As restaurants continue to search for ways to find success amid inflation and labour shortages, many are exploring new revenue streams to boost their bottom lines and avoid raising menu prices. In fact, only 23 per cent of restaurants plan to increase their prices, even though 85 per cent of Canadian customers say they would understand a modest price hike.
88 per cent of restaurants are expected to add additional revenue streams in 2023 as they look for viable ways to recoup their ever-increasing costs and continue to serve their customers.
Getting into retail
Since the pandemic, restaurants have learned to do more with less, trying to capture consumer attention with offerings like cooking classes to connect with customers and try something new. Selling retail items also presents a viable revenue stream, with 54 per cent of consumers making retail purchases at restaurants last year. From signature sauces to branded t-shirts, restaurants are venturing into the retail space to make the most of their margins.
Working on loyalty
Loyalty programs are on the rise, too, as restaurants try to strengthen relationships and stand out from their competition. Taking it one step further, some restaurants are evolving from a loyalty program to a subscription model, involving monthly fees, regular perks, and higher discounts for members. This is providing them with a regular clientele and a regular, predictable monthly income their restaurant can rely on.
RELATED: How loyalty can help offset the effects of inflation
Recent surveys show that 47 per cent of restaurant loyalty members use their membership several times a month. If your restaurant has been weighing the advantages of a loyalty program, this may be the time to launch a program to grow your brand and increase repeat business.
Catering to corporate
Off-premise dining continues to dominate with diners, with about 60 per cent of consumer ordering takeout or delivery each week. Restaurants are adding to their repertoires with meal kits and prepared foods to help address the demand and broaden their income streams.
If you have the means to prepare meals to go, consider adding events to your regular takeout like Cinco de Mayo, Mother’s Day, and more, to help your guests enjoy your menu at home.
Catering and parties are also gaining traction. As more and more people head into work, companies will be looking to host corporate events, lunches, and meetings, which can help restaurants make up revenues if they get it right. Studies show that 93 per cent of employees show up at the office when there is free food, so companies may even be using catering as a way to draw employees back into their workplaces. Developing and marketing a lunch menu for local companies may be a way to increase your restaurant sales during the day and make a name for yourself within the corporate community.
As inflation and labour shortages continue, restaurants may need to pivot again, adding additional revenue streams to stay afloat and get ahead. Find out what your customers are looking for, decide what works best for your business, and get creative in building your profit and staying ahead of your competition.
