Like many readers of Nation’s Restaurant News, I am deeply passionate about the restaurant industry and concerned about the wave of bankruptcies and near-bankruptcies sweeping through it. In my conversations with hundreds of operators and industry leaders, fear and confusion are prevailing emotions. This “Emergency Restaurant Broadcast” aims to bring together some of the sharpest minds in the industry — with their functional expertise — to break down what’s really happening. Yes, we all know traffic is down across the board, but why are some brands navigating these challenges successfully while others are struggling to stay afloat?
Some of the driving factors we discuss:
- COVID overhang
- Inflation, price-taking, and elasticity of demand
- Real estate lock-in — long-term leases and right-sizing the footprint
- Third-party dependency and the rise of 3PD marketplace advertising (a $1B business for Uber already)
- The liquidity crunch — restaurant multiples and valuation drivers are changing (“good” and “bad” revenue), which is impacting access to capital
- Margin pressures, labor, and the regulatory environment
Overall, our panel of experts — Andrew K. Smith of Savory Fund, Meredith Sandland of Empower Delivery, and Ellie Doty of High Impact Marketing — remained optimistic that the industry will weather this storm, as it has during past downturns. However, they also emphasized avoiding band-aid solutions and quick fixes. Instead, brands should make the tough choice to “pause and perfect” their business models. Focus on EBITDA rather than just store-level margins, and prioritize good, repeatable revenue from loyal customers over bad, short-term gains from less engaged ones. Be cautious of too-good-to-be-true promises from third-party delivery platforms, and don’t rely on the hope that more capital is just around the corner. These short-term “fixes” are often the very decisions that end up sinking businesses in the long run.
Join us for a riveting discussion that is often lacking in the conference circuit. Instead of glossing over real challenges or focusing only on significant, resource-heavy brand success stories, we dive into the actual results and details that matter to most of the industry. This conversation is for those facing the day-to-day struggles head-on, providing insights and solutions that resonate with operators navigating the harsh realities of today’s market.
AUTHOR BIO
Zach Goldstein is the CEO and Founder of Thanx. Founded in 2011, Thanx is a guest engagement and retention platform helping become more digitally agile to maximize customer lifetime value. Prior to earning his MBA from Stanford, Goldstein honed his experience in the customer loyalty space at Bain & Company, helping companies perfect their retention and reward strategies as early as 2005.
