The 20/20 on 2020: Restaurant Experts Weigh In
34 Min Read By MRM Staff
Modern Restaurant Management (MRM) magazine asked restaurant industry insiders and experts for their insights on what will impact restaurants in 2020 and the response was overwhelming. They touched on topics such as delivery, ghost (dark) kitchens, automation, plant-based menu items, food waste, sustainability, staffing and retention and more.
Rick Camac, Dean of Restaurant & Hospitality Management at the Institute of Culinary Education
- The biggest trend by far, for now, and going into 2020 is ghost kitchens (AKA delivery only, virtual kitchens, cloud kitchens, pick-up only, etc.). The economic model makes more sense than traditional brick and mortar so many food businesses are moving in this direction. Occupancy cost may be 60-70 percent less than a traditional restaurant and payroll could be 33-50% less. Even cost of sales may go down as the ghost kitchen typically has a smaller, more manageable menu.
- Food Halls – the numbers for current and future growth are substantial. Big and high-end players are getting (and are in) the game. Substantial advantages in marketing, reduced labor costs, shared management costs, lower occupancy cost can be had in this model.
- Low priced / value perceived / big ticket items brought down to a fixed low price. See Sugarfish (inexpensive sushi / omakase) and Burger Lobster as leaders in this sector but many Asian concepts are going in that direction as well. Also, high end chefs (Mark Ladner – Del Posto) doing high-end pasta for under $10.
- A chicken sandwich and the impact it has had on how to market a product – see Popeye’s vs. Chick-fil-A.
FAT Brands Chairman and CEO Andy Wiederhorn
The concept of using an existing restaurant’s kitchen to sell the food from another restaurant or brand has a few names, ghost kitchen, cloud kitchen, virtual kitchen…just to name a few. The utilization of ghost kitchens means more money and opportunity for restaurant operators, without large price or labor hikes. In FAT Brands restaurants in particular, our franchisees who have ghost kitchens see an additional 10-20 percent in sales each week. The increased kitchen space, brand awareness and sales are a no-brainer for brands looking to scale.
Plant-based Menu Items
FAT Brands, Andy Wiederhorn – The proliferation of plant-based proteins in restaurants can’t be ignored. 2019 brought a rapid increase of dairy-free and vegan options for consumers in restaurants including ice cream, cheese, chicken, beef and continued innovations for fish, lamb and milk. These options cater to both vegetarians/vegans and the flexitarian, someone who eats meat but wants plant-based options as well. As menu innovation continues to drive foot traffic into restaurants and increased sales, plant-based food options will continue to be at the forefront of restaurant trends in 2020.
Jim Collins, CEO at Kitchen United
Preference for on-demand food that is accessible anywhere the consumer prefers will continue to increase and force brands to revolutionize. We believe we will continue to see improvements in business models and technology that will advance the delivery experience for target audiences including logistics, restaurants and especially the consumer. We anticipate seeing changes in 2020 as financial markets shift and businesses surrounding the off premise market are forced to streamline. With the consumer showing us what they want, I have no doubt businesses will respond with improved solutions.
Buck Jordan, CEO Miso Robotics
2020 will be a year for significant changes in the restaurant and restaurant technology industry. We can expect to see shifts in industry models that will motivate new investors to flock to the challenges of the industry – with equity crowd funding offering new opportunity to enter the game at the height of transformation. Here’s why:
On-demand explodes past expectations and restaurants scramble
The global food delivery market is expected to grow to 11.4 percent by 2024, and 2020 will be a catalyst year that could drive that number up. Traditional restaurants are already seeing profit losses between eight and 25 percent when using food delivery services such as Uber Eats, we expect more restaurants to prioritize finding solutions that allow them to incorporate delivery methods and meet demand, without losing out on revenue.
Dark kitchens gain more real estate
With more customers leaning on delivery, restaurants look at opportunities to cut space – if you’re not getting the foot traffic, why invest in the space? Enter dark kitchens. 2020 will see investment increases in restaurants that operate without an onsite diner experience.
Forget simple – eaters want more personalized food choices
To increase customer satisfaction, the restaurant model will have to shift to serve customers wanting a basic recipe with new customizable add-ons. Menus need to diversify to keep patrons coming back for more, but more personalized options mean more training for staff. To meet the challenge in 2020, food service providers will start to reimagine recipe automation that keeps taste consistent with optimal speed.
Automation will cause workforce to adjust focus
Turnover of restaurant staff currently sits between 150 to 400 percent and labor costs are incrementally increasing. Millennials, the largest generation in the current workforce, are applying for occupations that deal with software, data or management. In 2020 restaurants will feel the pressure to develop ways to make traditional food service roles more appealing. Robotics and automation might bring new promise for restaurant jobs with a technology development appeal, allowing for a shift in focus to customer experience and greater work fulfillment.
US Foods’ Top Restaurant Trend Predictions
US Foods asked its team of culinary experts, Food Fanatic Chefs, to share the trends they think will be popping up on menus and in restaurants next year.
Mushrooms, Plant Proteins and Fat
Expect restauranteurs to start incorporating more mushrooms and plant-proteins (pea protein, lentils, spirulina) into their dishes as many diners are choosing healthy, meat alternatives. At the same time, there is a resurgence in cooking with fat and even collagen, as chefs look to flavor their recipes with everything from lard to caul fat, which is often featured in sausages, roulades and pates.
“Mushrooms are on track to be the next “heirloom” vegetable in 2020. We’ve seen it before with tomatoes, winter squash, potatoes and onions, but mushrooms have such a rich and lasting history that it’s not surprising customers are finally giving them the attention they deserve.” -Food Fanatic Chef Michael Rhoades
Diner Demands Evolve
Diners will be nostalgic for comfort food like mac & cheese, burgers and pizza, but expect restaurants to elevate and reinvent these dishes by putting their own spin on the classics. Diners tastes are also becoming more global – be on the look out for the integration of international flavors, such as West African cuisine, into everyday dishes.
