Should Restaurants Go Cash-Free?

One of the hottest debates in the restaurant industry is whether or not restaurants should go “cashless.”

Cashless restaurants do not accept cash payments and instead require customers to use credit cards, debit cards, cash cards, or contactless payment systems.

So, should your restaurant go cash-free? We’ve done some research and rounded up the most common arguments for and against going cashless.

Danny Meyer, who has led the charge against going tip-free, has already gone cash-free at four of the restaurants in his Union Square Hospitality group, mega chains Sweetgreen, Dos Toros, and Tender Greens have banned cash at all of their locations, and Dig Inn has gone cashless at most of its locations.

 Sign at the register of Meyer’s Daily Provisions via FourSquare user Chris M. Sign at the register of Meyer’s Daily Provisions via FourSquare user Chris M.

There are some clear reasons that more and more restaurants have been ditching cash.

First, it’s safer for restaurants to not have large sums of cash on site. If you don’t have cash, you’re far less likely to be robbed. Park Cafe in Baltimore was robbed five times in just four months before it went cashless in 2017. Not only is it safer to not keep cash on-site, it’s also cheaper. When restaurants accept cash, they transfer it to banks in armored vehicles. Doing away with cash lets restaurants cut that cost.

Going cash-free makes things easier for restaurant employees as well. At most restaurants, employees spend time counting cash and also change out cash trays in between shifts. Without having to manage cash, employees will be able to devote more time to their other job duties.

Many restaurants believe that going cash-free is better for customers too. Salad chain Tender Greens, says that going cash-free has been popular with their customers who are often in a hurry. At cash-free restaurants, customers merely need to slap down a card instead of searching for the right amount of cash and waiting for change. If everybody at a fast-casual restaurant pays with a card, the line will move much faster.

 Tender Green on a busy day via Inc Tender Green on a busy day via Inc

Moreover, when customers always pay with cards, it is easier for restaurants to track their purchases. According to Toast:

[It’s difficult to understand an individual’s buying patterns or reward them for their loyalty when they always pay with cash. If they use the same card every time, your machines will remember them. The same is true if customers pay with their smartphone using an app like LevelUp, which also helps them accumulate rewards points (plus, mobile payments are forecasted to grow to $142 billion by 2019). You’ll gain a better understanding of your individual customers with this data, which will drive your business insights.]

Also, paying with cards is way more sanitary than paying with cash. TIME reported just how germy cash really is:

[In a 2017 study published in the journal PLOS ONE, researchers swabbed $1 bills from a bank in New York City to see what was living on paper currency. They found hundreds of species of microorganisms. The most abundant were ones that cause acne, as well as plenty of harmless skin bacteria. They also identified vaginal bacteria, microbes from mouths, DNA from pets and viruses.]

The report also noted that cash can carry E. coli, salmonella and Staphylococcus aureus, all of which can cause serious illness.

It’s pretty unnerving that the same people who handle and deliver customers’ food are also regularly handling cash, isn’t it?

A statement released by Dig Inn about why they chose to go cashless at most of their locations echoes many of the sentiments of other cash-free establishments and adds that most customers now pay with cards anyway:

[In some of our restaurants, we’ve chosen to eliminate cash, accepting only debit/credit cards and payment through the Dig Inn app. We made this change in restaurants where 8% or less of transactions were cash. We exhaustively debated the decision, considering it from all angles before finally opting to go cash-free.

At Dig Inn, we carefully examine how every business action aligns with our values of sourcing ingredients from as close to home as possible, investing in our chefs, and serving delicious, vegetable-forward food. Most of our chefs’ time is spent prepping and cooking fresh produce, coaching kitchen teams, creating innovative lunch and dinner specials, and getting to know guests. All of this contributes to their growth and development as culinary leaders. But a sizable chunk of each day was dedicated to cash management – two hours to be specific. While we’ve got amazing cashiers tending the registers, our chefs are also restaurant managers and responsible for counting the cash, writing deposit slips, making bank runs, and buying change. Since we’ve removed the burden of cash from our teams, they can now devote their time and energy to serving guests and cooking great food.

Investing in our chefs also means investing in their safety. Moving to card-and-app-only payments means our teams aren’t holding onto large amounts of cash at any time, making them less of a target for theft in the restaurants or on the way to the bank.

As for your experience as a guest, eliminating cash leads to a more efficient and faster checkout, meaning more time for you and your sweet potatoes.]

Going cash-free sounds like a no-brainer, right? Not exactly.

Although there are some pretty compelling arguments for going cash-free, there are also some hidden costs.

By not accepting cash, restaurants are inadvertently discriminating against people who don’t have debit or credit cards (including ⅓ of Americans ages 18-37).

According to Linnea Lassiter, a former analyst at the D.C. Fiscal Policy Institute, employment status, income, race, and immigration status are among the biggest factors influencing whether or not somebody has a bank account. For example, many low-income individuals don’t have bank accounts so that they can avoid fees if they fail to meet a minimum balance requirement.

Cash-free restaurants also discriminate against teenage diners who are old enough to visit restaurants without their parents but too young to have their own bank accounts.

Some argue that refusing to accept cash payments violates customers’ legal rights:

[State lawmakers, a civil rights group, the National Retail Federation and a company servicing ATMs are all pushing back against the trend, claiming that refusing the greenback—on which  the US Treasury writes “This note is legal tender for all debts, public and private”—is simply un-American.]

Two years ago, Massachusetts signed a bill barring cashless restaurants into law. Now, other cities and states are mulling over legislation of their own.

On June 26th, D.C. city council member David Grosso introduced a bill that would prevent local restaurants from going cashless. The bill would make it illegal to discriminate against cash as a form of payment, post signs that cash is not accepted, and charge different prices for customers who pay with cash as opposed to a card.

Many restaurant owners also stand against the cash-free movement.

In an email to the Washington Post, Amsterdam Falafelshop owner Arianne Bennett wrote:

[Not everybody is able to buy a smartphone. Not everybody is in a position where they can get a credit card. Not everybody is even in a position where they have a stable bank account to be able to use the debit card. But they are hungry too and have $10 in their pockets and they would like to spend their legal American form of tender, known as cash, with you.]

