Another newsletter coming to y’all from an airport, this time I’m in Houston headed back from the Texas Restaurant Association show. It was great to meet so many Texans doing great work for restaurant guests, both locals and visitors alike. The restaurant industry overall is filled with folks dedicated to their craft, whether it be back of house or front of house, your dedication truly makes a difference.

With 2023 restaurant sales getting pretty darn close to one trillion dollars and restaurant seasonal hiring predicted to reach its highest level since 2017, we are optimistic for the future despite some nagging inflation.

I would be remiss if I didn't share this month’s product release notes which feature some star-spangled updates (including mobile bill pay!), please check them out if you haven’t already.

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- Tracy & the MarginEdge team

MONTHLY SALES METRICS & UPDATE

Fast Casual restaurant sales had quite a month across the nation this June, despite poor air quality impacting a significant part of the country. By segment, Fast Casual beat out Full Service, ending the month with 5% sales growth, and Full Service a dip of 2% compared to June 2022's numbers. 

Dig in to the full report.

ITEM TO WATCH

BLT

Summer means really nice, juicy tomatoes. Beefsteak, Roma, cherry and those beautifully misshapen heirlooms will be gracing seasonal menus as well as making even the humblest burger or sandwich a little more special. I live a bit south of the MarginEdge headquarters, in Richmond, Virginia, home the Hanover Tomato Festival and of Duke’s Mayonnaise which is promoting Hot Tomato Summer among four cities’ restaurants. 

A quintessential summer sandwich (for me anyway) is the BLT. I thought it would be a fun set of ingredients to dive into. As of June 2023, bacon, lettuce and tomato (and to my surprise, mayonnaise) all made it into our top 15 items purchased by volume last month.

Looking at the data, I would have surmised lettuce and tomato prices would travel together, which they have for most of this year until extreme weather conditions were impacting the “salad bowl” of the U.S. We have seen bacon prices remain pretty stable which is great for breakfast plates as well as those sandwich and burger toppings.

Wasabi | Tyson's Corner, VA

ASK [me] ANYTHING

The news about inflation is freaking me out!

Ok, so technically this is not a question, but we’ve been hearing this statement quite a bit. We do agree, headlines and pundits seem to be gloom and doom about an impending recession. Less visits, less being spent, and less foot traffic. Seems like the articles are nonstop negative for restaurants, despite the National Restaurant Association offering a contrary opinion earlier this year.

Digging a little deeper into less mainstream media for data (one of my favorite activities) we definitely see some differing opinions. Supermarket News reports over July 4th, consumers “didn’t seem to care” about inflation and analysis of almost two million shopper orders showed 67% of consumers considered dining out more due to high grocery prices. McKinsey’s June report shows 38% of consumers intend to splurge on restaurants (the highest category). 

Fast Casual’s 5% growth year-over-year in June for our clients definitely does not say “recession”. We do have a very close eye on it and will be the first to let you know if we see changes.

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.

El Rey | Arlington, VA

THE ECONOMY

Order Inflation Up (a little)

Overall inflation rose a mere 0.2% in June and year-over-year rose 3%, both of which were less than anticipated (hooray!). Food away from home (aka restaurants) is creeping up at a faster rate, 0.4% since May and 7.7% year-over-year. The index is further broken down between full service meals, which have increased 6.2% since last year, and limited service which is up 7.8%. American Express reports 87% of restaurants raised menu prices last year.

Zooming into what’s happening at the wallet level, consumers don’t seem to be too worried. According to the University of Michigan, the consumer confidence number was 72.6 this month, the highest level since September 2021. The Conference Board report also showed the highest number since January 2022.