7 restoration trends that will define 2022 (2023)

This story is the first in a series of trends set to shape restaurants in 2022.

While many of the market forces that have shaped the restaurant industry in 2021 have been closely linked to disruption since the pandemic began in 2020, the new year will bring new challenges and opportunities.

Unprecedented labor and supply chain pressures will drive most of the restaurant trends that will define 2022, analysts say. This instability will prompt operators to cut costs, shorten menus, and invest in labor-saving technologies to free up money for pay increases.

"Where menus are relatively simple and contain fewer options, the possibilities for automation are almost limitless," said Brian Warrener, associate professor of food and beverage industry management at the University of Johnson & Wales School of Hospital Administration. "And five years ago, who would do that? Did you think there would be such a thing as a robot bartender? ... I certainly think this type of technology is progressing. Maybe robots [will] be better able to do even more complex tasks and maybe we'll see more human-machine substitution."

Restaurants will also explore delivery options beyond costly third-party partnerships, raising delivery menu prices to make the channel more profitable as off-store demand remains constant.

“The actual delivery act is run by a number of different companies who really have no interest in what [restaurants] are doing. They just want to go in there and take their money ... They're trying to be transformative, and they're transactional," said Stephen Zagor, director of Steve Zagor & Associates and an assistant professor at Columbia Business School. "You want to start with your delivery moment create experience. How do you do that?"

While these projected headwinds come as a surprise to restaurants large and small, the year could still bode well for the business, experts predict. A range of cheap commercial real estate could grow food halls, which became a popular and profitable format before the COVID-19 crisis, and provide outposts for independent businesses looking to expand.

Rising diner interest in plant-based foods also represents a strong selling opportunity for restaurants that are not yet offering meat analogues or want to offer alternatives to proteins that have become scarce and expensive due to supply chain delays.

Learn more about the seven trends analysts predict will shape the restaurant industry in 2022:

More investment in new, labor-saving technologies

How restaurants are preparing for itongoing labor disputes, more operators will invest in technologies that make them less dependent on employees, minimize costs and maximize efficiency, experts say.

Half of US airlinesplans to introduce automated technologies that save laborin the next two or three years, such a "Lightspeed's Global State of the Hospitality Report. According to the report, forty-one percent of US airlines are affected by a pandemic.

Warrener predicts that for the foreseeable future, restaurant tasks automated by machines will continue to consist primarily of simple administrative tasks like washing dishes.

"The restaurant industry has historically been very technologically backward," said Jim Balis, managing director of strategic operations at CapitalSpring. "I think you're going to see a lot more about robots... The best example was probably the coffee shop area, where it's a combination of liquids, powders and ice that a robot or some kind of automation can easily do."

Balis said the same type of technology could be applied to making smoothies and bowls, a trend the industry sees gaining momentum in 2021.

post, for example,introduced an automated smoothie kioskin a Walmart store in late 2020 and expanded this offer to other locations last year. green candy tooacquired the self-service restaurant company Spycelast year with plans to implement the technology in its restaurants to improve food quality and store efficiency.

"A robot doesn't get sick, it usually works weekends, it doesn't have an affair with another employee," Balis said of the labour-saving technology's appeal to cash-strapped retailers.

Balis also hopes to see more speech-based AI in the drive-thru, especially as this channel has performed very well during the pandemic and continues to see heavy traffic. Drive-thru bots can improve performance and also create upselling opportunities, he said.

"I spoke to a company [recently] ... that does facials. So you go to the drive-thru, realize who you are and what you've asked for in the past, and then you pay with your face. " said Balis. "Well I think more and more you'll see that."

Labor and supply chain disruptions keep simplification on the menu

Supply chain issues, rising grocery costs and a lack of available labor have prompted many restaurants to scale back menus. At the end of Q3 2021, the total restaurant menus on offer were 10% lower than before the pandemic.Agree with Technomic. As the economic disruption from COVID-19 drags on, menus may continue to shrink.

Alec Haesler, director of Carl Marks Advisors, said if a protein source experiences sustained price inflation or shortages, traders are likely to switch to proteins.

Meaghan Brophy, retail content producer for Fit Small Business, said restaurants are likely to downsize their menus to streamline production processes for outside orders and organize kitchens more efficiently.

According to Rick Camac, dean of restaurant and hospitality management at the Institute for Culinary Education, lean menus are likely to last. Work pressures will make it difficult for restaurants to reintroduce menu items that have been scrapped during the pandemic.