So, should your customers put their cash away? As you can see, there a number of factors that you need to consider before deciding if going cash-free is right for your restaurant.

To Tip or Not to Tip? For Restaurants, the Debate is Just Beginning

Imagine the last time you went out to eat. When your server cleared your plates and returned with your check, you probably started calculating a tip without even thinking about it. Tipping is now just an automatic step in restaurant experience (and has arguably improved our mental math skills a bit!)

The origins of tipping can be traced at least as far back as the Roman Empire. Wealthy Americans brought tipping to the states from Europe in the 1850s so that they could show off their knowledge of European customs. And the rest is history.

While tipping has been phased out in Europe in favor of a hospitality-included model, tipping is now as American as apple pie. However, over the past few years, some restaurateurs have begun chipping away at the well-ingrained cultural norm by banning tipping at their restaurants and instead absorbing service charges into menu prices (once again taking a cue from Europeans).

Celebrity restaurateurs Danny Meyer and Tom Colicchio were at the helm of the movement. In 2015, Meyer announced that he would do away with tipping at all 13 restaurants in his Union Square Hospitality Group. His decision was decades in the making. In a 1994 newsletter, he wrote:

[The American system of tipping is awkward for all parties involved: restaurant patrons are expected to have the expertise to motivate and properly remunerate service professionals; servers are expected to please up to 1,000 different employers (for most of us, one boss is enough!); and restaurateurs surrender their use of compensation as an appropriate tool to reward merit and promote excellence]

 via Eater via Eater

When he finally abolished tipping in 2015, Meyer cited closing the gap between tipped, front-of-house workers’ and non-tipped back-of-house workers’ earnings as one of his main motivators. Under his tip-free model, every individual employee benefits from revenue-sharing.

Colicchio was also a vocal supporter of restaurants moving toward the tip free-model when he eliminated tipping at his flagship restaurant Craft in 2015. He told CNBC’s “On Money” that he chose to go tip-free so that he could compensate his staff members more fairly.

[We know through Studies at Cornell University that the amount of money left in the tip has very little to do with service, it has more to do with your accent, your race, or your gender.]

 Tom Colicchio via Bravo TV Tom Colicchio via Bravo TV

Meyer and Colicchio removed the line on the check where customers would typically add in a tip. To compensate for lost tips, the chefs raised menu prices around 20% so that they could increase their staffs’ wages. Hundreds of restaurants across North America have followed suit.

 via CityPages.com via CityPages.com  via Chicago Tribune via Chicago Tribune

However, some restaurants who have tried the model have abandoned it, citing lost business. Colicchio’s Craft is one of them. Colicchio reversed his tip-free policy in 2016. Although he still believed in the reasons that restaurants are going tip-free, he conceded that the model cannot be successful until all restaurants adopt it.

[At Craft, if I were going to pay my servers an hourly wage that is on [a] par with what they’re currently making, it would be in the neighborhood of $34 an hour. So back waiters or bussers in the range of $22. They’re making a good wage because of tips. Now, we do away with tips. The only way to fund that would be through raising prices. If the average tip is about 20 percent, we still have to raise prices 23 percent, because then you’re going to push up wages for everyone else. If I were to do it tomorrow, it puts me at a competitive disadvantage to someone who is just shopping online looking at prices. If everyone does it, then I think we’ll see some change.]

So, should your restaurant ban tipping? We’ve rounded up some of the most common arguments for and against going tip-free.

Arguments For Going Tip-Free

Higher BOH Wages

One of the most compelling arguments in favor of going tip-free is that it leads to higher wages for back-of-the-house workers like cooks and bussers. At restaurants where the average check size is steep, back-of-the-house workers typically make less than tipped servers even though their base wages tend to be higher. This data from Bon Appetit is pretty staggering.

 via Bon Appetit via Bon Appetit

Under the tip-free model, BOH workers are included in the restaurant’s revenue-sharing policy. That’s why Meyer reported raising menu prices just over 20% (20% is widely acknowledged as the standard restaurant tip). After going tip-free, Meyer raised the starting hourly pay for line cooks at the Modern from $11 to $14.

A Better BOH Staff

A positive side effect of higher BOH wages—in addition to more appropriately compensating staff members hard work—is a stronger BOH staff (which translates into higher quality food!). According to Seattle restaurateur Renee Erickson, who went tip-free at Sea Creatures, eliminating tipping is a good investment for restaurants because it results in less BOH turnover. Less turnover means less rehiring and retraining on your end as well as more experienced cooks.

More Wage Stability for Servers

Another reason many restaurants are going tip-free is to increase their servers’ wage stability. As you probably know, in many states, the minimum wage for tipped workers for tipped workers is lower than the minimum wage for non-tipped workers. In fact, only seven states require employers to pay tipped workers the full minimum wage. In the other 43 states, the minimum wage for tipped workers can dip as low as $2.13 an hour. Workers are expected to make up the difference with tips (employers are legally obligated to make up the difference if servers earn less than minimum wage after tips, but investigations by the Wage and Hour Division of the Department of Labor between 2010 and 2012 found an 84% non-compliance rate).

 via dol.gov via dol.gov

Although tipped workers have the potential to make great money through tips, that is entirely dependent on check size and what percent of the total bill customers decide to tip. So, while tipped workers can make a lot in a day, they can also make very little. At restaurants with lower menu prices or where diners tend to tip less, FOH workers can actually make much less than BOH workers. In fact, a 2011 EPI study found that tipped workers are more than twice as likely as non-tipped workers to fall below the poverty line.

Moreover, research has shown that perceived service quality explains less than 2% of the variation in tip percentage. Clearly, your servers are being tipped based on factors that are out of their control. For example, young diners typically leave smaller tips. About ⅓ of millennials tip less than 15% (whereas only 16% of older demographics admit to doing so). In a recent survey, 10% of millennials said they don’t tip at all!

Replacing the tipping model with a revenue-sharing one leads to less income variation from day to day and moderates the effect of working a slow shift or serving particularly stingy diners.

