Reply to Went to Five Guys and guess what I paid (inflation)

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Reply to "Went to Five Guys and guess what I paid (inflation)"

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[quote=Anonymous][quote=Anonymous]Hello! Would love to hear from an actual finance DCUMer. Is there concern the restaurant industry is headed for a collapse?  Did restaurants bounce back from covid by pivoting to all the takeout (after being clobbered when covid started), but now food price inflation plus staffing issues mean another crisis is ahead? I’m genuinely curious. 
- DCUMer without a dog in this fight 
[/quote]

They won't collapse. I think what we'll see is a trend to more fast casual, where you order on a kiosk at the front, take a seat, and they bring it to your table or call your number. Labor should be 1/3 of an overall restaurants' budget (then 1/3 food cost, 1/3 overheads + profit). You can cut your food costs by switching to cheaper ingredients (for example using skirt steak instead of a nicer cut) or reducing portion sizes. You can reduce labor costs by doing kiosk ordering and not having proper waitstaff. I'm surprised Five Guys hasnt' gone to kiosk ordering, but it could be a matter of space costs -- you need to have 2-3x the number of kiosks to match one human, and that takes up space. McDonalds that get renovated are like this now -- almost all kiosks and just one actual order taker.

Look at grocery stores -- 20-30 years ago self check-out was new. Now it's the norm and staffed registers are the rarity. [/quote]

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