“The lines of what is American cuisine have become blurred. Executive chefs are adding global flavors to dishes that customers already know and love, such as loaded French fries or tater tots topped with kimchi and roasted pork – it’s a traditional appetizer with a Korean twist.”-Food Fanatic Chef Aaron Gregory
Driving Traffic Drives Creativity
With the rise of delivery and take-out, restaurants will start getting creative with the in-dining experience. Imagine live entertainment featuring the guests themselves (open mic nights, talent shows) or restaurants offering foods and drinks with unexpected flavors and textures, specifically designed to be enjoyed in the restaurant. And levering technology at the table continues to grow, with restaurants using resources such as Toast Go handhelds to speed up service, Resy to help create a more personalized guest experience or a video training platform like ExpandShare to ensure staff are well trained.
“In my market, Little Rock, Arkansas, restaurant owners are hosting specialty nights featuring themed menus with specialty wines, drinks, and other beverages. These nights are often held to promote a cause and raise money for charities. This is a great way to attract all kind of diners, but works especially well with younger, cause-minded diners, like Gen Z.”-Food Fanatic Chef Franklin Dye
Andrew Shearer, Cofounder and CEO at Farmshelf
Minimizing food waste will continue to be a focus in 2020. With consumers placing more importance on using brands that are sustainable, it’s critical for restaurant and food service operators to implement changes that minimize food waste.
Bruce Dean, CEO, Black Bear Diner
Labor issues will continue to bring challenges in 2020, but these challenges will offer restaurants the opportunity for a continued and relentless focus on creating rewarding environments for employees. We’ve also seen off-premise and delivery gain a lot of traction in the last year, however, in the family dining space, providing guests with unmatched hospitality will remain crucial. To that end, while technology and automation will play an increasing role in restaurant operations, we’re focusing on back-of-house technologies that make our employees’ jobs easier so they can focus on our guests.
David Cantu, Cofounder and Chief Customer Officer at HotSchedules, Now Powered by Fourth
In 2020, restaurant technology developments will continue to evolve the industry for the better. The ongoing labor shortage is leaving employers struggling to hire and maintain employees while also being pressured to increase wages. As such, a big focus in 2020 will be on how to find, recruit and keep team members. While new solutions promising to help managers and their teams will continue to roll out, another focus of 2020 will be on consolidating tech solutions. This allows employees to focus more on providing high quality guest experiences as well as help managers foster better employee development for an overall, more gratifying work environment.
GJ Hart, CEO at Torchy’s Tacos
One of the biggest trends I expect to emerge in 2020 is new, creative service models as restaurants continue to compete for both guests and employees. For example, we may see other categories beyond fast casual, quick serve and family dining begin to emerge, such as our company building a new category of “Craft Casual.” This model allows guests to order at the counter and have their food delivered directly to their table; they can order their food via delivery services; they can order in-restaurant and take their food to go; or they can enjoy their food at the bar along with a handcrafted margarita served by a bartender.
In addition, attracting and retaining talent will continue to be a focus. Restaurants will likely continue to offer innovative benefits like free or discounted education, or other programs such as our managing partners program, which allows managers to run their own locations. Finally, while tech and automation certainly dominated headlines this year, I think we’ll begin to see a shift of restaurants using tech strategically to enhance the guest experience, but not at any cost.
Chris Adams, VP of Strategy, Oracle Food and Beverage
- As the food industry becomes commoditized and convenience (delivery, UberEats, ghost kitchens etc.) take hold of the service, restaurants will focus more on the experiential side of dining than the products themselves.
- AI and IoT will enable managers to leverage networks of sensors, streaming video and data analytics to track customer sentiment and respond to guests needs and preferences faster, creating a more personalized guest experience.
- Dark or Virtual Kitchens will greatly increase restaurants’ ability to grow by cutting out two of the biggest operational cost barriers – labor and rent.
Devon Wright, GM, Yelp Restaurant Marketplaces
At Yelp, we're seeing restaurants move away from a strictly reservations planning model. Restaurateurs are valuing a hybrid approach to reservations and running a waitlist to manage their floor and seat more diners, especially during the holiday season. They are recognizing that while reservations are often considered ‘guaranteed’ covers, no-shows and late arrivals keep tables open long enough to seat several more parties and therefore increase their bottom line. We expect this trend to continue, and even pick up steam, in 2020.
ChowNow CEO Chris Webb
Online ordering will continue to have a profound effect on the industry in 2020, but the power dynamics will change. We’re now seeing restaurants and customers push back against the steep fees and awful business practices of massive third-party delivery apps like Grubhub and Postmates. As these big tech players align more with fast food chains and large franchises, independent restaurants will increasingly turn towards software partners that treat them with more respect. Tens of thousands of smaller businesses are already realizing how much power they have, and are working with online ordering providers that put them in control of their finances, data, customer relationships, and brand identities.
Chris Lybeer, CSO at Revel Systems
Lybeer believes that the next year will be pivotal for our industry. A perfect storm is gathering which demands that, to make good on the promise of POS to improve both the customer experience and in-store operations, we must in fact embrace a “less-is-more paradigm."
While it is true that some aspects of POS should and will continue to get more sophisticated, real progress means it should only involve managers when necessary. For example,
it should tell a manager what item to take off the menu to be more profitable. Restaurant managers and employees now spend on average 46 hours/week managing a POS. It should be four.
For the user, the POS experience must get easier and more accessible. We need to make UI and customer interactions smarter, and do the “thinking” for the customer–the system itself should do most of the work. Moreover, he sees technologies like AI and ML (where retail has fallen far behind other industries), as well as voice activation and enterprise-grade functionality and scalability, as crucial to the future.
Ray Reddy, CEO and co-founder of mobile pickup app Ritual
Transparency is key. Restaurants and consumers are becoming increasingly frustrated by the lack of transparency in the industry, particularly as it relates to pricing. We’ve seen third party delivery players charging fees for phone calls that don’t result in food orders, and pricing on third-party pickup apps often appearing higher than what you’d pay ordering directly from the restaurant itself. As a result, trust has been lost. In 2020, we’ll see a lot of emphasis around transparency and recon to rebuild consumer’s trust.