Tipping is Discriminatory

Additionally, as Colicchio said, tip sizes are often unfairly based on factors like race, age, and physical appearance. On average, nonwhite servers make less than white servers for equal work. Dr. Michael Lynn, a professor of food and beverage management at Cornell University’s school of hotel administration and a leading authority on tipping research, says that this data qualifies tipping as discriminatory and therefore calls the legality of tipping into question. He explains:

[Specifically, the results suggest that the use of tips as a means of compensating workers may violate the Civil Rights Act of 1964, which prohibits employment discrimination on the basis of race, color, religion, sex, or national origin. The idea that employers might be held liable for the discrimination of their customers will come as a surprise to many, so it deserves elaboration. In Grigg’s v. Duke Power Company (1971), the Supreme Court rules that the Civil Rights Act of 1964 prohibits business policies that have a disparate impact on protected classes of applicants and employees even if those policies and practices appear at  face value to be neutral and are not intended to discriminate.]

Tipping Perpetuates Sexual Harassment

Living off of tips provides an incentive for employees to tolerate inappropriate behavior from customers. According to a Restaurant Opportunities Centers United report:

[Tipped workers experienced higher rates of harassment via media from customers than non-tipped workers. Tipped workers reported higher rates of inappropriate letters, ‘sexts’ or texts of a sexual nature, and photos from customers. Tipped workers also reported higher rates of harassing physical behaviors from customers, including pressure for dates, suggestive looks, deliberate touching, and inappropriate kissing. Tipped workers also experience higher rates of certain verbal harassing behaviors from customers such as sexual teasing and being told to flirt and expose themselves.]

 via rocunited.org via rocunited.org

The same report revealed that tipped workers also experience more sexual harassment at the hands of their employers. For example, female tipped workers’ uniforms are typically more suggestive than female non-tipped workers. Moreover, a server from Houston explained that hiring criteria often places demands on women’s appearances. The server reported, “[They] would say, ‘I want this many servers, none of them fat, none of them ugly.”

Arguments Against Going Tip-Free

Many Servers Oppose the Policy

Regardless of your intentions, servers may not be happy about you banning tipping at your restaurant. Many servers, especially those who are used to collecting generous tips, are opposed to the tip free model. After Bar Agricole went tip-free, servers made an average of $20-35 an hour instead of $35-45 an hour. The pay cut led 70% of servers to leave the restaurant. Likewise, Meyer says he lost 30-40% of his FOH staff after eliminating tipping at his restaurants (one Union Square Cafe server claims that her annual pay dropped $10,000). So, while going tip free has been shown to reduce BOH turnover, it can increase FOH turnover.

Customers Oppose the Policy

Apparently, customers aren’t too happy about restaurants going tip-free either. A 2016 survey found that 81% of Americans were opposed to the idea of eliminating tipping. Why? There are a few plausible reasons. First, people believe that the service is worse at tip-free restaurants because there is no incentive for servers to perform well. Second, research shows that people are happier when they can leave a large tip. Third, people have the urge to penalize poor service. So, when customers lose the ability to adjust tip size, they feel alienated.

According to Dr. Lynn, tip-free models can lead to negative reviews. When Dr. Lynn looked at Google reviews and yelp ratings for 18 Joe’s Crab Shack restaurants where the company temporarily suspended tipping. Ratings on a five-point scale decreased by a third of a point on average during that time.

Some customers have gone beyond leaving negative reviews. In October, consumers in New York and the Bay Area filed a class action lawsuit against, Meyer, Colicchio, and other notable restaurateurs who have gone tip-free. They alleged that the owners were holding secret meetings and eliminating tipping for the sole purpose of raising prices as part of an anti-competition conspiracy.

Diners May Experience Sticker Shock

According to Dr. Lynn, customers experience “bundled” prices differently than they do “partitioned” prices. So, even though customers will eventually have to add gratuity at restaurants that accept tips, they see menu items as cheaper than at restaurants where hospitality is already included in the menu price. When NYC restaurant Fedora went tip-free, customers ordered less food or lower-priced wines. This led to a loss in revenue, so the restaurant reinstated tipping after four months. Colicchio reported a similar experience.

To be fair, customers do end up paying a bit more at tip-free establishments because restaurants often raise menu prices more than 20% so that they can share revenue with FOH and BOH employees. This means that customers could pay up to 5% more if they usually tip 20%, or more if they usually tip less than 20%.

It’s pretty clear that whether or not you should tip free depends on a number of factors. For example, when determining what’s best for you and your employees, think about the average check size at your restaurant and how your customers would react to higher menu prices.

So, where do you stand in the tipping debate?

Restaurants Banning Plastic Drinking Straws are on the Rise: Will Yours Be Next?

As the trend away from disposable plastic, particularly plastic drinking straws, builds momentum, the restaurant industry is taking notice and adopting alternatives.  Compostable straws, utensils, and packaging are now requirements in some markets.  Many businesses, from large franchises to individual establishments, are jumping out in front of the legislative wave and replacing their own offerings proactively.  What else can we expect as plastics are slowly phased out?

New Precedents Appear

On July 1, 2018, Seattle became the first major city to ban the distribution of plastic drinking straws and utensils.  The move was virtually concurrent with the Seattle-based Starbucks franchise switching to straw-less lids in its shops throughout the country.  And while Starbucks has no trouble making news headlines, there is an ever-growing number of businesses following suit.  Foodservice distributors, hotel chains, ballparks, airlines, and of course cocktail bars have all joined the ranks of the eco-friendly.  McDonald’s has set a target timeline of 2025 to phase out its own non-compostable utensils.

Miami Beach and Fort Meyers, Florida, as well as Malibu, Davis, and San Luis Obispo, California, have similar prohibitions on single-use plastics.  New York is expected to eventually enact its own similar ban in due time.  Elsewhere in the world, Canada, the United Kingdom, and the European Union as a whole are weighing proposals banning plastic straws.  From there, it’s easy to foresee the domino effect continuing.

