By Dale J. Venturini
President/CEO, Rhode Island Hospitality Association
“Catch a man a fish, and you can sell it to him. Teach a man to fish, and you ruin a wonderful business opportunity.” – Karl Marx (1818-1883) German philosopher and political economist.
Opportunity is the name of the game for the restaurant and hospitality industry this year, according to the National Restaurant Association’s (NRA) Industry Forecast for 2010. With the country’s economic woes and collapse of the financial market seemingly in the past, Americans have a pent-up need to spend money.
As steady or decreasing employment figures show slight glimmers of hope, the retail industry’s numbers show increases, and the federal stimulus programs continue to put dollars back in American’s pockets, we all feel a stronger sense of consumer confidence. With consumer confidence, comes the return of discretionary spending.
The restaurant industry is at the ready to welcome consumers with open arms. From prix fixe menus, to specially-priced family dinners, to quick-service meal options, to cut-rate gift cards, the industry has been doing what it takes to keep people coming through its doors during the economic downturn.
It’s been a long haul, but all of the hard work will pay off this year according to the NRA’s Forecast. In fact, the organization projects the industry to hit $580 billion this year, a rise of 2.5% from 2009. This equals more than $1.5 trillion in overall economic impact and represents 4% of the U.S. gross domestic product.
Once again, the industry will remain one of the largest employers in the nation, giving jobs to approximately 12.7 million workers. The amazing thing about these numbers is that we’re not talking about huge corporations here...the majority of our industry is comprised of small businesses. In fact, of the 945,000 restaurant locations throughout the United States, the majority employ 50 workers or less.
The NRA Forecast also identifies numerous opportunities for restaurants to build their business this year. Consumer preferences remain largely unchanged from last year with a focus on speed-of-service at QSRs; elegance in fine dining; and the ability to conveniently try the next ‘best thing’ at their local coffee shop or restaurant.
Restaurants are so much a part of our lives that according to the survey, nearly four in five consumers believe that going to a restaurant with family or friends gives them opportunities to socialize and is a better way to use their leisure time, and nine out of 10 adults report going to restaurants on a regular basis.
With this built-in market, it would seem that the industry will have smooth sailing this year. That’s not quite true...operators need to still be mindful of their costs and of providing consumers with what they are looking for. Most experts agree that while the economy has turned a corner in 2010, we still won’t see the levels of consumer confidence and spending that were prevalent prior to the economic downturn in 2008, until the last part of 2010 or early 2011.
In the interim, however, marketing to consumers with an eye to what they’re looking for will help an operator’s bottom line. 65% of adults say their favorite restaurant foods provide flavor and taste sensations that they can’t readily duplicate at home. 40% of consumers say that buying restaurant, take out or delivery meals make them more productive on a daily basis and 29% of consumers report that take-out food is absolutely essential to the way they live.
Other trends include continued marketing of healthful menu items, an eye to ‘green’ products and offerings, delivery and other off-premise options, cooking and other interactive classes and a focus on new media to reach new and returning guests. In fact, social media and networking sites like Twitter and Facebook will continue to play a large role in the way consumers receive information. Good old fashioned ‘word of mouth’ which is probably the best form of PR out there, has moved to the social space. If you don’t have a social media plan – you might want to think about creating one for your property this year.
Our industry is definitely a powerhouse and will remain an essential part of the nation’s economy this year. Keeping an eye on costs, finding new ways to reach consumers and giving customers what they want are all critical to growing the bottom line.
As steady or decreasing employment figures show slight glimmers of hope, the retail industry’s numbers show increases, and the federal stimulus programs continue to put dollars back in American’s pockets, we all feel a stronger sense of consumer confidence. With consumer confidence, comes the return of discretionary spending.
The restaurant industry is at the ready to welcome consumers with open arms. From prix fixe menus, to specially-priced family dinners, to quick-service meal options, to cut-rate gift cards, the industry has been doing what it takes to keep people coming through its doors during the economic downturn.
It’s been a long haul, but all of the hard work will pay off this year according to the NRA’s Forecast. In fact, the organization projects the industry to hit $580 billion this year, a rise of 2.5% from 2009. This equals more than $1.5 trillion in overall economic impact and represents 4% of the U.S. gross domestic product.
Once again, the industry will remain one of the largest employers in the nation, giving jobs to approximately 12.7 million workers. The amazing thing about these numbers is that we’re not talking about huge corporations here...the majority of our industry is comprised of small businesses. In fact, of the 945,000 restaurant locations throughout the United States, the majority employ 50 workers or less.
The NRA Forecast also identifies numerous opportunities for restaurants to build their business this year. Consumer preferences remain largely unchanged from last year with a focus on speed-of-service at QSRs; elegance in fine dining; and the ability to conveniently try the next ‘best thing’ at their local coffee shop or restaurant.
Restaurants are so much a part of our lives that according to the survey, nearly four in five consumers believe that going to a restaurant with family or friends gives them opportunities to socialize and is a better way to use their leisure time, and nine out of 10 adults report going to restaurants on a regular basis.
With this built-in market, it would seem that the industry will have smooth sailing this year. That’s not quite true...operators need to still be mindful of their costs and of providing consumers with what they are looking for. Most experts agree that while the economy has turned a corner in 2010, we still won’t see the levels of consumer confidence and spending that were prevalent prior to the economic downturn in 2008, until the last part of 2010 or early 2011.
In the interim, however, marketing to consumers with an eye to what they’re looking for will help an operator’s bottom line. 65% of adults say their favorite restaurant foods provide flavor and taste sensations that they can’t readily duplicate at home. 40% of consumers say that buying restaurant, take out or delivery meals make them more productive on a daily basis and 29% of consumers report that take-out food is absolutely essential to the way they live.
Other trends include continued marketing of healthful menu items, an eye to ‘green’ products and offerings, delivery and other off-premise options, cooking and other interactive classes and a focus on new media to reach new and returning guests. In fact, social media and networking sites like Twitter and Facebook will continue to play a large role in the way consumers receive information. Good old fashioned ‘word of mouth’ which is probably the best form of PR out there, has moved to the social space. If you don’t have a social media plan – you might want to think about creating one for your property this year.
Our industry is definitely a powerhouse and will remain an essential part of the nation’s economy this year. Keeping an eye on costs, finding new ways to reach consumers and giving customers what they want are all critical to growing the bottom line.