Exclusive agreements are like making a deal with the devil. In 2020 and beyond, it will be increasingly important for restaurants to not rely on one provider. We will start to see a greater connection between ghost kitchens and exclusive agreements between third party delivery and pickup apps and the restaurants they serve. Like Amazon, which began as a third party seller, then moved in to sell their own goods, exclusive agreements and the surge of ghost kitchens is just the start of consolidation in the industry.
Amanda Nichols, senior manager, retail, hospitality, and food service practice at Kronos Incorporated
More and more, we’re seeing the workforce start to expect flexibility from their employer—and it’s not just the younger generations. Of course Gen Z is driving this trend to some extent, but a recent study also found that people looking for temporary work this holiday season wanted a flexible schedule more than any other perk – including high pay.
In 2020, restaurants will have no choice but to respond to that need by reframing the employee experience for their hourly staff and offering up flexible scheduling options. Over the past year, many have talked about implementing flexible scheduling policies and technologies, and some have started down this path – but few have actually completed the transition. We’re looking at a bit of a space-race; those that can be first to execute on this strategy will establish themselves as an employer of choice early on, and develop a reputation as a desired place of employment over their competitors.
Suzanne Cohen, Customer Marketing Manager, Essity Professional Hygiene
Knock-on effects from the growth of e-commerce have impacted the foodservice industry and will continue to do so
With fewer shoppers in brick and mortar retail stores, it translates to a decrease in foot traffic in restaurants. With the loss of foot traffic, restaurants are forced to increase menu prices to compensate.
If the macroeconomic environment deteriorates, it will impact input costs and consumer spending, and restaurant owners and managers will find themselves in an even tougher environment. And for larger chains, the problem is exacerbated because of overexpansion during the bull market.
Urbanization will continue, putting upward pressure on restaurant rents in urban locations as fierce competition for prime locations persists. Combined with limited space for product storage given the need to devote space to front of house activities, restaurant managers will need creative solutions to make their business more efficient.
Off-premise dining is here to stay
Though delivery partners are a middleman, the restaurant brand carries the reputational risks related to the end-customer encounter. Good partnerships and relationships with these services will go a long way to manage the risk restaurants take on from using them.
Because restaurants lose the crucial touchpoint with the end-customer, they should compensate by including memorable branding with the meal to encourage a reorder—things like coupons and branded disposables that end-customers will retain as a result of a positive experience.
Delivery partners allow restaurants to reach a whole new customer segment, maximizing the revenue potential of their business. And in bad weather when foot traffic is typically lower, off-premise dining can help replace this traditionally lost customer base.
Sustainability will be even more important to diners, and restaurants that don’t have a sustainability strategy will be at a competitive disadvantage
We know that consumers associate compostable disposables with a higher level of care in preparing their meal, that the food is better, and feel that through their order they are doing something positive for the world—all positive associations for the restaurant brand for which consumers are willing to pay more.
Sustainability extends into the kitchen with food waste. Demonstrating to customers that preventing food waste is a priority—including through donating to local partners or teaming with a local farmer to compost non-edible food waste—further extends the sustainability halo effect on the restaurant’s brand. Customers will associate dining at a restaurant with these priorities as doing their part to make the world a better place.
Consumers will crave transparency
This means not only supply chain transparency, but also operational transparency. With the launch of Yelp’s LIVES program nationwide, health and hygiene inspection scores are now at diners’ fingertips. Demonstrating and implementing good hygiene practices will be more important than ever—one bad, or even average, report could mean the difference between meeting or exceeding sales goals in a given period.
Experiential dining will reign supreme
It won’t be enough to have good food and good service—diners will actively seek out memorable dining experiences. Instagram-friendly locations and unexpected experiences will draw foot traffic into restaurants. Customization will increase in importance as diners seek out unique dining experiences.
David Bloom, Chief Development Officer of Capriotti’s
- The coming year is going to bring even greater opportunities and challenges in an increasingly competitive environment. The industry is going to continue this fast pace of innovation and disruption related to restaurant products and service offerings, technology adoption and consolidation of service providers. As global travelers, consumers are becoming more sophisticated and driving higher expectations in terms of produces and service offerings, as well as flavor profiles and product innovation.
- Brands that have a significant point of differentiation to lean on and adopt technologies in line with the increase of off-premise sales, that also make the most sense for them, will thrive. Brands and or business models that are unsustainable will retract. That being said, heading into an election year, a lot will depend on consumer sentiment and buying trends. Thedemand for technology capable management teams may become a barrier to growth given the current immigration policies for highly skilled labor.
- The idea that consumers should get exactly what they want, when they want it, is here to stay. In order to keep up with this demand, brands will have to continue to pursue an omni-channel approach to customer acquisition and retention, through a combination of brick-and-mortar stores, as well as a great e-commerce presence. The exception will be brands that offer a unique experience that customers value.
- We are seeing a rise in “flexitarians,” people that like to eat healthy and plant-based at times, but also want to enjoy more traditional proteins.
- We will see some out of the box things like autonomous delivery vehicles and drones, back of the house robotics and AI applications being tested. The advent of 5G will provide the network that will provide the pipeline for all of this data to be delivered and leveraged real time. Integrating all of these new platforms and technologies so that they work together seamlessly will present both a tremendous challenge and opportunity. It will become “table stakes” for companies to adopt and leverage the specific technologies which best suits their brand and business model.
Hungry Howie’s President and CEO Steve Jackson
Economists believe that the country is headed for an economic recession in 2020-2021. During the last recession, brands implemented a variety of tactics to adapt to the change in consumer attitude and behaviors and by meeting those changing needs and fulfilling them in unique ways, several fast-food chains saw an increase in profit margins and were prepared until the market recovers. In 2008, while most pizza brands thrived during the economic downturn, Hungry Howie’s sales were flat. So, our strategy was to reassess our brand positioning and focused on highlighting the core values of the company. Reinventing the company can be a critical strategy for business growth. We remodeled our stores, changed advertising/marketing strategy and invested in technology for the business to be more efficient and effective. With real-time information and live updates, teams can make quicker strategic business decisions. Since then, Hungry Howie’s has grown adding new product, new pizza flavor options, and opening 500 stores.
