04 March 2020

American restaurants are "on life support"

Excerpts from a long article at The Counter:
The restaurant industry is in a scary place, one that fairly guarantees heartbreak. Restaurant traffic was “flat” at the end of 2019 and “sluggish” the year before that, according to The NPD Group, a research firm that tracks how often we spend money at five types of businesses: fine dining, midscale, casual dining, retail, and, the biggest category, with 62 percent of the pie, quick-service restaurants (QSRs). Quick-service and retail qualified as “relative bright spots,” according to NPD, and casual places managed not to endure a fifth straight year of losses. But full-service restaurants dragged everything down: “Visit declines in the full-service restaurant segment continue to prevent the industry from growing.”..

Chefs and restaurateurs on both coasts take a dim view of the future, not because of the numbers but because of their own experience, going to work and talking to their peers: Too many restaurants open and then close too fast, after months, not years. And closures are an equal-opportunity phenomenon, nationwide. If you live someplace that grows or raises the food these city chefs sell, you might want to make sure your local Applebee’s is still open before you pile the family in the car and head over—the chain just announced a new growth strategy, but it centers on catering and delivery, not restaurants...

Experienced restaurateurs say it’s a paradigm shift—new people, new sources of money, new expectations, most of them unrealistic, and a new generation of diners who don’t consider seats and service a priority. As more businesses look for more ways to feed us, today’s definition of “restaurant” may take its place on the shelf right next to the typewriter.
Restaurants are an at-risk population even in more stable times, in part because their owners embody the American ethos of the independent, can-do spirit, which means they have no safety net. The National Restaurant Association (NRA) says that 70 percent of America’s restaurants are owned by individuals, not operating companies or venture capitalists—people who don’t have the kind of deep pockets a bigger company might...

Venture capital is throwing money at the end of restaurants. CloudKitchens, a start-up from ex-Uber CEO Travis Kalanick, has received $400 million from Saudi Arabia’s sovereign-wealth fund, according to The New York Times. Reef Technology, a Miami start-up, has funding from SoftBank, the Tokyo-based multinational whose previous, oft-troubled investments include Uber and WeWork. And Kitopi (short for Kitchen Operation Innovation), based in Dubai and New York City, is about to spend $60 million to expand its U.S. business.

The money’s for ghost kitchens, volume operations designed to cook and deliver multiple cuisines from a single, massive kitchen. The latest iteration, from Kitopi, is the ghost kitchen as remote franchise, contracting with a brick-and-mortar restaurant to make and deliver its dishes. Whatever the model, big money is banking on a stay-at-home future. The old-school argument about who wants what for dinner will be resolved by a driver who pulls up to your home with one Chinese meal, one Italian, one vegan, and one hot-chicken plate...

As our homes turn into sophisticated entertainment centers, the old notion of a sad sack slumped on the couch with cold pizza (offspring of the sad sack slumped on the couch with a foil-wrapped TV dinner) has given way to a new reality. We can order a great meal from a favorite restaurant via a delivery service, or from meal suppliers that didn’t exist 10 years ago—or did, but have since upped the quality of what they sell...

Portable food appeals, in our multi-tasking culture, because linear behavior—I drive, I park, I order, I eat, and then I go home to my landline phone—has been replaced by a polyphasic model. Nobody’s sorry to eat and run anymore, but rather, proud of it...

“The rise of ‘placeless’ restaurants,” the report notes, referring to every variation on the ghost kitchen model, “will challenge and redefine the concept of what a restaurant is.” Get ready for restaurants without borders...

If this were a conversation about a landmark building, futurists would complain about empty nostalgia, while preservationists stressed the importance of protecting our history. Since it’s about endangered restaurants, futurists point out that face-to-face interaction is merely one of myriad ways people connect, and we can and should embrace great food wherever it is, while preservationists talk about the civilizing nature of a meal taken with friends and family, possibly without cellphones, away from the distractions of daily life. 

It’s democracy in action. Or it’s the end of the world as we know it. Too soon to tell.
Lots more details and discussion at this well written article.  Via Neatorama.


  1. Perhaps existing restaurants should adapt to the times, and offer things the younger generation wants. More vegetarian, or at least meat-light dishes. Be in a walkable or bikable surrounding instead of in a strip mall next to a highway. Stop thinking in "restaurant concepts" that all look and feel alike and come back with menus that are actually unique, not just silly variations of the same old dishes (I'm looking at you sriracha burger with avocado slices). And finally, STOP PUTTING ARUGULA ON PIZZA!

    Also, realize that there is only a need for a finite number of restaurants. The industry can not grow faster than the US population.

  2. I know what will fix the problem ... let's raise the minimum wage!

  3. I don't eat out anymore because of all the crap ingredients. Most restaurants use blends of soy, corn or canola oils. I only use avocado, coconut, or olive oils. Let's not even get into the quality of the meats and eggs... The American food supply is a nightmare, and the only way to control what goes into my body is to buy (or grow) individual ingredients that meet my standards.


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