Foodservice industry sales are to reach $997 billion in 2023, according to the “2023 State of the Restaurant Industry Report” by the National Restaurant Association.
That’s up $60 billion from last year’s report, driven in-part by higher menu prices and increased demand.
The annual survey highlights several “pandemic pivots” that have become permanent, including the expansion of delivery, drive-thru services, outdoor dining options, to-go alcohol offerings and investments in technology.
Upward tech trends
About 4 in 10 restaurants plan to invest in equipment and technology to increase front and back-of-house productivity in 2023.
This is most anticipated in the ordering and payment space (from kiosks, smartphones, QR codes etc.) rather than in robots that prepare and serve food.
But the survey does report that 58 percent of operators say using tech and automation to alleviate labor shortages will become more common in their segment this year. However, it notes this is generally complementary to human labor, intended to enhance rather than replace workers in the restaurant industry.
The association expects the industry workforce to grow by 500,000 jobs, totaling 15.5 million by the end of 2023. Yet, hiring challenges remain, with only 1 in 10 operators believing recruiting and retaining employees will be easier in 2023 than in 2022.
More screen time okay for most diners
When it comes to consumers’ adaptation of tech in the restaurant space, nearly 80 percent of Gen Z adults are okay with “talking to a screen” compared to 55 percent of baby boomers —whether that’s in walk-up counters or drive-thru windows with AI voice ordering, to name a few.
“Consumer research shows people are receptive to using technology in the restaurant experience, especially among younger cohorts,” said Hudson Riehle, senior vice president of research for the National Restaurant Association, in a press conference.
“Where they want to see it first is in ordering and payment, second in customer service and third in providing information on food and beverages as well as timing [delivery and pick up times],” Riehle added.
Riehle also notes how the digitization of menus is increasing, as the integration of technology enables updates to menus and price changes in real-time.
Two-thirds of adults say they are more likely to order takeout than they were before the pandemic.
Among fine-dining restaurants that offered delivery during the pandemic, 79 percent added it for the first time and 8 in 10 plan to continue use.
Off-premises-only locations are expected to grow in popularity, with more than 4 in 10 limited-service operators believing it will become more common this year.
“As the restaurant industry adapts to a new normal, operators’ ability to be flexible and diversify their operations is essential to thriving,” said Riehle. “With profitability under pressure, operators are launching new business models within the industry, re-engineering current concepts, and allocating more space to off-premises business in order to satisfy customers in 2023.”
But the outlook for the ghost kitchen sector is divided, with about one-third of operators expecting the concept to become more common, while roughly the same expect them to become less numerous. With that, about 70 percent of diners say it’s important for their food to come from a public, physical location as opposed to a ghost kitchen.
Food prices will remain elevated in 2023 with 93 percent of operators saying their restaurant’s total food costs are higher than they were in 2019.
Operators are taking into account remote work blurring traditional meal times, and are focusing on new opportunities to entice customers at all hours with offerings such as subscriptions, slow-day value deals, flexible pricing, loyalty programs and more.
The full report can be accessed on the National Restaurant Association’s website.
Founded in 1919, the association includes about 1 million restaurant and foodservice outlets.