Restaurant unit growth has been increasing for years, despite lower guest traffic. One way restaurants have been able to offset this is through more LTOS. Whether it’s offering an over-the-top product, dine-in-only BOGOs, or value deal, LTOs effectively create the promise of a short-lived and scare opportunity that creates a sense of urgency among consumers. Restaurants are incorporating them into their marketing plan and finding creative means to boost sales and drive traffic. At Hungry Howie’s, we’ve launched several LTOs from innovative products to deal specials for our value-conscious customers and seen a boost in traffic and drive sales across our stores. Successful LTOs need has unique ingredients, novelty factor, and the right price; and although many customers are expecting it from a variety of chains nowadays, it’s important not to roll out LTOs too frequently as they can also hurt the business’ top and bottom line.
Yogurtland Head of Marketing Jacob Dubin
With an ever-evolving landscape in the industry, being able to adhere to a multitude of consumer demands with limited LTOs has not only helped to increase traffic and sales but also increase brand awareness and support knowing that consumers will be looking to see what’s next on the marketing calendar. Adding a twist to fan-favorite flavors can help bring an emotional tie to the consumer which can then drive consumers and outside audiences as an ultimate destination aside from the competition.
At Yogurtland, we’re continuing to find new ways to bring excitement to our rotating flavor lineup and product offerings, and 2020 will be our biggest year yet. From frozen yogurt fans, ice-cream lovers, on-the-go shake sippers and plant-based eaters, we have new unique flavors and platforms planned to please a spectrum of customers and ideally the entire family. Next year we’re focused on elevating the customer experience through more ways to build your own customizable creation so consumers can play an active role in the decision process.
Flame Broiler Marketing Manager Daniel Lee
As the fast-casual industry is a place that according to CNBC loses up to 130% – 150% of employees every year, keeping up with the demand of hiring good, quality employees is of the utmost importance. Using recruiting platforms such as ClearFit or Sentio enables franchisees to sift through the endless applications they receive so that they can actually hire the right people for their locations and build lasting relationships with their future employees. While Flame Broiler hasn’t implemented a recruiting platform as of yet, we are sure that this tool will become widely popular in 2020.
Apps such as Ready to Pay are currently being utilized in sit-down establishments to help diners split checks straight from their tables, in the same way, I believe that similar technology will be used in the fast-casual space by providing customers with a QR code scan that can be used within restaurants to enable diners to bring the menu up on their phones and skip queues.
Dan O’Connell, CEO of Foodmix Marketing Communications
Plant-Based Food’s Clean Label Problem
Food companies have been cleaning up their labels for years. And right on the heels of that reformulating comes plant-based everything. Just because something is plant-based, will consumers be mollified into accepting a bunch of weird-sounding ingredients they’ve never heard of? We don’t think so. Educated consumers are beginning to question the large number of ingredients required to give plants that non-plant taste. If it takes 27 ingredients to make your plant-based whatever, shipped by 27 trucking firms from the same number of food companies, well, that label won’t be clean and that product won’t necessarily be more sustainable than the non-plant version it’s replacing. We predict plant-based food’s environmental sheen and health halo will wear thin in 2020.
OMG, that dessert is so TikTokable
TikTok, the fastest growing social media platform of 2019 and newest favorite among Gen Z, has already made huge inroads for wannabe celebrities and amateur “dancers” and will now take off as a visual romancer of all things food. A mobile app designed to create and share short videos, TikTok’s format will increasingly attract marketers’ paid media budgets and inspire quick food clips by aspiring culinary gurus. It will be used by restaurants to showcase the back-of-house theater of making creative dishes and, of course, by consumers to show off the OMG-yumminess of each bite of that coconut pandan crème brulee.
Shaken, Not Stirred…and Hold the Alcohol
Younger generations of drinkers are discovering that drinking to get drunk is not particularly healthy and makes them unproductive the next day (thanks, hangovers). Yet, Millennials, designated drivers, pregnant women, and others who abstain from alcohol still want to have fun and not be the party buzzkill. Luckily, bars and brands have been paying attention to this new trend. Instead of offering traditional alcohol-free drinks, there is a call for more sophisticated and tasty drinks sans alcohol. In 2020 more beverage companies will cash in on this opportunity (like Heineken has already done with zero-alcohol beer). And mixologists are embracing the art of creating mixed drinks that creatively utilize produce, simple syrups and unexpected ingredients to give mocktails a cocktail flair. So cheers, to staying sober!
Hyper-Personalized Products For Today’s “Look at Me” Society
Today’s marketers will tap the growing number of today’s media touchpoints and combine behavioral and real-time data to tailor services, and even products, to each consumer. Along with traditional hyper-personalization tools like algorithmic “you may like” options, hyper-personalization will be used more and more as a compelling marketing technique. Matching flavors to personalities, creating hyper-personalized recipes that can be shared on social media, individualized latte art and personalized packaging will meet today’s demands for both a sense of individuality, along with a totally epic opportunity to “go viral.”
CBD Gets Contained
The new frontier will either be closed or dramatically reigned in. The federal government will provide clarity to how and if CBD can be used as a food ingredient on a national level – or at least lay out a specific timeline to contain what is now a regional business with little oversight. If all this uncertainty makes you anxious, try sucking on a few CBD gummy bears to ease your nerves.
Gott’s celebrated its 20th anniversary this year and here's what executives see on the horizon and how they're responding as a company.
Clay Walker, President, Gott's Roadside says, “Consumer demand for plant-based protein continues to increase, evidenced by our growing impossible burger sales. We have also sold more salads and vegetarian items (brussels sprouts, corn, cauliflower) than ever before. Culinary director, Jennifer Rebman, is currently working on other veggie-friendly dishes. Our goal at Gott’s has always been to ensure there is something on the menu for everyone.” Jennifer adds, "Gott’s already has a lot of meatless items available, and I continue to explore vegetable-focused sharable sides and am currently testing vegetarian tacos for our menu this spring.”
