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Embrace the “new normal”: My takeaways from 2023’s Restaurant Finance & Development Conference

Steven Cook of Force4Good at the Restaurant Finance & Development conference.

Does anyone talk about the “post-conference glow”? I’m feeling energized after the Restaurant Finance & Development Conference last week at the Bellagio in Las Vegas. The Neon City was buzzing with even more excitement last week in anticipation of the upcoming F1 Grand Prix (spoiler alert: Verstappen won again), and the conference felt it, too.

If you weren’t able to attend, I took copious notes and included my key takeaways below from this year’s RFDC.

General restaurant trends and statistics:

  • Overall, customer spending is roughly the same as it was pre-pandemic, but more focused in suburban areas and less in city centers.
    • Spending is permanently down 8% in city centers (read: people moved to suburbs!). 
  • Long term increases: From 2005 to 2023, customer spending on groceries for food decreased from 55% to 45%, while spending at restaurants increased from 45% to 55%.
  • On average, menu pricing goes up 2.9% per year, on average. In 2023, it’s up 7.7%.
  • Eatertainment concepts are all the rage – think Topgolf or Dave & Busters. As a whole, golfing is up 60% versus pre-pandemic.
  • Small coffee shops are also on the rise. Of 50,000 US coffee shops, about 3,000 of these are these small footprint coffee concepts, and growing.
  • Digital is stronger than ever – over 80% of Domino’s and Papa John’s sales are digital.

Survey says… opportunities abound! 

Lisa Miller, of Lisa W Miller & Associates, conducted a recent survey and presented her findings at the RFDC. She found that:

  • Only 31% of diners think their last restaurant meal was “worth it”.
  • What would make a meal “worth it”? For both Quick Service and Full Service restaurants, customers’ top answers were “affordable pricing for quality meals” and “consistent food quality and taste”. 
  • 70% of respondents say “it’s too expensive to have fun”. Customers are concerned about spending due to inflation and mental health/wellness.
  • On average, meals cost 20-30% more compared to pre-pandemic prices. Roughly 50% of guests experience sticker shock (52% in QSR, 47% in full service).
  • Guests are more frustrated with restaurants now than in January of 2023. 30% of guests say service took longer than expected; 23% said there was a lack of cleanliness.

Big thoughts:

Below are quotes and key points from several RFDC speakers.

  • Sharon Zackfia, William Blair: “If you take the ‘Fast’ out of ‘Fast Casual’, you get ‘Casual’, which is not what customers want.”
  • Jerry Rice, Hall of Fame NFL receiver: “If you look good, you’re gonna play well. Appearance is important.”
  • Brett Schulman, CAVA Co-Founder and CEO: Technology is to enhance the human experience, not replace it.
  • Andrew Smith, Savory Fund: Control your controllables (what you can control) whether the economic climate is good or bad.
  • Patrick Doyle, Executive Chairman at Restaurant Brands International and former CEO of Domino’s: 80% of Canadians have eaten at a Tim Hortons within the last 30 days.
  • Nicholas Bloom, Professor of Economics at Stanford University: Nicholas advocates for hybrid work-from-home employee arrangements, finding that hybrid WFH arrangements lowered employee quit rates by 35%, while having no change to their productivity.

From Lisa Miller’s revealing survey insights on customer perceptions to the profound wisdom shared by industry leaders, it’s evident that adaptability, affordability, and a commitment to enhancing the customer experience are more crucial than ever in navigating the challenges as well as seizing the potential that lies ahead of us. Thanks to the RFDC team and the Bellagio for a wonderful conference! I had a great time and hope to attend again in 2024.

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