Restaurant operators are generating more revenue, they’re more optimistic and they’re planning to expand, according to the 2017 American Express Restaurant Trade Survey.
More than half of restaurant operators and managers, 54 percent, said their revenue is up over where it was a year ago. And 72 percent said they expect revenue to increase over the next year.
And 83 percent of operators said they plan to hire, while roughly a third of operators said they plan to seek financing over the next 12 months to expand or add technology.
Nearly two-thirds of operators plan to spend on technology investments over the next 12 months, and will spend $4,200 on average.
The survey suggests that the broader restaurant industry is in strong shape and filled with optimistic owners — despite concerns about sales trends.
“It’s a good time to be in this business,” said Rhonda Abrams, a small business advocate who discussed the survey results while giving advice to independent operators on how to compete with chain restaurants, during an American Express presentation last month at the NRA show in Chicago. “You are well poised for growth.”
American Express surveyed 488 owners, managers, directors and CEOs of independently owned restaurants in late April. The company also surveyed more than 1,000 consumers to get an idea of what makes them tick.
So the survey covers a wide range of issues, both for customers and the restaurants themselves. Here are some notable results:
Delivery is a big deal to Millennials: According to the survey, 68 percent of Millennials ordered delivery over the past month. By comparison, only 36 percent of Baby Boomers ordered delivery.
“People want to eat at home or in the office or in a park,” Abrams said. “Millennials like their food to go.”
To be sure, more than half of consumers prefer dining out, while only 29 percent prefer takeout and only 12 percent prefer delivery from a delivery service. And Abrams noted that many Millennials like delivery because they have families and don’t have the time to prepare the food.
Consumers are increasingly ordering takeout. And Millennials are far more likely to order that takeout using a mobile app or a website. According to the survey, 62 percent of Millennials used a mobile app or website over the past month. By comparison, just 28 percent of Baby Boomers did.
And 58 percent recently used an ordering and delivery service like Grubhub, compared to 35 percent of Generation Xers and 21 percent of Baby Boomers.
People still like humans. The vast majority of consumers, 75 percent, prefer restaurants with in-person service versus digital platforms.
But again, Millennials are OK with the tech: 39 percent prefer digital customer service, while 28 percent of Gen X and 12 percent of Baby Boomers prefer digital.
Only 7 percent of restaurant operators say they use automated customer service technology. More are considering it: 26 percent said they plan to or are considering adopting such technology — though 40 percent of restaurants said they would not adopt that technology.
And among operators considering automated technology, 31 percent expect higher profits.
Go local. Consumers like local ingredients. More than half, 56 percent, said it’s important for restaurants to use locally sourced ingredients.
By comparison, 44 percent of restaurants currently used locally sourced ingredients, but another 39 percent are planning to do so.
“While you may not be embracing it yet,” Abrams said, “your customers sure are.”
“Millennials are the largest customer base. And they like to shop local.” She noted that 40 percent of Millennials like to shop local even if it costs more.
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