In 2017, Gott’s was one of the first fast casual restaurants nationwide to incorporate the Impossible Burger into its menu—and keep it there. It is now one of Gott’s most popular offerings.
“Fried chicken sandwiches are all the rage. Popeye’s and Chick-fil-a are grabbing the headlines, but many restaurants are responding to this trend in their own way," says Clay. Gott's recently launched a Middle-Eastern inspired Chicken Schnitzel sandwich that is off the charts.”
Jennifers adds, “Chicken sandwiches will continue to rise in popularity. Our new Chicken Schnitzel did incredibly well during its two-month specials run, so we are adding it to the permanent menu. We also have a crispy teriyaki chicken sandwich on our menu that has seen a boost in sales with the increased popularity of chicken sandwiches."
“The popularity of hard seltzer cannot be ignored. At Gott’s, we are adding White Claw to our menu this month.”
Culinary director Jennifer Rebman says, “I think Israeli/Mediterranean cuisine will continue to be popular into 2020. Our new Chicken Schnitzel sandwich is heavily influenced by foods of Israel. It’s rubbed with cumin and turmeric before being fried crisp and topped with pickled turnips, freshly picked mint, dill and parsley, sliced cucumbers and arugula. We sauce it with harissa and turmeric-spiced mayos."
Saleem Khatri, CEO of mobile POS, Lavu
As we head into 2020, Point of Sale (POS), back of the house software and payment processing are becoming tightly integrated. What makes customers happy makes restaurants succeed. Said another way, restaurant operators are looking for a one-stop restaurant management platform to meet all their needs. In order to truly streamline operations and maximize efficiency, restaurants will need POS systems that are increasingly holistic. This means the ability to handle payments, process orders, send tickets to the kitchen, provide detailed reporting, and offer inventory management. In the 2020s, stand-alone POS systems and payment processors will fade away as restaurant platforms grow.
Desi Saran, CEO and Founder of Sweetberry
When it comes to restaurant trends, there’s a growing demand for immediacy and convenience. Today’s consumerwants flexibility when it comes to ordering, receiving and consuming their meals, as well as access to multiple menus options at once.As a result, deliveries are increasing, and many restaurants are shifting to cater to this trend.
The shift has helped birth kitchen-only models known as “ghost kitchens” or “virtual kitchens,” which were created solely for the purpose of fulfilling multiple online orders quickly and easily – usually through aggregators such as Uber Eats and Door Dash, or through in-house delivery drivers. With this model, customers typically do not enter the space and can only order for delivery. Thus, the operator can focus on fulfilling delivery tickets.
A ghost kitchen operator may house anywhere from one, to 10 or more restaurant brands in one space. Multiple brands allows for multiple listings across different delivery aggregators, increasing overall sales.
Ghost kitchens have been attracting both big brands and investors, and I believe this will continue to grow in 2020.
Nick Herntier, Pizza Man owner/operator
For some tech trends, I think you're going to be seeing everyone going towards taking orders at your table via tablet or phone. If you haven't already seen that, it's a big deal. It's instant order input for the servers, and fewer mistakes made because you don't have to remember an order and transfer it to a POS station. Also, I'm sure we'll see a LOT more credit card terminals via tablet or cell phone AT tables. People don't want to have their credit card go out of sight and into the BOH where people are doing god knows what with it. I have a feeling that PCI compliance and laws will eventually not allow your credit card to leave the table eventually. These 2 changes will force restaurants to go with a POS system (if they don't already have one). More specifically all POS systems will need to update and have integration for said changes.
As far as employee trends, the restaurant industry always sees high turnover and employees who typically "don't care". Especially now with unemployment being so low, restaurants really need to cater to the employee. I'm predicting that a lot of restaurants go with more "standard" practices, such as providing health benefits, 401k, and even profit sharing.
Will Eadie, Global VP of Sales and Alliances, WorkJam
As we head into 2020, restaurants, if they haven’t already, will have to begin seriously considering the impact food delivery businesses have on their brand. With third-party brands now facilitating the relationship between restaurants and consumers, restaurants must do everything in their power to control that customer experience. An example of this could include rethinking how the kitchen is trained and staffed.
We will definitely see restaurants change staffing levels and the rise of ghost kitchens, to ensure order fulfillment is efficient and timely. Further, kitchen staff will have to refine preparing and styling to-go orders to present well after transit. Additionally, staff will be expected to have cross-training in both order fulfillment and customer service for guests dining-in. With possibly fewer chances to win over in-house diners, it’s imperative that restaurants capitalize on their waitstaff and make both the dining-in customer experience count.
What are potential solutions for issues that plague the restaurant industry such as staffing and retention?
It’s critical that restaurants prepare their staffing and operations with digital workplace tools to meet the demands of what this shift in the restaurant industry will bring. Through predictive scheduling, online training modules, and closed-loop communication, restaurants will be able to staff locations accordingly and ensure efficient service while reducing turnover and creating a more loyal, higher-performing workforce. Additionally, using a digital system to manage tasks will allow for compliance around execution and food safety.
Mariel Street, Owner and Co-Founder of Liberty Burger
Meatless Beef and Poultry Alternatives
The core of so many American meals—meat—will continue to see disruption as new plant-based “meats” enter the market. Instead of burgers getting the spotlight with Impossible and Beyond, I predict we will see other meats like whole muscle cuts and poultry. Tyson is almost there with their new chicken nuggets, but I think we will see a lot more develop through 2020.
Consumers will no longer just focus onwhere food comes from— which farms, for example—but also how the food is harvested. Things like sustainable and regenerative farming will become more mainstream as consumers continue to search for food and meals that not only taste good, but also feel good too.
