There are so many costs and conflicts at play in the restaurant business that even crazy VC money and celeb chefs are struggling to save their part of it.
Editor’s Note: In September we announced that Skift was expanding into food and drink with the addition of the Chefs+Tech weekly newsletter.
We see this as a natural expansion of the Skift umbrella, bringing the big picture view on the future of dining out, being fanatically focused on the guest experience, and at the intersection of marketing and tech.
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Is the American Restaurant Industry Bubble Bursting?
We’ve been quietly covering the data in the past few issues, as it’s eked out that the restaurant industry is headed for quite the financial downturn, but it appears to be less of an end-of-2016 joke than we may have hoped. As Thrillist investigates in quite some detail, it would seem that the death of the RNR (reall nice restaurants) is impending and the advent of the NER (nice enough restaurant) is here to stay, all of this midst the upward turn of the whole fine casual movement and Muncheries of the world. “Rising labor costs, rent increases, a pandemic of similar restaurants, demanding customers unwilling to come to terms with higher prices—it’s the Perfect Restaurant Industry Storm,” writes Kevin Alexander. Yes, we can wholeheartedly say that raising the minimum wage is a good thing but rising tides lifts all grilled octopus entrées as well, so it’s to be expected that somebody’s gotta pay for the higher rent and wages. Just as the Souvlas of the world offer an aspirationally delightful, under $20 experience for a lamb salad, glass of wine and ambiance. Put that in your double broiler and melt it, would ya.
Death to Delivery? Maple Leaks Financial Documents
Okay—sorry, but we have to say it—the truth is finally out about the deeply unstable model behind delivery start ups, such as Maple, who confirmed, on average, to have lost money on every meal they prepared in 2015. Hello, trending down. Scale is a problem; food stabilization over distance is a problem. Maybe only cheap food is meant to be delivered… but we digress. Recode writes of how the on-demand delivery sector notoriously burns cash and that Maple’s business appears not to be an exception, given the added bonus of prepping its own meals (the Manhattan-based concept has its own restaurant kitchen preparing each and every order, not unlike the Sprig model). Delivery is not only a logistics game, but the issues of consistent quality and growing demand are real, so it should be interesting to watch these companies battle it out, with brands like Din shuttering their doors in October of 2016. Between the restaurant industry bubble burst, and the dismal future of delivery, 2017 is off to a rockin’ delicious start.
San Francisco’s Quince Serves Food on iPads
While traditional wisdom holds that food + technological hardware do not mix, leave it to a San Francisco establishment to put it to the test. Quince, Michael Tusk’s Michelin-starred, much lauded white table-cloth establishment in Jackson Square has defied its rustic exterior by offering screen-top dishes within. Yes, that means your consommé may just slip-slide around on a backlit surface of a tablet. The people were appalled (rightly so), one such writing, “This is so unhealthy… do people not remember how much microbes are on touchscreens?” according to the San Francisco Chronicle. We can’t say we’re behind it, though innovation is to be respected and we’d like to learn more about how, why, and do they go in the dishwasher?
Millions of Restaurant Workers are Getting A Raise
Sorry to bring y’all down with the first few bits of this here newsletter, so here’s an uplifting moment for those who serve, clean, prep, serve, clean, and prep all over again. 19 states are increasing the minimum wage, affecting millions of restaurant staff. There are also 22 cities ‘round the county taking the same measures. Trump may not approve, but we certainly do, despite the move’s potential effects on the climate of restaurant business overall (see blurb numero uno.) While these wage hikes are not necessarily no-strings attached and in some instances, like New York, carry specifications dependent upon your exact role and where you are in the state, consider it a New Year’s raise for many-a-burger flipper this month.
- One word: OUCH (though Wells has a point—virtue rarely replaces flavor. It’s January and we are all too familiar.)
- Because bubbles are for year round. Punch up your January.
- While we still have our doubts about the whole food trend prediction thing, The Globalist podcast does a crafty little job of recapping just what happened in 2016: the Year of Poke, Fine French Renaissance, and LA’s Comeuppance. Have a listen.
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Photo credit: An image from the company Maple that, despite being delicious, is falling short of some revenue expectations. Maple / Facebook