The Board: January 2023

Happy New Year Reader!

I hope you enjoyed a great holiday season. The new year is upon us and I’m excited to grow and develop this newsletter to be your timely and relevant source for industry happenings. Some early signs indicate 2023 could be another roller coaster, but we are here to keep you up to date with data trends, information and insights all in one short, digestible email.

We’ve had some excellent feedback, readers are loving the data so far and are hungry for even more. Look for more and deeper insights coming down the line in a couple months.

I’m always interested to hear what you'd like to see more of in this newsletter or what you think could be 86'ed. Please reply and let me know.

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Have a wonderful week and here’s to a more profitable 2023!

- Tracy & the MarginEdge team

MONTHLY METRICS

December National Restaurant Sales & Price Movers

Dig in to the full report.

ITEM TO WATCH

Lettuce

Seems like every January some version of  “new year, new you” is hitting social feeds, digital ads, gym membership mailers and grocery flyers. While dry January means less alcohol sales (but bring in the mocktails!), chances are restaurants will be selling more salads.

Lettuce has had some rough times recently. Near the end of 2022, the Salinas Valley (which supplies about half of the U.S) was devastated by INSV, a virus spread by insects. Restaurants resorted to actively advertising they may not have lettuce available. It was three of the five top five price movers in our November report.

Current trendline in our data shows over all lettuce varieties, the median month over month price is down 17% (as of January 1). Looking at price points specifically, January 2018 had $2.42 average per pound with an increase to $3.44 as of this week’s data.

Chef Geoff's, Washington D.C.

ASK [me] ANYTHING

How can I focus customer attention on my most profitable menu items?

There’s a few ways to subtly get the customer’s attention headed towards more profitable items (your stars). We’ll stick to a list to answer here, there’s more detailed information in this blog post.

1. Social media - whatever platform you have, leverage it to get the word out about the menu items making the most money for your business.
2. Specials - having a salmon special when you’ve scored a great deal on a few cases is chef’s kiss. Make sure your servers gush about how delicious it is (because it really is).
3. Menu design - psychology plays a part, take a look at this handy infographic addressing everything from color theory to removing the dollar sign.
4. If the star on your dinner menu, try adding a smaller portioned version to your lunch or brunch offerings. 

Ask [me] anything!
Really. Each month we’ll take a look at the questions we get and answer one here. Have a question about our product, accounting or restaurant operations in general? Email me or message us on our social media channels.

Oak & Ola, Tampa, FL

THE ECONOMY

Order Inflation Up (but it's still slowing)

Inflation is cooling off based on Thursday’s Consumer Price Index data from the federal government’s Bureau of Labor Statistics. December data shows inflation at 6.5% on an annual basis, down from 7.1% in November. Food prices both at home and away from home increased by 0.2 and 0.4 percent, respectively. 

Gas prices plummeted so hopefully Bank of America’s noted correlation between dropping gas prices and increased restaurant sales continues. The National Restaurant Association predicts a mixed outlook but with increased optimism compared to the last few years.

Data is data, but PYMNTS found in a recent survey there’s a bit of a disconnect between the numbers and what consumers say they are experiencing. I’d love to hear what you are seeing in your business.

'TIS THE SEASON

Prepping for 2023

Inflation has hit our industry hard in 2022. Economic projections by Kiplinger predict that inflation will not ease until late next year, where it is predicted to fall to 3-to-4 percent by the end of 2023. This creates a unique challenge for restaurateurs, as consumers usually cut back on meals purchased at restaurants and take out foods as the first extraneous expense when faced with inflation. To cope with this economic landscape, our CEO Bo Davis sat down with Modern Restaurant Management with some recommendations. 

The TL;DR is restaurateurs need to adapt by overhauling both aspects of their business: operation and business administration. This can include diversifying income streams, implementing loyalty programs, and streamlining menus. Additionally, restaurateurs can save money by using new digital platforms to manage backend processes such as invoice processing, ordering, food cost management, and analysis.