Article
The year ahead
Seven take-to-the-bank predictions for 2009.
December 29, 2008
With sales pegging the needle at $558 billion across 950,000 locations, the restaurant industry is a driver of the U.S. economy. And because consumer confidence is reflected in how often those consumers eat out, it's conversely true that the economy drives the restaurant industry.
Not surprisingly, then, the depth and longevity of the economic downturn — which worst-case fears say will morph into a depression — will be the big news for restaurateurs in 2009.
But they certainly won't be the only news. Consumers will make choices more carefully, network with each other more, continue to eschew old service models and demand quality. Those factors and more are ones to watch in our predictions for 2009.
1. Casual and upscale dining falter
The casual and fine dining restaurant segments will falter. For 12 consecutive years, the NRA has reported growth for them. For 2009, however, the association turned expectations downward. This act alone should have the industry very concerned. The financial downturn, tighter credit and rising commodities will add to the pressure as the financially strapped consumer eats out less.
2. Social networking becomes even more important
Only recently have social-networking sites such as Facebook and MySpace begun to play an important role in the restaurant industry. Next year, they will be so interconnected to location-based networking that any restaurant could become a success — or a failure — merely by connecting with the right platform. The phenomenon will gain additional momentum as more consumers adopt Web-ready mobile devices. According to Nokia, 250 million such phones will be on the street by 2010.
3. Fast casual goes mainstream
Still mostly unknown to consumers, the term "fast casual" has been used in the industry for years. That's about to change, with the mass adoption in 2009 of the fast casual service model. Consumer demand will show the mainstream media how the segment has taken hold and will continue to do so over the next 10 years. The economic downturn will only help this emerging market as consumers look for less expensive fare that doesn't sacrifice quality.
4. Healthy and sustainable gain more ground
Sure, these have been hot topics for some time now, but it seems that when "green" took hold, healthy took the back seat. And when "green" and "eco" became something else, the new term "sustainability" sprung into the market. The point is clear: Consumers want to
move away from the old way of thinking, and operators finally understand what that means. As a result, 2009 will be the year businesses really begin to meet the demand for sustainability and quality that yields healthy and enriched ways of consuming food. But this also entails more sustainable power and paper and suppliers who understand what sustainable technology can do to move this massive industry in the right direction.
move away from the old way of thinking, and operators finally understand what that means. As a result, 2009 will be the year businesses really begin to meet the demand for sustainability and quality that yields healthy and enriched ways of consuming food. But this also entails more sustainable power and paper and suppliers who understand what sustainable technology can do to move this massive industry in the right direction.5. Wine and beer are reborn
In 2009, we will see new tasting bars pop up, along with tasting centers inside hotels and all levels of fast casual and upscale dining establishments. "By the glass" could be replaced by "by the taste." Does that mean micro beer could be left out? On the contrary: Beer is still one of the fastest-growing alcohol segments in the United States, with consumers sipping more beer than wine in each of the past three years.
6. National expansion slows while local and regional maintain
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• Regional players will become higher-quality lifestyle restaurants with impressive market penetration. Look at any major fast casual, and you will find them dominating in certain regional areas.
• It becomes much easier for regional concepts and operators to bring higher-quality products to the consumer with a sustainable or local market approach.
This will mean slower growth for the national chains, but the good news is that it may drive them to create a new way to do business with a local and regional focus.
7. Lifestyle restaurants emerge
What is a lifestyle restaurant? Simply put, it is one that adjusts to the changing lifestyle of today's consumer. The lifestyle restaurant of the future will be one that can adapt quickly to the massive change taking place in our society, whether operators rapidly change the menu, offer wine tastings, create gourmet cooking classes, offer take-away and catering with new creativity and variety, bring in new and exciting menu concepts or even change their very service model.
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