Restaurants had a rough pandemic, but customers were understanding. The industry’s struggle brought out the best in many Chicagoans. Loyal patrons went out of their way to ensure favorite venues survived, and in some cases showered workers with extra tips and gratitude.
Today, the pandemic emergency is officially over. But for many full-service local eateries, the battle for survival is emphatically not over. A period of labor shortages, iffy finances and desperate experimentation lives on.
At the same time, many customers have put the pandemic behind them and grown frustrated with aggressive tip-seeking, QR-code menus, sneaky added charges and other legacies of the crisis.
The reality is that independent neighborhood restaurants need their communities to support them as much as ever. As veteran food-service consultant David Henkes of Chicago’s Technomic put it: “It is harder to run a restaurant today than in the last 25 years.”
Running a restaurant has never been easy, with one of the highest first-year failure rates of any small-business category. The pandemic led to a shakeout, especially among independents that lost ground to chains, which now comprise roughly half of all U.S. restaurants.
While business conditions have improved and revenues are rising, profits continue to be elusive at the full-service, independent outlets that do so much to bring people together and differentiate Main Streets and neighborhoods across the country.
The result will be even more changes at your local eatery. Customers are being asked to accept everything from robot chefs to apps that automate many tasks previously undertaken by servers, all with the goal of reducing sky-high labor costs — the No. 1 impediment to the industry’s nascent comeback.
The recent National Restaurant Association Show at McCormick Place heralded a wave of technology in an industry that traditionally has low technical barriers to entry. At the sprawling trade show, robots operated frying stations and stirred woks while a virtual bartender took drink orders, replete with a sassy attitude.
Takaaki Uesugi of Sojitz Corp. of America sampled out sushi using pre-sliced, previously frozen fish on beds of rice cranked out by a machine. Sushi chefs, he explained, are expensive, and his system promises to save labor costs with the pitch, “No sushi chef? No problem.”
Vendors demonstrated dozens of similar machines for reducing unpleasant, repetitive tasks that make restaurant work famously tough and that drive away employees. Similarly, the trade show featured a rash of new, precooked products that need only to be dished out, cutting prep time and reducing demands on skilled kitchen workers.
Between the use of automation to reduce labor costs, and the boom in takeout and delivery brought about by social distancing, even mom-and-pop outlets have become dependent on cutting-edge technology, with mixed results.
Point-of-sale platforms like Lightspeed promise to integrate everything from billing and seating customers to managing inventory, replacing disparate systems that don’t communicate with each other. Apps like CityCheers aim to keep bars and restaurants connected to their best customers through personalized marketing and mobile payments. Among the potential benefits: freeing servers to interact with guests.
The reality, though, is that restaurants can only do so much: Embrace tech, boost takeout and delivery, add lower-cost menu options, reduce portions of high-cost items, provide vegan or plant-based dishes for customers who insist on those and — oh, yes — raise prices.
Inflation has come to restaurants with a vengeance, as labor and food costs both have soared.
Customers well aware of their diminished spending power are pushing back on higher prices, even at fast-food chains whose cost advantage over full-service restaurants has grown, not least because of their ability to make better deals with delivery services like DoorDash and Uber Eats. McDonald’s Corp. CEO Christopher Kempczinski told CNBC just last month that customers have responded to higher menu prices by ordering fewer extra items, resisting the “fries with that?” sales pitch.
Message to the restaurant industry: Sympathy is giving way to frustration and customers are feeling gouged.
After all, the derivation of the word “restaurant” comes from the French verb restaurer, translatable as “to restore oneself.” Bars and restaurants are supposed to offer balm and recovery after a long day’s toil. And most of us care far more about how we are treated, not in the places where everybody knows our name but in the establishments where no one does.
Our advice is to phase out the digital menus that need to be pinched or expanded on smartphones, the igloos and yurts for outdoor dining during Chicago’s frigid winters, the deceptive service charges sneaked into bills that wind up going to restaurant owners rather than workers. And, please, stop shoving devices in our faces that start the tip options at 20% and go up from there.
Above all, customers hate the rise of what economists call “price partitioning,” where the true price of a meal is hidden by breaking it into little pieces. That cursed notion is behind paying for bread that used to be free and the 3% surcharge several restaurant chains in Chicago are now adding to checks without giving that money to their tipped staff. This stressful, anti-consumer practice should cease. Menu prices should be honest. And it’s not enough to say customers can request the surcharge’s removal: Restaurants are taking advantage of our reluctance to look cheap in front of family or friends.
Post-pandemic, inflation-strapped consumers are realigning which businesses they support, and as difficult conditions continue to pressure restaurants, the industry needs to remember to put its loyal customers first.
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