Future-Proofing Restaurants: What to Expect in 2026

As restaurant operators prepare for 2026, they face ongoing challenges including labor shortages, increasing costs, evolving consumer expectations, and the accelerating pace of technology. At the same time, casual dining is experiencing a resurgence, value-driven diners want both good price and great experience, and automation is becoming a necessity rather than a novelty. Future success will depend on how well operators balance these pressures with new growth opportunities. 

To help operators navigate the road ahead, Modern Restaurant Management (MRM) magazine reached out to Cristin O’Hara, Managing Director and Restaurant Group Head at Bank of America, to discuss strategies for addressing price fatigue, holiday prep, leveraging AI and automation, bolstering fraud prevention, and adapting to this evolving dining landscape.

What are some robust strategies operators can implement to improve their day-to-day business that address labor challenges, control costs and set them on a profitable path?

While employee turnover is a usual issue for operators, it is not insurmountable and is certainly less of an issue than in the post-COVID days. To combat turnover, some operators have considered offering benefits such as retirement savings programs, tuition reimbursement, and flexible wellness options to entice talent. 

Operators can consider investing in upgraded systems and automated processes to reduce their reliance on manual labor. For example, self-service kiosks and automated drive-through interfaces can lessen dependence on front-of-house staff.

We are seeing that operators are focused on delivering value and experience to diners. By regularly reviewing pricing and promotions, operators can better meet the needs of these value-driven consumers.  Casual dining is proving that restaurants in different segments continue to be resilient depending on economic trends, circumstances and strategies. Currently, they are enjoying a resurgence as consumers are seeking value, quality and good social interactions.

As we head into the holiday rush, what are some things operators can do to meet the needs of diners who want an experience but are still seeking value?

Operators are constantly evaluating and adjusting their menu options. This, along with promotional deals, limited-time items, and loyalty incentives, can create urgency and encourage repeat visits. By striking the right balance between quality dining experiences and value offerings, operators can win customers and strengthen revenue. 

Casual dining is also having a moment. The combination of good-quality food and an elevated experience, compared to QSR, is resonating with today’s value-oriented diners.

QSR does employ the barbell strategy, offering a diverse range of options: indulgent items on the left of the menu board, standard items in the middle, and value items on the right. Having an array of choices appeals to diners seeking variety. Brands such as Chick-fil-A, 7 Brew, Dutch Bros., and Taco Bell have been particularly successful at delivering strong returns on investment for operators. 

Casual dining is also having a moment. The combination of good-quality food and an elevated experience, compared to QSR, is resonating with today’s value-oriented diners. Texas Roadhouse, Chili’s and Applebee’s have successfully executed this strategy. 

In what ways should restaurateurs be tapping into technology to better meet guest expectations? How much of an investment should they be looking to make in AI and automation?

Since COVID, technology has been an important driver of restaurant growth and competitiveness, essential for meeting and exceeding guest expectations. Restaurateurs can use technology to enhance convenience, personalization, and efficiency for their customers.

AI is primarily being used in drive-thrus, back-of-house operations, support centers, and kiosks. The challenge is striking the right balance, leveraging AI to improve throughput and accuracy without creating friction for customers, while also using the data collected to inform strategy.

AI-driven tools like chatbots can also support operators with analysis, including forecasting demand, optimizing menu performance, analyzing spending, and improving benchmarking. These insights streamline operations and ultimately elevate the guest experience.

While the level of investment in AI and automation will vary by concept and size, operators remain focused on returns.  A keen eye on strong ROI is the key to profitable growth.

What best practices should operators put in place to better mitigate the risk of fraud?

As restaurants expand their use of technology, cybersecurity must be a parallel priority. Fraudsters are increasingly leveraging sophisticated tools, including AI and chatbots, to craft convincing scams targeting restaurant operators. Between March 2023 and February 2024, the average cost of a hospitality industry data breach (which includes restaurant chains) was just over $3.8 million.  

It’s an issue I discuss with clients every day. We advise them to protect against data breaches and ACH fraud, invest in strong cybersecurity measures, train employees to flag unusual or suspicious activity, and leverage their bankers, advisors, and other partners to help secure transactions.

As restaurant operators look to plan for 2026, what are some key areas they should be paying attention to? What are some consumer behavior shifts or dining trends you anticipate will impact them?

Looking ahead to 2026, restaurant operators will need to navigate a dynamic landscape shaped by evolving consumer expectations and persistent economic factors.

Overall, these trends underscore the importance of adaptability and customer-centric innovation in the year ahead.

Consumers will continue to feel financial pressure while still wanting to dine out. They are seeking value but also expect good-quality food, and the overall experience will remain a priority.  Customers will continue to gravitate towards casual dining as many QSR brands adjust their value propositions. Price elasticity has hit a threshold that currently favors the casual dining segment. QSR is not going anywhere, but some tweaking is required to gain back market share.

The good news is that consumers are still spending at restaurants, and this trend is not expected to change, as evidenced by credit card spending data. Convenience remains important, and consumers still value not having to cook at home. While spending may be decelerating, as we saw this summer, it is still healthy.

While patrons will still frequent a range of restaurant types, the approachable service, diverse menu options, and perceived value offered by casual dining concepts will remain a significant draw. Casual, quality restaurants that strike the right balance of comfort, access, and affordability are well-positioned to succeed.

Overall, these trends underscore the importance of adaptability and customer-centric innovation in the year ahead. Operators will need to remain flexible and adjust strategies to meet evolving demands and economic realities.