The legal precedents away from plastics are nearly a decade old: in 2009, Washington D.C. enacted a law requiring businesses to charge a $.05 surcharge for plastic shopping bags.  In grocery stores especially, there has been a longtime push to at least offer alternatives, such as lightweight reusable bags.  You can see the footprint of plastic bag legislation here:

 Source:  http://bit.ly/2v7UuB7 Source:  http://bit.ly/2v7UuB7

Motivations Behind the Change

Environmental consciousness lies at the root of the movement away from plastics.  Marine wildlife has been hit hard by the effects of pollution.  Even responsible sanitation practices will inevitably yield some spill-off into rivers, lakes, and oceans.  Since it can take hundreds of years for a typical straw to decompose, birds and sea creatures of all sizes are left vulnerable to this floating junk.

Garbage patches (or trash vortexes) are collections of marine debris that have formed in the world’s oceans.  The debris consists of various plastics, chemical sludge, and other garbage, clumped together as a result of the cyclical currents.  Garbage patches float near the top of the water.  As well as a tremendous eyesore, they can be toxic and ultimately lethal to the nearby marine wildlife.

 Garbage patches accumulate and circulate around oceanic gyres.Source: http://bit.ly/2A8IViG Garbage patches accumulate and circulate around oceanic gyres.Source: http://bit.ly/2A8IViG

In the social media era, it’s easier than ever to make a cause célèbre out of unfortunate wildlife hurt by pollution.  But it’s just as prudent to consider the limited space for the waste products of expanding human populations.  Plastic is a natural target for replacement with biodegradable alternatives.

There is a human health risk in play as well.  Bisphenol A (BPA), a chemical used to harden plastics, has been flagged as a concern by the Food and Drug Administration.  Infants are considered especially vulnerable to the effects of ingesting BPA, with possible brain development and behavioral issues cited as potential symptoms.  The effects of BPA on adults is still an ongoing study.  The FDA recommends reasonable precautions, such as avoiding heating foods and drinks stored in plastic.

While plastic drinking straws account for only a very small fraction of total plastic pollution, environmentalists believe that this small step can raise overall awareness and inspire the public toward more significant change.  Individuals who wouldn’t otherwise consider the environment in their daily choices will be more conscientious when the issue is presented in their daily routines.  The hope is that this modest measure will inspire people to further their recycling efforts on an even greater scale.

How Will This Affect the Restaurant Industry?

 Source: http://bit.ly/2v9IOO7 Source: http://bit.ly/2v9IOO7

Even if plastics have not been outright banned in your area, expect the phasing out process to proceed slowly but surely.  If you own a business that uses disposable utensils, there are some considerations to keep in mind in the coming months and years.

The cost of compostable utensils currently sits higher than the plastic status quo.  The precise cost of upgrading might be hard to calculate.  Vendors have cited anything from 10% to 200% above, depending on the size of the order and the quality of the biodegradable supplies.

If you replace a plastic drinking straw that costs $.02 with a compostable drinking straw that costs $.04, that microtransaction looks rather insignificant.  But if you serve thousands of straws every month, that small uptick can account for hundreds of dollars against your bottom line.

Look to buy in bulk.  An easy way to offset the increasing cost of supplies is to simply acquire them in larger quantities.  Businesses considering this change should think about how much space they can spare in their physical inventory.

Keep tabs on price points.  Like any emerging market, increased demand for compostable utensils will drive a larger supply.  This, in turn, will eventually lower prices.  If your business isn’t ready to make the switch away from plastics just yet, remember to check back every so often to see if the market has moved.

Can you do without?  Some cocktail bars are replacing their plastic drinking straws with no straws at all.  If you typically serve, for example, soft drinks for the table with straws inserted, can you simply eliminate them?  One immediate way to reduce your plastics usage is by keeping those products complimentary, but making them available only upon request.

Flaunt it if you’ve got it.  While the cause is noble, there is no shame in advertising that your business has taken an environmentally-responsible initiative.  This is absolutely an opportunity to do a bit of status-signaling.  Adding a line at the bottom of your menu or posting a small notice about the change in policy in your storefront will let your customers know you’re mindful (without being overbearing).

The recent trend of restaurants phasing out plastic drinking straws is arguably just the beginning of a bigger movement to save the environment. Keep tabs on any updates, including that of the law, to stay informed of the latest advancements. And in the meantime, consider how your restaurant will adopt.

The Coffee Industry is Changing: How Will Your Business Adapt?

Coffee. For most people, coffee is the fuel that gets them going in the morning (I know it is for me). Whether it’s a cup brewed at home or an iced latte grabbed on the go, the average coffee drinker has 3 cups per day. In the US alone, there are 150 million daily drinkers. Of course, drinking coffee isn’t a new trend. It’s been around since the discovery of the “coffee berry” in Ethiopia way back when in the year 850.  But, the ways in which we consume the hot (and cold) stuff has quickly evolved in recent times.

Because of its increasing popularity, the $100B coffee industry itself is currently experiencing growing pains. There is ample room for opportunity, but where there’s opportunity, there are also threats. CBInsights says:

[Global coffee production is hitting record highs this year, and analysts predict consumption growth of 5-7% through 2025.

Young people in China are drinking more coffee, while Americans are drinking more expensive coffee — opening huge opportunities on both fronts.]

Good news, right? Of course, coffee production companies will have to adjust to supply accordingly, especially those suppliers in the U.S. More countries that are usually top coffee suppliers are becoming avid coffee drinkers, which means fewer beans available for export to the US. Here are the top 4 coffee exporters based on 2017 data:

  • Brazil: US$4.6 billion (14.1% of total coffee exports)
  • Vietnam: $3.5 billion (10.7%)
  • Germany: $2.64 billion (8.1%)
  • Colombia: $2.58 billion (7.9%)

The United States is 12th on that list, which means we’ve got to step up our coffee production game if we want to keep enjoying those fresh cups of joe.

So, what does all this coffee news mean for the restaurant industry? Well, the demand for coffee is present and will most likely trend upwards. But, brick and mortar locations are at a low when it comes to growth rate. Why? Because there are plenty more options today than just grabbing a hot cup of coffee at the local diner or cafe.

