A Tough Year for the Restaurant Industry:
Last year proved to be difficult for the restaurant industry. Nation’s Restaurant News reported yesterday that Buffalo Wild Wing’s fourth quarter net earnings plummeted 38.2%. The company’s fourth quarter ended on December 25th, 2016. Company-owned restaurants saw same-store sales fall 4% while franchised stores saw sales fall 3.9%. Buffalo Wild Wings CEO Sally Smith made a statement about the issue, citing “the challenging restaurant environment” as the source of struggle. Chipotle also took a hard hit in their fourth quarter. As the company dealt with food borne illness outbreaks across the country, net incomes fell 76%.
It is no surprise that restaurants nationwide faced similar hardships. For many restaurants, the overall decline in net profits can be traced back to two main contributing factors: weak same-store sales and slow traffic. According to the National Restaurant Association, 42% of operators reported a same-stores sales decline in December of 2016. Operators also reported a 47% decline in traffic for that same month.
Expectations and optimism remain high, though, for the year ahead. About 39% of restaurant operators told National Restaurant News that they expect same-store sales and traffic to improve within the next 6 months. This is a 25% jump from when operators were surveyed back in October of 2016. Also heartening for the industry is that 57% of restaurant operators surveyed expect to expand or remodel within the next 6 months.
Dedicated to Success in 2017:
Here at Patrice and Associates, we are also optimistic about the year ahead. As the nation’s leading hospitality recruiting firm, we know how fundamentally important staffing is to a restaurant’s success. Finding strong, talented candidates to fill leadership positions can make all the difference when running an effective business. Strong leaders help shape a business’s culture and can be instrumental in improving overall service, efficiency, profitability, and more.
Overall, we are excited to continue working hard in 2017. Every day, our dedicated Franchisees and Recruiters help find and place the restaurant industry’s top leaders. By ensuring the success of our clients, we are also ensuring the growth and prosperity of the restaurant industry itself. We look forward to continue doing so now and for many years to come.