Anthony Anton, president & ceo of the Washington Restaurant Association, at the Northwest Foodservice Show
Washington's largest private-sector employer isn't aerospace manufacturing or software development; it's the restaurant industry. Over 200,000 people work in the state's 13,000 restaurants. Heading up the industry's trade group, the Washington Restaurant Association, is Anthony Anton, a self-described statistics junkie, who delivered the keynote address to the Northwest Foodservice Show yesterday.
Four years ago, Anton was soft-pedaling the early effects of the recession. These days, he's acknowledging that times have been tough, but insists that the industry is holding its own.
Restaurants took in nearly $10 billion last year, an average of about $800,000 per unit, up by about five percent from 2010.
Trouble is, expenses went up faster than revenues. Food costs alone rose by nine percent, and wages were up four percent. Because of the state's high minimum wage, the average Washington restaurant employs fewer workers than the national average (14 compared to 17). In a sense, the recession has prompted an increase in smaller, ethnic restaurants. Nearly 1,000 new eateries opened in Washington last year. "Persuing the American dream," is how Anton describes it.
So what are the food trends that Anton sees in his crystal ball? First of all, not on the horizon but directly underfoot, the increasing emphasis on local food. Locally sourced meat, produce, seafood, spirits, wine & beer. A clientele that's increasingly conscious of the environment. Families who want healthy food for the kids. Chefs with an increasing awareness of allergies and food sensitivities, as described by Rebekah Denn yesterday.
Why go out at all? Used to be, decades ago, a restaurant meal was a special occasion: a birthday, a celebration. Nowadays, we go out because it's Tuesday. Or just because we're hungry. Used to be, we ate chicken or beef; now we're more likely to eat Thai or Italian. In fact, "Asian" food is about to overtake "American," with Indian and Middle Eastern menus gaining in popularity. (Don't worry, Ilsa, "We'll always have Pizza.")
Aside from menu changes, the industry is facing a tough set of challenges. One that will take place out of sight from the dining public: the issue of "tip pooling." Servers average over $14 an hour in tips alone, over and above their wages which, in Seattle, exceed $10 an hour, while line cooks typically earn $11 an hour. But servers who share their tips with kitchen staff get dinged by the payroll tax on an imputed "tip credit," yet formal tip pooling remains difficult to put in place.
Liquor privatization is another challenge, since no one knows yet quite how the implementation of Initiative 1183 is going to affect purchasing routines. (Distillers and distributors turned out in force at the Foodservice Show.) Health care reform is another issue, since all businesses of a certain size will be required to offer insurance coverage to employees working more than 30 hours a week. (Look for a lot of 29-hour workweeks in the industry.)
And then there's developing, implementing and managing a social media strategy. Is this another monthly expense to outsource, like dishwasher maintenance, in an industry with four percent margins? Or is another daily chore to be carved out of a manager's time?
Here Anton comes down squarely (Foursquarely?) on the side of engagement. "Hey, you're talking to your customers!" he points out. "That's something you want to do."