If you’ve recently been in any big-box supermarket or convenience stores, chances are you’ve seen a dozen or more options for grab-and-go coffee. Bottled, boxed, or canned, coffee is available in multiple forms and flavors. This segment of coffee is called the ready-to-drink market and major brands like Starbucks and Dunkin Donuts have already caught on. Cold brew, a term that was foreign until the late 2000s, has become a massive phenomenon in recent times. Cold brew is served both in brick-and-mortar locations and in the ready-to-drink form. And it’s a huge hit with millennials.

 via Spoon University via Spoon University

According to CNBC:

[The ready-to-drink coffee market is forecast to show 67 percent sales growth from 2017-2022, according to Mintel. It also said the ready-to-drink coffee market is the fastest growing segment within the retail coffee market.

“The ready-to-drink coffee market is growing at a very, very strong rate and one of the fastest growing non-alcoholic beverages in general,” Bryant told CNBC.

The ready-to-drink market is certainly a strong competitor to kind of traditional coffee shops because these drinks have become more premium, more specialized and come in a variety of flavors as well,” said Caleb Bryant, senior foodservice analyst at Mintel. “And generally they might be less expensive than something you get at a coffee shop.]

Of course, brick and mortar restaurants, cafes, and coffee shops have to keep this ready-to-drink segment on their radar. But, the good news is millennials are willing to spend more for a fancy caffeinated beverage. As a millennial myself, I think that the ready-to-drink options are convenient and useful in a pinch, but I would still much prefer enjoying a fresh roast at a real cafe.

When it comes to how coffee drinkers go about prioritizing what’s important, we found this infographic by My Coffee Pro quite interesting:

It’s clear to see that people find convenience, location proximity, and good quality product the most important factors of their coffee decisions.

Since the brick-and-mortar growth rates are currently low, you should jump on the opportunity to make it known that you serve what the masses are looking for. Market your business creatively and get your full menu online. Millennials are a great demographic to target & they’re doing online research to discover new spots to drink & dine, so it’s essential to be in all the places they’re searching. Get hyper-local in some of your marketing efforts to make sure you’re reaching an audience near your location. Most people are looking for a morning or afternoon pick-me-up nearby, so you want to let it be known that you’re available and close!

In the wake of a changing coffee landscape, below are a few ideas on how to stand out from the rest of the java crowd.

Create an Exclusive Drink

Starbucks’ Pumpkin Spice Latte isn’t a drink, it’s a lifestyle. Dunkin Donuts chooses seasonal syrups like Cookie Dough and Peppermint Mocha and then includes the limited-time flavors in any drink you can think of. McDonald’s just released frozen cold brew – a midsummer day’s dream. The moral of the story: people love exclusivity, limited-time offers, and creative concoctions. So, come up with your own! The big guys aren’t the only players who can entice customers with one-of-a-kind items. Dream up, test, and serve drinks that are exclusive to your business and too delicious to deny. Then market those drinks as a limited-time summer (or fall, winter, or spring) offer and get people excited to try them out. You can create buzz around your business simply by being creative and original. But, remember, marketing is a key tactic in all of this. Drum up buzz on your social channels, send email blasts, and make sure your menu is updated everywhere!

Make it An Experience

You may not be a business solely dedicated to coffee but still serve it as your restaurant. Even if you are exclusively a coffee shop, you may want to consider making the experience more “DIY.” Although fast-casual dining is uberly popular, people are still interested in making dining out a true experience. According to a survey by Eventbrite, 75% of people said that they believe unique dining experiences are worth paying more for. So, capitalize on this by offering a one-of-a-kind experience at your location. Try out an upscale coffee bar, complete with different mix-ins and toppings, so guests can create their own potent potion. You can charge a fee per addition or a flat fee based on cup size. You can even set up a photo station with great lighting and props to inspire guests to take photos to post on Instagram.

You may even consider a “pop up” coffee stand outside of your location’s entrance or even in a completely different location. You can make this a limited time offering just for the warm months to offer cold brew and iced coffees. If you have an inviting outdoor area, you may just tempt guests to stay a while longer.

Market, Market, Market!

 via Kays Boutiques via Kays Boutiques

It’s tough to compete against big-name brands and convenient coffee options. But, as we already mentioned, you’ve got something that makes you unique. Marketing goes a long way when it comes to both customer retention and bringing in new guests. Make sure to dedicate some effort to marketing. You can send email newsletters to customers you have email addresses for to tell them about new item releases and exclusive drink deals. If you’re feeling generous, offer coupons for new drinks or a rewards program for multiple visits. Post updates frequently to social media and use high-quality, attractive photos to catch followers’ eyes. Make sure to geotag your posts and encourage others to do so as well so new guests know where you’re located.

Get your menu online, with the help of a menu management company, so people searching for “coffee near me” can find you (remember, location is important to customers!) With the help of menu management you can gain visibility on the sites that matter – like Google, TripAdvisor, Yelp, and many more. Getting the word out there about your brand and your products will help you attract more coffee lovers.

Coffee has been around since before you or me, but the way in which we drink it has changed drastically over the years. A simple percolated pot of coffee has evolved into an artistically topped latte and cold brew in a can. As a restaurant or cafe owner, you should be mindful of how the coffee landscape is changing and how it affects your business. You want to continue to bring in business despite the existence of competition, so think of new and exciting ways you can offer, and market, your cup of joe.

Meal Kit Delivery Services: How Will Your Restaurant Compete?

Each morning, I listen to a podcast on my way to work. Without fail, at least twice a week, the regular programming is interrupted with advertisements for Blue Apron and HelloFresh. You’ve probably heard of these companies too. They, along with a slew of other meal kit services, deliver pre-portioned ingredients straight to customers’ doors so that they can make restaurant quality dishes like brown butter gnocchi and provolone burgers with marinated kale at home.

 via Hello Fresh Instagram via Hello Fresh Instagram

The meal kit delivery concept originated in Europe in 2007 and has exploded in the United States over the past few years. Now, there seems to be a delivery service to cater to every culinary niche. For example, Sun Basket offers paleo, vegan, vegetarian, and pescatarian options, Purple Carrot is 100% vegan, PeachDish focuses on Southern specialties, and GreenBlender is exclusively for those who prefer to drink their meals. Collectively, meal kit services are said to rake in a whopping  $1.5 billion in sales each year and, as of last year, the industry was worth an estimated  $4.65 billion.