Marco Street, Owner of Street’s Fine Chicken
More Creativity Between the Bread
The battle between Chick-fil-A and Popeyes turned a lot of attention away from chicken tenders and onto creating more wild and unique chicken sandwiches that we will see a lot more of in 2020.
Chicken with a Kick
Spicy will never go out of style with chicken—surprisingly, the Nashville style has not made a huge presence on menus beyond singular specialty items. In 2020, we’ll see new versions of the spiced-up, oil preparation that keeps chicken spicy, fresh and interesting, many with Asian and South Asian influences.
Ken Kim, Owner and Founder of Kotta Sushi Lounge
Plant-based Japanese Food
Vegan and vegetarian food continues to gain market space when it comes to overall revenues in restaurants. In 2020, we anticipate seeing more vegan friendly ingredients that mimic a non-vegan item in both sushi rolls and entrées. Items like Tomato” Tuna” and Oyster Mushroom “scallops” are expected to become more popular among non-vegans as well.
Lesser-known Authentic Cuisine
Millennial diners have fallen in love with sushi, but they are becoming more interested in trying the lesser-known, authentic Japanese food items like Okonomiyaki, Cold Soba Noodle and Gyudon. Guests are looking to truly embrace new foods and are more open to trying new flavors than ever before.
Placer.ai made five predictions for the biggest trends to expect in 2020’s retail and commercial success. Utilizing their insightful foot traffic data, Placer.ai looks to the past to inform the future and foresees a rise in megaprojects, more store closures, new forms of retail, a continuation of the chicken wars success, and stores maximizing their physical footprints.
The Rise of the Megaproject
Recent megaprojects’ immediate impact goes far beyond the single project. From Hudson Yards to Essex Crossing to the Boston Seaport, these massive developments drive traffic from locals to tourists and their buzz keeps getting louder. Placer.ai expects 2020 to bring about a variety of new projects and openings to recreate this magic across the country.
Store Closures – Retail Apocalypse Vs. Correction
When major retailers shutter a location, many conclude that the “retail apocalypse” claimed its latest victim. Yet, Placer.ai’s data shows that not all store closures are equal. While stores like Sears and Kmart are struggling, Walmart discovered their superstores were cannibalizing each other and found strategic closings optimized efficiency.
Nic(h)e & New – Filling the Retail Vacuum
As 2019 witnessed over 9,000 retail locations closing, Placer.ai found a rising number of product-oriented companies focusing on expanding their branded retail footprint and they expect it to continue. Stores like Nike, Puma, Lululemon, and Levis are all focusing on their relationships with consumers and using brick and mortar to strengthen online sales.
Kings of QSR – Chicken, ‘Holidays’, and Veganism
Placer.ai predicts the wider QSR sector could be in for a banner year in 2020. Although the Fast Casual sector may be suffering, Placer.ai’s data shows this is not the case across the entire QSR space. The Chicken Wars for Popeyes and Chick-fil-A’s led to stratospheric success with foot traffic spikes just under 300% above baseline.
Placer.ai is also keeping an eye on Starbucks as a brand that has leveraged interesting offers to create demand in periods of lesser brand affinity. From a Tie-Dye Frappuccino to Pumpkin Spice Lattes, Starbucks has shown a mastery of finding the right mix of gimmick and value to own the calendar in a way many companies could only dream of.
Maximized Retail Footprints
Placer.ai’s final key trend is maximized retail footprints. Earlier this year, both Wendy’s and Panera announced moves to expand their menus to more effectively tackle areas that weren’t within their current core strengths. Following McDonald’s lead, they found a way to improve the value created off of these fixed costs.
Another example of this is the experiential retail pushes being led by brands like Lululemon and CVS. The former opened a Chicago location that provides space for classes and a restaurant for a post-workout recharge resulting in much higher off-peak traffic. The same concept drove a powerful idea for CVS’s Health Hubs. Placer.ai data showed that visits were lasting longer and taking place during periods that didn’t align with the national average. This means CVS was driving more visits and driving them during off-peak hours.
Placer.ai believes 2020 will serve as a critical stage in this transformation that will allow the sectors’ new giants to emerge and establish the defining approaches to success in the new decade.
YT Liang, senior product manager, ATEN Technology, Inc.
With so many sports events throughout the year and the upcoming 2020 Olympics, restaurant will be looking for ways to provide their guests with the best quality and experience of the sports playing on TV while keeping the added expense within their budget. Two types of solutions can easily help solve restaurant owners’ headaches. The first solution is reducing the quantities of monthly subscribed cable boxes, leading to less monthly expense. Also utilizing video distribution with either a video matrix or over IP extenders. A must-have feature will be 4K video with HDCP 2.2 support. The second solution is reducing difficulties for the bar tender or server when switching various TVs to different channels on different displays by utilizing a control system which will allow them to only need to push buttons on an iPad or Android tablet. With that, they can easily control all of the devices, saving the hazzle of finding and using a remote controller.”
Eddie Hall, business development director and food safety expert at Vital Vio
Food safety will focus on the supply chain
Bacteria growth prevention is crucial along the supply chain, considering the opportunities for contact from the farm to last-mile delivery. In 2020, each point of the supply chain will see an uptick bacteria-killing technology – from the farm, to the transportation truck, to the kitchen and restaurant. Most transportation truck fleets are embedded with cooling technology designed to keep food fresh. While most harmful bacteria grows in warm, moist environments, fungi can grow and thrive in the cool as well. Additionally, while it’s critical Zones 1 & 2 are spot-clean, Zones 3 & 4 should not be forgotten. Each day, we come into contact with 60,000 different types of bacteria from using the restroom, touching our phones and using public transportation. Unfortunately, it’s likely that employees are then bringing bacteria into the break rooms, hallways, etc.
Grocery store upgrades
According to the USDA, bacteria grows most rapidly in the ‘Danger Zone’, which is in the range of temperatures between 40°F and 140°F. Our grocery stores are typically 68°F, providing an ideal breeding ground for bacteria. In 2020, grocery stores are expected to implement bacteria-killing technology throughout stores to ensure healthy, safe and clean food..