"I don't miss the monster menus, which I don't think we'll be seeing any time soon," Camac said. “Smaller, more streamlined menus are definitely another trend that will continue. I don't see us all going back to those multi-page monster menus anytime soon.”

Shorter menus can save on labor costs and reduce waste. According to the National Restaurant AssociationAnnual survey of the most important trends, menu simplification is expected to continue through 2022.

At the DoorDash Mainstreet Strong conference in October, Hudson Riehle, senior vice president of research and insights for the National Restaurant Association, said that 8 out of 10 table service restaurants had to reduce their menus due to supply chain issues, while about 7 out of 10 QSRs were out cut off theirs.

"However, certain commodity groups, notably beef, chicken, pork and egg proteins, are reaching double digits [wholesale price inflation]," Riehle said. “If we look again at 2022, it won't be that high. But especially in the first six months there is no relief.”

Changing customer expectations can also cause chains to shorten menus, particularly for QSRs.current ratingfrom Oracle indicates that customers can expect shorter delivery times, and some chains have already responded by streamlining delivery offers. Burger King removed some cumbersome menu items to speed up its service after the pandemic sparked a spike in out-of-store orders and lengthened delivery timesin all areas.

Big networks are driving plant-based growth, while network operators are offering more ways to save money

Last year marked the start of a string of plant-based meat launches at major restaurant chains, includingMcDonald's review of their McPlant products(made in collaboration with Beyond Meat), aParceria da Impossible Foods Ghost Kitchen with a dog houseand Starbucks'Try a 100% plant-based menuat a store in Seattle.

A recent analysis by Peter Saleh, CEO and restaurant analyst at BTIG, suggests that McDonald's investment in factories is paying off. BTIG estimates that several of the chain's eight test restaurantssell up to 500 McPlant sandwiches per week, or about 70 a day, compared to BTIG's original forecast of about 20 to 25 McPlant sandwiches a day.

"Anything plant-based is going to explode in the next few years," Camac said. "I'm involved in raising public and private funds for two different [herbal] companies ... but their future projections."

Zagor predicts that both plant-based meat analogues and vegetarian dishes will rise in popularity until they become ubiquitous in chain restaurants.

“There are two points of view. There are products that mimic plants, products that aren't normally plant products but are suddenly made from plants, like chicken, beef, pork, shrimp and sushi," Zagor said. "Then there are the plant opportunities, where you actually eat plants that are plants ... [where] we do something different with your beets and asparagus to make them special."

Camac believes the impact of large chains offering plant-based products will significantly accelerate the adoption of plant-based products across the industry.

"Once the mainstream realizes this, the trend will accelerate instead of slowing down, which I think happened even last year," Camac said.

Plant-based products could also help restaurants create their menus at a lower cost without losing customer interest, Camac said, which could help operators struggle with thisincrease in meat pricesFor example, due to bottlenecks in the supply chain.

"You're going to see that you're going to rely more on salary and benefit increases to attract new hires and improve employee satisfaction metrics and work-life balance and things like that to try to minimize burnout," Haesler said.

The continued prevalence of COVID-19 will drag down the labor market. A similar effect occurred in the fall, when the delta variant wiped out most job gains in the first half of 2021, according to Elise Gould, senior economist at the Economic Policy Institute.

"These jobs have been degraded by the pandemic," Gould said. New cases remain high. The last week of December broke records for daily cases,486,428 on December 29th, the latest day for which the CDC announced the number of cases. All of this means the ongoing impact of the virus on workers is unlikely to go away.

"People are less willing to take the kind of risks that a restaurant job involves," Brophy said. "So they're turning to other industries like catering and things that offer less risk and also higher wages."

These factors have led to a sustained decline in restaurant employment. In November 2021, around 750,000 fewer people worked in the catering industrythan in February 2020, based on seasonally adjusted BLS data. That shortage has contributed to an upward trend in wages, BLS data shows, with restaurant wages averaging $16 an hour through October 2021.

Bank of America chief executive Cristin O'Hara said the industry's best hope is to recruit and retain younger workers and give them opportunities to rise through the ranks.

"If we can keep some of these teenagers in the system, working and contributing, I think that's going to be the savior for 2022 and beyond as they get more training and experience because there's deputy managers and regional managers and managers of whatever always lacking type," he said. O'Hara.

But Camac said he expects those labor shortages to remain stable.

"There is no silver bullet," Camac said. “I don't see anything else that [the job market recovery] is going to do anytime soon other than this slow, gradual, painful urge to rebuild new perspectives, rekindle people's interest, and change your model. People are more interested."

