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A National Restaurant Association survey conducted between 7 September and 15 September paints a less-than-rosy picture of the current state and the future of the restaurant industry.
As reported by CNBC, more than half of those surveyed said that business was worse now than it had been three months ago. Only 9 percent said that business had improved during that period.
More than 75 percent of the restaurant operators reported being short-staffed; among those, 83 percent were understaffed by 10 percent, while 39 percent were understaffed by 20 percent. Many reported they had reduced their hours and the number of menu items offered, to deal with the staffing issues.
With more mandates being imposed, such as showing vax passports before entering plus staff shortages, 45 percent of respondents said that their restaurants weren’t open at full capacity for indoor dining; see “NYC: OUTDOOR EATING GOOD, INDOOR BAD,” (29 Sep 2020).
The restaurants have also been plagued by supply issues, with 95 percent of respondents experiencing delays or shortages during the past three months. And 91 percent reported that their profit margins have shrunk, with food costs rising and accounting for a higher percentage of sales; see “RESTAURANTS, FOOD PROCESSORS RAISE PRICES TO MEET COSTS” (20 Jul 2021).
Most of those surveyed don’t expect the next three months to be any better; more than half believe business will decline even more.
As we had forecast, with the media’s non-stop spreading of Delta variant fear and hysteria, COVID-19 is among the reasons cited for the decline and for the gloomy outlook. Only 64 percent of U.S. adults feel comfortable dining at a restaurant; see “WORKER SHORTAGES, VIRUS HOBBLE RESTAURANTS’ RECOVERY” (14 Sep 2021), “DINERS AVOIDING RESTAURANTS FOR FEAR OF COVID” (17 Aug 2021) and “RESTAURANTS FACE BLEAK WINTER” (21 Sep 2021).
The survey results are being used by the trade association to lobby in opposition to President Biden’s proposed hike in the corporate tax rate and to proposed changes in the National Labor Relations Act that would impose $50,000 to $100,000 fines for labor violations. The association is also asking for the Restaurant Revitalization Fund, created to help keep the industry afloat during the challenges of the COVID War, to be replenished.
A National Restaurant Association vice-president appealed to congressional leadership: “Restaurants still need help today and overwhelming them with costly new obligations will only prevent progress in turning the tide of recovery.”
TREND FORECAST: As winter sets in across the U.S. and more Delta variant fear and hysteria is spread by the media—plus more vax passports and other COVID War mandates imposed by politicians—restaurant sales will continue to decline.
And, the further equity markets dive, the higher inflation rises and the deeper the economy sinks, more restaurants will go bust and overall sales across the industry will decline.