Many believe that the increase in smart automation products reduces the need for a human workforce. However, automation is meant to enhance human work; not replace. Restaurants and other food venues will see an increase in automation considering foodborne illnesses contribute to the one in six Americans getting sick and 3,000 deaths annually. It is important for automated systems to take on – and enhance – tedious tasks such as constant cleaning and sterilizing.
Less food recalls
The U.S. government is stepping in with new regulations, such as the Food Safety Modernization Act (FSMA), that urge companies to shift from reactively responding to safety issues, to proactively working to prevent them. Not only will food & beverage vendors be expected to implement more sanitization technologies, but also focusing on other ways their company can prevent food recalls and bacteria growth.
Kevin Sennett, American Dining Creations Corporate Executive Chef of Research and Development
In 2020, attracting Gen Z guests will be essential. Considering the group tends to get the reputation of having a short attention span, we anticipate the industry might struggle in maintaining their interest. One way to do this would be to utilize foodie influencers to attract Gen Z.
When it comes to targeting Gen Z, skip the traditional methods of advertisement. We all know Gen Z craves authenticity, and one of the most wholesome endorsements is from a trusted source. Making relationships with foodie influencers is essential in gaining the Gen Z stamp of approval. Influencers are socially savvy and know the right captions and hashtags to use to reel in the likes.
Craig Dunaway, president of Penn Station East Coast Subs
As third party delivery services continue to gain a foothold with consumers’ ever-increasing desire for greater speed and more convenience, ongoing pressures with the off-site consumption of products will grow and put further strains on a depleting workforce. All the while, brands are struggling with quality issues associated with third party delivery, the exorbitant fees being assessed to them, and the push back from consumers with driver issues they can't control. The restaurant industry sales are down (or flat at best), and all the while, delivery has grown to a $15 billion a year industry. Thus, concepts are competing not only with other brands, but with themselves. Rather than rush into a hasty decision with third party delivery, it might be more prudent for brands to sit patiently on the sideline, not ignoring something that continues to grow, but rather studying what is working and not working and taking advantage of the key learnings with others’ time and capital.
John Kelly, CEO, Zenreach
Investments in restaurant technology will continue to grow. New technologies enable restaurant owners to understand their customers better. For example, there are cloud-based POS systems that collect emails for receipts, customer loyalty programs, and guest WiFi technologies. As more and more restaurants start to use these kinds of systems, efficacy will also improve.
Data ownership issues come hand–in-hand with these new technologies. As you collect more consumer data, you have to be careful to protect it. Most restaurateurs are not well-versed on how to do this but will need to do so as CCPA and other legislative initiatives come online. In addition, restaurant owners will face the challenge of collecting these customer data points into a unified view of the customer. Collecting data from POS is great but if it does not tie to your loyalty program or your guest WiFi experience, it will only give you a partial view.
Restaurant owners will have to look to technologies and partners that can provide both customer data protections as well as the ability to unify various data sets into one customer view. One example is what we are doing at Zenreach where we can collect POS, loyalty and WiFi usage to provide a 360 degree view of the customer.
Jonathan Duarte of GoJobs
One of the biggest factors facing all hospitality and restaurants is hiring and recruiting. With today's unemployment at record lows, job seekers have the advantage. Nearly every restaurant is hiring, making it difficult to not only hire, but retain top talent. To compete for top talent, hiring managers need to make it easy, and fast, for candidates to apply.
In the US, text messaging is starting to give hiring managers a competitive advantage. Text messaging is the "Channel of Choice". Restaurants, from large franchisors to mom-and-pops are implementing "Apply by Text" type of solutions, where a job seeker could text the term "jobs" to either a local texting number or a shortcode, and then proceed through an automated, text-based job application.
Texting makes it easy for the job seeker, and hiring manager, because most responses are sent instantly, and responded to quickly, making it for hiring managers to "screen" candidates, prior to inviting them in for an onsite interview.
Oklahoma State University Beverage Director Tony Collins
People of all ages (not just millennials) are drinking less for a variety of reasons, the primary reason being that most people are trying to lead healthier lives these days. Restaurant beverage programs across the board will be effected by this trend sooner or later and will need to adapt in order to stay relevant and profitable. The good news is that more people are willing to spend top dollar for a well-made cocktail, a craft beer, or a glass of wine than ever before. Successful beverage programs in the future should focus on selling higher-end quality and move away from value-based quantity, In other words, learn how to make and sell a delicious $15 Manhattan rather than hope to sell two sub-par $10 Manhattans made with inferior ingredients by a poorly trained bartender. If you’re good at what you do, you can make the same amount of money using the former approach as you can the latter. Nothing wrong with that.
Ralph Dangelmaier CEO of BlueSnap
A key trend driving restaurant innovation today is modern diners’ desire to free themselves from being attached to the point-of-sale. To meet their expectations – and stay competitive – restaurants must provide self-service tools that allow customers to order when they want, pay how they want and redeem loyalty perks in real-time without having to manage 30 different restaurant apps or flag down a server.
Many small and medium restaurant owners assume these mobile wallet resources aren’t accessible to them, but you don’t have to be an enterprise-level restaurant like Starbucks or Dunkin’ Donuts to have these capabilities. I encourage all restaurant owners to seek out a third-party who can help them ‘surprise and delight’ their customers while owning their data.” – Ralph Dangelmaier, CEO, BlueSnap
Mark Bunney, Director of Go-To-Market Strategy, Ingenico Group
Customers are demanding convenience and that will eat into restaurant profits if restaurants don’t act fast. Americans love going out to eat, but hyper-connectivity and busy lifestyles continue to influence consumer behavior and will impact how and where society eats. Fast food options and food delivery startups are growing rapidly and fast food growth has outpaced that of bars and restaurants by a nearly 7:1 margin for 2017-2019. The restaurants leading the charge are leaning into the convenience factor and implementing new technologies to speed up and enhance the customer experience. Pay-at-the-table technology, contactless and cashless payment options, and offering new and different mobility options should all be key focus areas for restaurants in 2020 and beyond.”