This pressure has prompted restaurant companies to do soDardenAStarbucksincrease the hourly wage. However, according to BLS data, inflation has eaten away all wage increases across the economy. While wages may increase nominally in 2021 compared to 2020,Real income is actually lower.

Canteens will fill vacant commercial properties

Even before the pandemic, canteens were popular with younger customers, and many developers designed these concepts to anchor large offices or multi-family projects. Cantinas often offer quality food at an affordable price, as well as a social experience,according to a report by Cushman & Wakefield. As of 2016, the property has registered 223 operational dining rooms in the United States and an additional 165 under development.

While the COVID-19 crisis has brought the cafeteria business to a standstill for the past two years, interest from developers is increasing. Camac said several companies are creating large dining rooms that emphasize different types of cuisine, such as French or vegan food.

"Cafeterias are growing at a tremendous rate," Camac said. "One of the reasons for this is real estate availability. There are many properties that offer better prices than they have in many, many years."

Many developers who started planning projects before the pandemic now have large spaces they can't fill, creating more opportunities to build dining rooms, Camac said.

Cushman & Wakefield found canteens have been more resilient during the pandemic compared to other retail categories, with 75% managing to stay open by switching to a ghost kitchen model. For example, at a cafeteria in Omaha, Nebraska, vendors banded together to sell a "World trip food"with takeaway packages to give a taste of each of the concepts. Many dining rooms also have spacious outdoor patios or rooftop gardens, Cushman & Wakefield said.

Communal kitchens can provide security for owners because they don't have to deal with a large vacancy when a kiosk closes. This can be a real benefit sincemore than 10% of the restaurantsThey have closed during the pandemic and many others are not yet sure of their future.

Delivery menu prices will rise as restaurants consider options beyond third-party providers to make the channel viable

With dining rooms closed in many markets for most of 2020 and part of 2021, restaurants have turned to delivery to reach customers. But as canteen traffic increases, operators will reconsider their strategy around the canal going forward, analysts said.

Over the next 12 to 24 months, restaurants will evaluate what business tactics are profitable and how to persuade customers to return to their establishments, Haesler said. For some operators, this could mean pressuring customers to use take-away instead of delivery.

"Obviously, the margins on drop shipping aren't very good," Haesler said. "I don't think it's a viable option as a main cash flow generator, but more as a blended approach in combination with everything else. I think it's still an important aspect of the business."

To keep things at least margin-neutral, many chains have increased prices on their take-out menu, which hasn't necessarily resulted in a drop in customers, Saleh said.

"As long as consumers want it and are willing to pay for it, which clearly seems to be the case, I think [the supply] will continue to evolve and continue to grow," Saleh said.

Some restaurants might be considering ways to set up their own business or cooperative to facilitate delivery, rather than relying on transactional relationships with those customers through outside partners, Zagor said.

“The entire delivery model will evolve. I don't necessarily believe in 2022, but I do think the seeds will be planted for a much more proprietary and relationship-based delivery program," Zagor said.

Operators will phase out rudimentary curbside pickup offerings or invest in time-saving collection lockers and shelves

As off-premises demand remains stable, restaurants will also focus on expanding their digital platforms.

"[Digital ordering] for pickup is actually a bigger behavior than delivery, and both are growing very rapidly," said David Portalatin, senior vice president and industry advisor at The NPD Group, adding that many consumers are taking ownership. Your meals to make off-site dining more affordable.

Customer interest in cheaper off-premise options is one of the main reasons restaurants are doubling down on their drive-through lanes, including those dedicated to digital picking. Operators are also changing workflows to provide dedicated pickup areas at restaurants, Portalatin said.

However, curbside pickup, which gained popularity during the cafeteria closure, is likely to be phased out, Balis said.

“It's a combination of consumers' reduced fear of going to the restaurant to pick up their food and the work challenges we face. As we try to be more efficient in our work, the sidewalk is very inefficient," he said.

Curbside is convenient for the guest but relieves the restaurant employee of the work of taking orders or preparing food, he said.

Restaurants that choose to keep curbside pickup can make the channel more efficient by providing shelves and cabinets for pickup. However, interest in high-tech cabinets with heated or cooled interiors may wane as these products require third-party integrations and Wi-Fi, Balis said. Standard shelves arranged by name, on the other hand, do not require any additional technology and are easy to assemble. However, operators must weigh the riskfood theftor a customer picking up the wrong order, he said.

“That's the way of sharing this technology. I think you're going to see [van boxes], but I think [adoption] is going to be slower than you might expect for those reasons," Balis said.