRC said:

“For nearly three years, independently owned restaurants and bars have weathered multiple COVID-19 surges, government-mandated closures, consumer hesitancy, rising prices and ongoing restrictions, while fighting to keep their doors open and staff employed. Restaurants and bars are the heartbeat of every community, and we are incredibly disappointed to not be included in the reconciliation vote this weekend. 177,300 small businesses have been patiently waiting for relief and their needs are being ignored, again.

“Thousands of restaurants and bars are at risk of closing permanently as a result of continued Congressional inaction on the replenishment of the Restaurant Revitalization Fund (RRF). The failure of Congress and the White House to act swiftly is impacting neighborhoods in every state across the country. Congress has failed these businesses, but the Independent Restaurant Coalition is not giving up the fight in any way possible to support independent restaurants.”

Further Disappointment

Over the past 15 months (longer if we really look back), our politicians and lawmakers have been consistent about one thing. They have continually failed to recognize restaurants and bars for what they are: cornerstones of their communities.

Of course, they’ll happily use our businesses for political theater and their fundraisers. But giving us more than lipservice? Not on the agenda.

Image: Paula Nardini on Pexels

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