So, where are those billions of dollars in sales coming from? According to Nielsen, one in four Americans had tried a meal kit service as of March 2017. Neilsen’s study also found that men of all ages are 40% more likely to purchase meal kits than women of the same age and that Millenials and Gen Xers are 321% more likely to buy them than older generations. Moreover, households with children are 326% more likely to purchase meal kits than households without children.

While restaurant traffic has slowed over the past year, meal kit sales are growing exponentially. Now, grocery stores and other major retailers are getting in on the action.  In 2017, Kroger introduced a line of Prep+Pared meals and Amazon began offering meal kit deliveries to select cities. This year, Walmart rolled out its Home Chef Meal Kits at more than 2,000 of its stores. This means that meal kits are now more readily available to the general population than ever before. Therefore, it’s not so hard to believe that the meal kit delivery market is predicted to be worth about 11.6 billion dollars by 2022.

So, how can your restaurant compete with these services? We’ve compiled a list of ways you can make sure you don’t lose sales to meal kit delivery services.

Make Ordering a Cinch

In order to compete with meal kit delivery services that automatically send meals to customers’ doors, you should make ordering ahead as quick and easy as possible. For example, instead of requiring customers to place pickup and delivery orders over the phone, allow them to place their orders online.

Not only is online ordering convenient for your customers, it’s also better for you! Online ordering improves order accuracy (there’s no risk of mishearing a customer and customers can check their selections before they submit them) and digital orderers spend $4 more on average than non-digital orders.

If you’re already partnered with a third-party food ordering service like Grubhub or Seamless, that’s great. Not only do these services make ordering easy, they can also make it easier for new customers to find your restaurant.

It can also be very beneficial to implement your own in-house online ordering software so that customers can place their orders directly on your website. Not only does in-house software allow you to customize your interface, you also won’t lose profits to middlemen. As a result, you’ll boost your revenue. Check out how easy it is to place and customize your order on Boloco’s website.

Offer Cooking Classes

According to a study conducted by Market Force Information, of respondents who had tried a meal kit service, 44% did so because they thought it would be a fun experience, 27% did so because they wanted to learn new cooking techniques, and 26% did so because they wanted to improve their culinary skills.

You can offer diners all three of those things by holding cooking classes at your restaurant. Restaurant-bakery Le Pain Quotidien holds a variety of cooking and baking classes. Prospective students can choose from a course catalog including artisan pizza making and biscuit and scone making. New York eatery Thaimee Table, formerly Ngam, offers Thai cooking classes. Whatever your restaurant’s specialty is, diners may be interested in learning how to make it. Consider gaging interest in a class at your restaurant in order to boost revenue.

Bread making class at Le Pain Quotidien (Tiny Oranges)

Highlight High-Quality Ingredients and Healthy Menu Items

Another common reason that individuals opt for meal kits is for their high-quality ingredients and options that accommodate different dietary restrictions. Many meal kit services heavily advertise their use of organic, antibiotic-free, and sustainable ingredients as well as their low-calorie and diet-friendly options. Additionally, home-cooked meals are generally assumed to be healthier than restaurant ones.

Because restaurants meals often get a bad rap for being unhealthy, you should make it a point to mention if ingredients are organic or locally sourced and if dishes are vegetarian, vegan, gluten-free, or otherwise healthy options. You should also make it as easy as possible for customers to alter dishes to accommodate their particular diets. Some restaurants even note on their menus which items can be made vegetarian or gluten-free upon request.

Make Customers Offers They Can’t Refuse

Many of the meal kit companies offer special deals to attract new customers. For example, Blue Apron offers $20 off of each of customers’ first three boxes and HelloFresh offers up to 50% off customers’ first boxes. According to Fast Company, all of the price competition between services leads many customers to jump between companies so that they can take advantage of the discounts that each of the companies have to offer.

Clearly, discounts are a good way to acquire customers. So, to better compete with meal kit delivery services, consider offering coupons or Groupon deals or implementing loyalty programs that reward customers for repeat visits. In case you need another incentive to start a loyalty program, customers spend 46% more when businesses have loyalty programs.

If You Can’t Beat ‘Em, Join “Em

Finally, you can try offering meal kits of your own. 49% of adults said they would buy a meal kit from their favorite restaurant. So, why not give the people what they want?

You can either try a pilot program in which you deliver meal kits that help customers prepare your most popular dishes at home to their doors each week or just sell meal kits at your location.

(Restaurant Hospitality)

Strip House in New York City offers “Steak to Go” kits that include two each of barrel-cut filet mignons, prime center-cut strip steaks, and dry-aged boneless ribeyes as well as the restaurant’s signature pepper blend, oil, seasoning, steak sauce, and grilling tips. They typically sell 20-30 kits each week.

(Restaurant Hospitality)

Dos Caminos restaurant offers a “Guac’Tailing To Go Kit” that includes all the ingredients customers need to make guacamole and margaritas at home.

The creators of  Boston Burger Company created a BurgaBox Burger Meal Kit that provides ingredients for four burgers and two sides. Co-owner Chuck Sillari shared some advice for other restaurant owners hoping to get into the meal kit business. “I think only operators who can execute properly should consider meal kits; they’re a totally different world compared to running a restaurant. A lot of testing and tasting go into the creation of every kit,” he told Trendista. “But, if you love making your people happy and can do it right, I say do it. It’s great to see people get so excited about provides what we’re doing.”

Meal kit delivery services are everywhere. Is your restaurant ready to compete?

It’s All In The Ingredients: 5 Trending Foods To Entice Hungry Customers

Dining out is an experience that is meant to be satisfying, fun, and an escape from the norm of cooking at home. Choosing a restaurant to eat at, however, is not always an easy task. A potential customer must first decide what type of cuisine he is craving. Of course, his budget will dictate how much money he’s willing to spend on a meal. The distance he is willing to travel becomes a factor. Once he has decided on those factors, his cell phone, otherwise known as a handheld restaurant search guru, becomes his best friend. And even still before ultimately choosing a restaurant, what’s offered on the menu is observed. That’s when the Uber is called.