Roslyn Stone, MPH, Chief Operating Officer, Zero Hour Health
Trend 1: Delivery And The New Risks
Delivery, and more specifically food safety for delivery, is clearly very significant industry issue for 2020.
Just one example: the L.A. County Board of Supervisors is considering regulations to require sealed food delivery bags after a local news story showed delivery drivers reaching into bags. The next critical issue will be food remaining in the danger zone (between 40 degrees F and 140 degrees F) for long periods. This really hasn’t been addressed by the foodservice OR delivery tech industries at all.
It’s clear that developing excellent operational practices for delivery will positively impact customer satisfaction and also ensure best practices for food safety are followed.
Trend 2: Ghost/Cloud Kitchens and How They Put Your Brand At Risk
As the ghost (or cloud) kitchen industry explodes and more businesses prepare food in third party locations, serious aspects of food safety and employee health are essentially getting outsourced. With Uber’s planned multi-hundred million dollar investment in this industry, expect to see explosive growth here.
Figuring out how to maintain food safety in these kitchens is going to be critical for protecting your customers and your brand. No customer will ever understand or care that an outbreak was actually your third party kitchen vendor’s fault.
Trend 3: The Hepatitis Outbreak
The Hepatitis A outbreak that started in 2018 and heavily impacted restaurants in Kentucky, West Virginia, Ohio, Michigan, and Indiana continues to be a significant issue for the industry. A single hep A case is devastating – revenue drops an average of 50% in the first week after a case goes public and is still down by 7% or more a year later. While there were 3,366 cases of Hep A nationally in 2016, Florida alone will have more than that in 2019, with this trend largely driven by the opioid crisis
Although Hep A can be transmitted by food handling, that is really very rare, and in most instances there is no clinical reason to go public. Even the CDC supports changes in how local health departments handle Hep A cases in food service workers. However, until that change occurs, the industry needs to focus on Hep A prevention through handwashing, strategic vaccinations and making sure employees don’t work sick.
Matthew S. Hollis, Co-founder and President of Elytus
Food waste will continue to be one of the key target areas for improvement in 2020. As pending legislation continues to come to the table, restaurant leaders will likely be required by law to prioritize food waste reduction. Keeping plugged into your local waste management policies will ensure you’re prepared and not caught off guard as these changes move forward.
Levi Olmstead, Director of Marketing for 2ndKitchen
2020 will be the year the entire restaurant industry jumps on the tech train. Up to this point, only the early adopters have really leaned all the way in and have seen the benefits. Expect restaurants to leap into the 21st century with new websites, online ordering experiences, and other ways to leverage the B2B tech boom to help increase their bottom line.
Key 2020 Employer/Hourly Workforce Trends from Bluecrew
Automation and Upskilling
Despite all the chatter about automation eliminating jobs, e-commerce growth is sure to drive demand for more warehouse and delivery workers. As employers continue to invest heavily in automation technology, opportunities for upskilling will only increase. This is especially good news for hourly workers hungry for career advancement. Smart employers will continue to emphasize upskilling and career growth opportunities as a key strategy for recruiting and retaining their hourly workforce.
Data from Bluecrew and other industry reports clearly indicate hourly workers favor flexibility above all other aspects of the job including pay and perks. A Bluecrew analysis of more than 10,000 job offer rejections found that a quarter (26 percent) of jobs were rejected due to the hours compared to 10% of jobs that were rejected due to pay. Employers increasingly recognize that in a tight labor market, offering flexibility around scheduling and hours is another strategic way to attract and retain workers without increasing wages or negatively impacting the bottom line. More employers will adopt staffing technologies and platforms such as Bluecrew to seamlessly provide the flexibility hourly workers want.
The cat and mouse game will continue between regulators and gig companies. As lawmakers try to define and clarify existing worker classification rules that ensure worker protections like workers’ compensation, overtime, minimum wage, and sick pay, gig companies will continue to fight back and invest in ways to avoid providing worker protections by classifying drivers and other workers as independent contractors.
Backlash Against AI and ML in Hiring is Over
More employers will adopt or at least test out machine learning (ML) and artificial intelligence (AI) to enhance hiring strategies in 2020. By focusing on objective job performance data of employees and eliminating inherent biases such as appearance, employers will find more reliable, higher-performing workers and will be able to staff-up significantly faster.
Worker Organizations and Union Membership
As the popular backlash builds against income inequality and declining worker benefits and protections, private-sector, non-union worker organizations will continue to emerge to advocate for fair pay and labor protections among various groups including teachers, retail workers, drivers, etc. Traditional union membership will also grow for the first time in decades.
Fabiana Meléndez, publicist at Zilker Media
Restaurants will need to develop strategies for reaching consumers at different life stages
Millennials will come onto their own as one of the biggest consumers of restaurants as they become parents — pricing will be their biggest focus in the coming years. Gen Z, on the other hand, may focus on as innovative menus and experiential atmospheres. Marketing managers will need to amp up their outreach strategy in order to better reach both sets of consumers such as highlighting why the price point is worth the experience.
Health consciousness will continue as it moves from trend to lifestyle
Restaurants saw a number of food trends move in during the last decade including gluten free, keto, paleo and more. As consumers focus on health and wellness, many will be willing to pay a bit more for healthier options. Restaurants will need to move away from gimmicky marketing and make changes that will actually offer wellness options. This can include: seasonal menus, comprehensive vegan options and more.
Radu Balas, marketing VP for Aur’a Water USA
One of the biggest issues the restaurant industry will have to address in 2020 is transparency. Consumers have already started to demand total transparency not only on product sourcing. They also want complete details about the products consumed and how these products will affect their health.
With more and more people trying to actively manage their wellbeing through healthy food choices, restaurants will now have to focus on delivering healthier products to the table. As a result, one of the biggest restaurant industry trends in 2020 will be a swift of focus from traditional products and foods to healthier choices, such as gluten-free foods, healthier drinks – including natural alkaline water – and general adherence of the business to sustainable practices.