With restaurant earnings rather a mixed bag so far this season, and external factors like commodity prices affecting profit margins, it’s timely to take a look at what your area’s eateries (and the vendors and workers who depend on them) can expect in the fourth quarter of 2012 and beyond.
As TheStreet.com reports, some publicly traded restaurant chains bucked tradition by performing relatively well during the recession, but recent results for names like McDonald’s and Chipotle have been tepid. Still, consumer spending on “food away from home” accounts for nearly half the average household’s budget, according to the USDA’s Economic Research Service, up from 29 percent in 1984.
This just-out industry report from the Baum+Whiteman consulting firm is full of story nuggets, as it outlines the “17 hottest trends” in the food service industry for 2013. Specialty beverages, high-end fast food and sophisticated snacks will the new chic consumables, the report says, while automation like kiosks and food-dispensing machines (a cupcake ATM?) will appeal to consumers round the clock. In fact, the report says, a potato chip machine in Argentina emits warm, freshly-made Lay’s products while a butcher in Spain offers a 24-hour vending machine for cuts of meat and sausage.
Speaking of machinery, consider the effect of restaurant trends on ancillary businesses, too, from real estate developers to various suppliers; the market research firm IBISWorld says the restaurant supply industry is $19 billion in the U.S. and that sales of equipment such as energy-efficient ovens, and other capital goods are expected to grow as consumer sentiment improves.
Restaurant employment is another facet of the business. A somewhat political angle: Reports say Darden Restaurants (parent of Red Lobster and other familiar chains) may be inclined to keep all workers at part-time status should the Nov. 6 election favor the continuation of the Affordable Care Act, in an effort to dodge the requirement to provide health insurance to employees. I was under the impression that most restaurant staffers worked less than a 40-hour week already, for a variety of reasons. With food service jobs among the fastest growing (according to an industry journal, QSR), you might want to explore a primer on wages, benefits, working conditions and other issues. The Foodservice Equipment & Supplies online magazine is a trove of ideas and links to industry conference sites.
The federal Bureau of Labor Statistics says Food and Beverage Serving and Related Workers number more than 4 million in the United States, with median pay of $8.72 per hour. Growth this decade is expected at 12 percent, or about average for most occupations.
And here’s a neat interactive map from the Department of Labor showing minimum wage nationwide for tipped employees, which is defined federally as those who earn more than $30 per month in tips. An explainer on how your state’s rules stack up to others might be enlightening for readers. Connecticut, for example, allows employers to drop minimum wage from $8.25 per hour to $5.69 per hour (31 percent) for workers who earn $10 per week in tips, or $2 a day in some industries. Don’t forget to include a sidebar or info box on IRS rules about reporting tip income, as well.