In 2018, it is essential that a restaurant has dishes on its menu that stand out to customers. This is what we’ll refer to as the trending foods. Because, let’s face it, trendy is interesting to most people. While sometimes it’s best to stick to what you know well, menu diversity is key and will attract a wider range of patrons. Give them what they’re looking for! Food trends can be fleeting, or they can become long-term staples. Inclusions or omissions from the menu can make you or break you as a restaurateur. Here are 5 trending food items we think you should seriously consider incorporating into your recipes today.

The “Instagrammable Item”

If your restaurant doesn’t have an Instagram account, consider making one. 93% of people use online menus to determine where to eat, but many are now also making choices based upon the restaurant’s Instagram pictures, as well as posts from food bloggers and social influencers. If a dish sounds good people will think about getting it. If a dish looks good people will want to eat it. Having items on your menu that are trendy and “instagrammable” are bound to attract crowds. Not to mention, it’s pretty great for advertising. People order your dish, tag your restaurant, and instantaneously their meals have been shared with a whole social network of fellow foodies. Whether it’s a cheesy appetizer, a juicy cut of beef, or a sinfully gooey dessert, a dish that photographs well creates exposure and excitement. Your eatery has become more than a restaurant; it is now a destination. Make sure you’re posting and sharing high-quality photos of your food to entice potential guests. Instagram-worthy foods of the moment are sky-high milkshakes, decadent doughnuts, and cheesy (the positive meaning of the word, that is) items ranging from burgers to pasta to fries. Will your restaurant create the next big trend in food?

Avocado

Like the latest runway fashion trend, avocado is in. It’s healthy, colorful, AND tastes good. Not to mention, it’s high in fiber, good fats, and vitamins and low in sugar. How can you beat that? Avocado is something that should play a part on every restaurant’s menu. Its popularity has significantly risen over the years and continues to trend upwards. Whether the fruit (yes, it’s a fruit) is incorporated in breakfast, lunch, and/or dinner, on toast or in salads or sandwiches, avocado can be used creatively and deliciously. Including avocado as an ingredient is a great way to attract diners. People trying to be healthy can now enjoy their meal, feel good about it, and return for more. Capitalize on this opportunity.

Bacon

Bacon is an oldie but goodie. Some may even question whether it came first before the egg. They go hand in hand, but that’s not the only combo involving bacon you can offer. Some will argue that bacon makes every dish infinitely better; it has somewhat of a cult-like following. And Americans are eating about 18 lbs of it per year! Unlike avocados, bacon is something you know is not the healthiest for your diet, but some believe it is something worth spending extra time on the treadmill for. Adding bacon to some of your less popular dishes will make them a hit. A bacon wrapped filet sounds better than just a steak. Brussels sprouts with bacon bits sound better than plain brussels sprouts (which, by the way, are a current trend you may want to consider as well). Well, you get the point. You can even take the lighter approach and use turkey bacon in your dishes. This is not only healthier but it allows people with certain food restrictions, like Kosher and Halal, to enjoy the meal too. There are even vegetarian and vegan bacon options! The possibilities are endless.

Truffles

Truffles are part of the fungi family, but we’re confident that won’t scare your guests away! Just the word truffle sounds fancy, so people will be inspired to order it. In addition to sounding upscale, it is delicious and has a great aroma. The beauty of truffles is that they can be used in different ways. Whether it be black or white truffles shaved onto your pasta, or a truffle oil that is drizzled on top of a pizza, it is something that sets the dish apart. Once your customers experience the taste and the smell of truffles, the uniqueness leaves a lasting impression that they will not soon forget. They’ll want it again and again. Translation – repeat business! Find out here how Michelin star chefs incorporate the exotic ingredient into their dishes.

Specialty Cocktails

Everyone loves to eat, but what about the drinks? Having an impressive drink menu can help your restaurant cater to a sector beyond just foodies. Not sure what to offer? At the moment, culinary-inspired cocktails and local spirits, beer, and wine are trending. Get creative with the ingredients you choose and use fun cocktail names. You can even run a contest with your social media followers to come up with the best names for your cocktails by providing details about the ingredients. Serving great cocktails can not only enhance the dinner experience but create a lively bar scene. Having a drink in hand also makes it easier for patrons to wait for a table to open up during peak hours. People who are drinking are more likely to order more food and linger at your establishment longer. Shaken, stirred, or muddled- a unique drink menu will help you maximize profitability as well as create a positive customer experience. (Bonus points if the cocktails look good on Instagram!)

Your restaurant has many features to distinguish itself from the one down the block. You’ve painstakingly tended to the details of the décor, hired the friendliest and most experienced staff, but your menu is your bread and butter. Don’t miss the boat by sticking to the mundane. Sprinkle in a dash of new. Pick a few of the trending food items that people are buzzing about and offer them. Keep track of how popular the dish is & make adjustments accordingly. Do people love avocado-infused dishes? Offer more! The great thing about food is that it offers a chance to experiment, so take advantage of this to make some amazing (and tasty) art.


Thanks for reading. Interested in improving your restaurant’s online presence? We can help! SinglePlatform puts your menu and business information accurately on the search, review, travel, and social sites people are using to find new restaurants. Get in touch today to learn how we can help you stand out everywhere that matters online.

Veganism is at an All-Time High: Is it A Fleeting Fad or The New Norm?

It seems like no matter which way I turn, what restaurant magazine I’m reading, or food blog I stumble upon, the word vegan is showing up more than ever before. This isn’t a coincidence, my plant-based friends (and carnivores alike). Veganism is on the rise, and there are stats to prove it. In this blog, we explore the current state of veganism and how it is influencing changes in the restaurant industry.

The Facts

[There’s been a 600% increase in people identifying as vegans in the U.S. in the last three years. According to a report by research firm GlobalData, only 1% of U.S. consumers claimed to be vegan in 2014. And in 2017, that number rose to 6%.]

