I predict that the restaurant industry will have an incredible year in 2011. Even with commodity prices moving up a bit, more competition from grocery stores and “designer” C-stores and those pesky systemic issues that never seem to go away like – unionization, minimum wage, healthcare, menu labeling, immigration, employee turnover and a scarcity of growth capital. This is baggage and just part of the deal. What I see has changed is attitude and a growing willingness, by all stakeholders in this industry, to work together. This is what is called business partner optimization. We have new ways to communicate, collaborate, promote and engage now and combined, are likely to change our industry forever.
What I’m hearing from chain and independent operators, food and beverage manufacturers as well as service providers, basically the entire ecosphere of the foodservice industry, is that 2011 is already showing more promise than last year. This is good. While this is indeed a general statement of optimism, and not all sectors and segments are seeing the same thing or are created equal, I am still declaring that the state of our industry is strong and very encouraging.
I receive guidance from the media, from thousands of conversations taking place on FohBoh, from business blogs, through conversations I have weekly with operators, analysts, journalists, investment bankers, investors, lenders, suppliers, farmers and the otherwise “informed expert”. I also read reports like the Restaurant Industry 2010 Review and 2011 Outlook prepared by Demeter Group (See “Report below)”. Demeter is an Investment Banking firm based in San Francisco with an impressive restaurant practice lead by their CEO, Michelle Cherrick. Check out their “crystal ball” and pay attention to the trends and the growing EBITDA multiples. This is all good for an industry that has been hit hard by a lousy economy for years.
Driving this recovery, if you want to call it that, is acceptance by the consumer, a better attitude by the operator and new innovation. Personally, I haven’t seen such innovation and concept/marketing creativity in years. But, we also got better at what we do. Frankly, we are just better managers today than we were three or four years ago. Another thing driving all this is technology and our willingness to adopt and use social media.
It’s all good if you have a good attitude, continue to innovate while leveraging new ways to communicate and build customer loyalty using the social web.
So, again, I declare that the state of our industry is strong.