Prepare Your Restaurant for a Possible Recession

Recession or not, you can be ready.

OVERVIEW

Prepare Your Restaurant for a Possible Recession

TABLE OF CONTENTS

Trend 1: Making Menu Adjustments
Trend 2: Streamlining Operations
Trend 3: Growing Brand Loyalty

RECESSION OR NOT, YOU CAN BE READY

Average monthly inflation-adjusted restaurant sales were $1 billion lower in the third quarter (July–September) than they were during the second quarter (April–June) of 2022, according to the National Restaurant Association. Call it inflation or a recession, the term used doesn’t matter much when consumers have already begun lowering their spending and adjusting their dining out occasions. In fact, when surveyed, 90% of consumers believe that a recession is eminent, or already here.

Restaurant operators can stay ahead of receding sales by adjusting menus, streamlining operations, and continuing to grow brand loyalty.

While menu prices continue to rise in most restaurants, overall sales are decreasing. This shift has prompted some restaurants to offer limited-time-only discounts to woo customers back to full-service and fast-casual dining and away from fast food. The Yelp Economic Average from Q3 2022 revealed that food businesses, followed by restaurants, are seeing the largest increases of inflationary experiences when compared to Q3 2021, leading to consumer searches for budget-friendly dining and grocery options to be higher in Q3 2022 than they were in Q3 2021.

If restaurant operators want to stay ahead of receding sales, it’s imperative that measures are taken now to adjust menus, streamline operations, and continue to grow brand loyalty. Beyond these measures, consider making operational and financial plans that address a variety of possible business scenarios so that you’re ready for anything.

Read on for more operational inspiration.

OPERATOR OUTLOOK: In a June 2022 survey of restaurant operators, only 18% of operators said they expect economic conditions to improve in six months, while 43% of operators said they think conditions will worsen in six months.

_{^{Sources: National Restaurant Association, Inflation-Adjusted Restaurant Sales Declined in September (Oct. 2022); Datassential, Prepping for Recession (2022); Restaurant Business, As Inflation Rises, Some Restaurants Are Lowering Prices (July 2022); Q3 Yelp Economic Average (Oct. 2022); National Restaurant Association June 2022 Tracking Survey.}}