A 600% increase in veganism in the U.S. in only 3 years is a staggering statistic. It’s pretty obvious that more and more people are moving toward a plant-based lifestyle. But, when I look at this green machine revolution from my own perspective, the presence of veganism doesn’t seem as overwhelming as research shows. I only know one vegan personally. I also have a couple of vegetarian friends, but for the most part, the majority of my circle enjoys a good cut of beef. Still, I live in Brooklyn, which as of recent has been known for its influx of innovative restaurants and as a hub for food trends. Needless to say, there are vegan options galore if you’re looking for them, or even if you’re not. I’ll bet that if I walked within a few blocks of my apartment I could find non-dairy fettuccine alfredo or buffalo tofu sliders in 100 steps or less. More and more I’m seeing popular, traditionally meat-filled Americana classics, like burgers and buffalo wings, transforming into vegan-friendly dishes. There are even meat-free burgers that take on the disguise of real ones, red with “blood” and all.

Just as with anything else, location plays a huge role in current restaurant and food trends. If I was living in the heart of Houston, I’m not as confident that there would be such an abundance of vegan options.

This shift in dietary decision isn’t only within the United States. The adoption of a plant-based way of life started as a fringe movement but is now echoing around the world. Search data from Google Trends shows an impressive worldwide increase in the interest in veganism from 2004 to 2018. Top regions include Israel, Australia, Canada, Austria, and New Zealand. Seven percent or about 3.5 million people now identify as vegan in Great Britain. But, although the U.S. and U.K. round out the top 3 vegan countries by percentage, India takes the first spot with veganism encompassing 27% of the population. This comes to me as no surprise, though, as India has long been known as widely vegetarian. It will be interesting to see how these percentages shift if embracing of the diet continues to trend upwards.

The Reasons

So, why do people turn vegan in the first place? As we can see from the influx in recent years, it’s not just because they were born into the lifestyle. Most people probably made an educated, conscious choice to swear off meat and dairy altogether. A study based in the U.K. reveals:

It doesn’t surprise me that health and weight management are the top reasons why people are turning to veganism. Food allergies have been on the rise, with 1 in 13 children affected in the United States and a 50% increase in allergies from 1997-2011. Top foods that cause these reactions? 90% of food allergies come from milk, eggs, peanuts, tree nuts, soy, wheat, fish, and shellfish. A large number of people also suffer from food-related illnesses like celiac disease (1 in 133 Americans) and lactose intolerance (30-50 million in the U.S.), which have a direct influence on diet choices and food restrictions.

Aside from allergies and conditions, some people go vegan in hopes of living a healthier lifestyle. Red meat has long been linked to diseases like diabetes, heart disease, and stroke. Chicken is notorious to be a breeding ground for salmonella, and fish poses a threat of mercury. Some people just believe that plants are healthier than animal products.

Research conclusions from recent studies have come out on both sides of the coin.

A Time Magazine article explores whether or not vegan is actually better for health. From that, we extract some key findings from both sides:

[A 2015 Study from the University of North Carolina showed that veganism came out on top as the best diet for weight loss. Another study linked it to “significantly lower rates of heart disease and cancer.” However, a professor from Colorado State University notes that there aren’t any clear mortality benefits, and that vegan diets may be less healthy than those including meat due to the lack of essential nutrients like B12.]

In my opinion, it’s too early to say whether or not a vegan diet can significantly improve health. I’ve heard about a number of different diets and each and every one has been both praised and discredited. Personally, I stick to eating meat (and vegetables too, of course) because I find it to be both delicious and a good source of protein and other nutrients that I just can’t see coming from all plant-based products. Of course, I don’t suffer from any dietary restrictions, which plays a part in what I choose to eat. If I had an allergy or condition, I’d have to make the proper adjustments. Still, since veganism has just recently picked up in popularity, I think it’ll be beneficial to revisit the research in the coming years, with a larger sample size, so we can get a better comparison between different diets to better weigh the positive and negatives.

The Effect on the Restaurant Industry

So, just how is veganism affecting the restaurant industry? It’s been identified as a major food industry trend for 2018 by chefs around the world. And some restaurants are already acting on it. Gauthier Soho, a French fine dining establishment in the U.K., has plans to go completely vegan within the next two years. When I came across this article I thought to myself, “wow, I don’t even know what I’d order there.” Now I know how it feels to be a vegan in a steakhouse.

Forbes is even predicting that fast-food giants will incorporate vegan options into their menu strategy, noting that a chain, Plant Power Fast Food, is already making its mark on the industry. I think that we’ll see even more well-known restaurant chains and popular dining establishments adopt a more vegan-friendly menu in the near future.

But, let’s take a step back for a minute. Even before the rise of veganism, restaurants throughout history have had to make adjustments to suit all different kinds of needs, from dietary restrictions like allergies to including vegetarian options. Being dynamic is an essential part of being a business, especially a restaurant, owner. Having the capability to adapt to this increase in veganism can help you gain a competitive edge. As more people make the decision to go vegan, there will be a heightened need for more inclusive dining options. Be there to fill that void before every other restaurant does.

Incorporating vegan items into your dining landscape is an example of how you can dynamically adapt to change.  Of course, that’s not to say that you should change every menu item from sirloin to tofu, but having a diverse offering can help you expand your customer base. An all-inclusive approach can not only help to win you more business but keep each and every customer satisfied.

If you are planning to go vegan, make sure you let your potential customers know. With 93% of people looking at online menus, it’s pretty much guaranteed that people are specifically looking for vegan options. Your in-house and online menus should accurately and clearly reflect your offerings so you can drive more business and fill more seats.

Clearly, adopting a vegan lifestyle is becoming extremely popular across the globe. As for me, I’m going to stick to my omnivore ways, but will be on the look-out for how restaurants and grocery stores continue to adjust. It’ll be interesting to see if the restaurant industry will evolve significantly in order to become more inclusive of vegan diets. For now, I’ll sit back, order a steak, and watch.


About the Author: Taylor Kelly is SinglePlatform’s Content Marketer.  She loves reorganizing words and cabinets, drinking iced coffee whether it’s summer or winter, and checking out the best happy hour spots New York City has to offer. Her goal at SP is to provide creative & informative content about anything restaurant & small business related.

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