Will 2024 bring relief to restaurateurs?

The past few years have seen record-breaking inflation, unrelenting labour shortages, and continuing supply chain disruption, as the foodservice industry strives to recover. With some improvement in these conditions recently, is there relief in sight for restaurateurs in the coming year?

The first step in looking ahead is understanding the major obstacles and pinpointing potential weaknesses in the industry.  According to Brad Lancaster, CEO of Restaurant Supply Store, “Supply chain vulnerability has escalated, with global disruptions impacting the timely procurement of quality goods and equipment. Additionally, we are witnessing a rise in operational costs owing to inflation and supply chain issues, which are squeezing profit margins.”

So far, what we’ve seen in the 2024 predictions is that the year will being even more conscious consumerism, with diners looking to support restaurants that are transparent and in line with their values and goals. Along with that, digitalization and innovation will continue to dominate restaurant operations, with greater adoption from operators.

What’s the current state of the foodservice industry? Recent studies show that one-third of Canadian restaurants are operating at a loss, with only 17 per cent reporting that they are breaking even. “We’ve got operators with a heavy amount of debt. We’ve got operators having to negotiate the same interest rate challenges that Canadians are managing on a day-to-day basis. And we’ve got heavy, heavy inflation that has just smacked the industry,” says Restaurants Canada president, Kelly Higginson.

As a result, restaurants have raised menu pricing, some even cutting the most expensive ingredients from their menu to mitigate the risk of raising prices too high for customers. Consumers are looking for memorable dining at a price they can afford.

A growing demand for enhanced customer experiences will also put pressure on restaurants, driven by evolving customer expectations for novelty and personalization. “Businesses, particularly in the hospitality and retail sectors, will need to think creatively about how they can create immersive, unique, and satisfying experiences for their customers,” says Lancaster.

How can restaurateurs use technology address these upcoming challenges?

Rather than taking a reactive approach, the foodservice needs to see these challenges as opportunities for growth, creating strategies to maximize efficiency, resilience, and growth. Adopting technology to provide solutions like precision cooking, programmable ovens, and self-service platforms, can take over routine tasks, liberating staff for more complex roles and helping to better manage labour.

As well, technology can help with a faster, simpler customer experienced with an all-digital approach, streamlining order taking, menu changes, inventory control, order placement, delivery scheduling, and beyond.  In the kitchen, smart equipment like programmable ovens, digital scales, and wifi-enabled appliances will increase efficiency, improving kitchen operations and boosting the customer experience.

Data is also becoming a critical component for restaurant operations, providing greater insight into customer behaviour, history, and adding a predictive element to the overall guest experience. “By leveraging customer data from digital interactions, restaurants will be able to gain insights into customer preferences, peak times, popular menu items, and more, enabling them to make data-driven decisions,” says Lancaster.

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By understanding and anticipating customer needs and preferences, restaurateurs can develop more engaging, personalized experiences that help to build loyalty and drive repeat business into 2024 and the years to come.