Square’s latest quarterly Restaurant Industry Report offers a comprehensive analysis of the dining landscape in American downtowns post-pandemic. The report, drawing on data from Square’s extensive network of food and beverage sellers, delves into consumer spending patterns, restaurant wages, and the adoption of new business models in the industry.
Thanksgiving Dining: A Shift Towards Convenience
With Thanksgiving around the corner, Square’s data reveals a growing trend of consumers opting for take-out Thanksgiving meals. In response, many restaurants are now offering prix fixe Thanksgiving meals, providing a blend of luxury, choice, and convenience. Square’s Thanksgiving Meal calculator, a new tool, allows consumers to estimate the cost of a take-out meal, averaging $34 per person.
Stabilization in Downtown Dining Traffic
The report indicates a stabilization in dining out in downtown areas, maintaining roughly 72% of pre-pandemic levels as of September 2023. This trend is attributed partly to the continuing work-from-home culture. However, cities like Detroit, Los Angeles, and Miami have seen significant growth in food and beverage transactions, signaling a varied recovery across different metropolitan areas.
Technology’s Role in Adapting to New Trends
Ming-Tai Huh, General Manager of Square for Restaurants, highlights the importance of technology in adapting to these changing dining trends. Solutions like handhelds for line-busting, efficient Kitchen Display Systems (KDS), and automated marketing tools are recommended for restaurants to manage demand fluctuations effectively.
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Marketing and Loyalty Tools to Enhance Customer Engagement
Restaurants are encouraged to utilize tools like Square Marketing and Square Loyalty to attract and retain customers. These tools aid in promoting new items, events, and deals, and enable the creation of loyalty programs that provide insights into customer activity and sales impact.
Wage Trends in the Restaurant Sector
The Square Payroll Index shows that wage growth for restaurant workers, which peaked in March 2022, has started to slow down. Despite this, certain metropolitan areas like Cincinnati, Las Vegas, and Jacksonville are experiencing above-average earnings growth.
Innovation Through Subscriptions
Facing challenges like inflation and economic uncertainty, restaurateurs are diversifying revenue streams through subscriptions, such as monthly wine clubs or quarterly specialty food shipments. Square notes a 54% year-over-year growth in food and drink sellers with active buyer subscriptions.
Square’s report paints a picture of a resilient restaurant industry, adapting to post-pandemic changes and embracing technology and innovation to meet new consumer preferences and challenges.