15 Challenges District Managers Will Face in 2015

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For many restaurants, 2014 was a good year. The economy has been on the mend, and many stores saw improved sales and full houses. But, of course, it wasn’t without its challenges, and 2015 won’t be either. Some of these issues and predicaments come up year after year, while others are unique to the coming year. That said, all of them can be addressed successfully if district managers educate themselves early and tackle them head-on.

Here are 15 challenges you should be aware of for 2015 (and some advice on how to handle them):

1. Taxes

As they say, there are only two things you can count on in life: death and taxes. So, yes, taxes are an annual burden for the restaurant business, but 2015 will prove more thorny than usual for many of us. Why? Many business-related tax breaks have expired recently and may or may not be renewed given the current state of Congress in this midterm election year. For more details, check out this post and plan ahead so there are no nasty surprises come April 2015.

2. Compliance

Another area that is a perennial challenge for restaurant district managers is compliance. In the wake of 2014’s multitude of high-profile security breaches, 2015 is a good time to renew your commitment to ensuring that your business is compliant. One place to start is with PCI data security standards, which can help you ensure that your point of sale system is secure and compliant with national regulations. The new year is also a great time to invest in automated tools like Squadle that enable you to build custom checklists and thus ensure compliance with a wide range of mandates.

3. New POS Technology

With the advent of Apple Pay, mobile point of sale and consumer-facing mobile wallet technology are set to go mainstream. You can bet 2015 will be a turning point for this type of technology, and customers will increasingly clamor for the ability to pay with their phones.

While you may not be in a hurry to flip your current POS technology, run the cost-benefit analysis. In many cases, the data you can collect about your customers via these more advanced POS systems -- and the marketing potential of that data -- makes it worthwhile to upgrade.

4. Food Safety

Another area that is a continual concern for district managers is food safety. 2015 will be no exception to that rule.  

According to the CDC, each year, 1 in 6 Americans gets sick by consuming contaminated foods or beverages. Around half of that takes place in restaurants. To prevent this from happening in your restaurant in 2015, make food safety a priority and implement standardized checks and balances that can help ensure that nothing goes wrong.

5. Minimum Wage Increases

The minimum wage is increasing in many states (as explained here). In Seattle, for example, the city has decided to gradually raise the minimum wage to $15 over the next seven years. San Diego will vote on similar legislation in 2016.

There’s a good chance your restaurant will be affected by minimum wage increases in the coming year, especially if they are enacted nationally, as President Obama hopes they will be. To deal with this challenge, read our explanation here of how digital reporting can help restaurants thrive amidst minimum wage increases.

6. The Affordable Care Act

In addition to shifting tax breaks and increases in the minimum wage, the Affordable Care Act poses a very real challenge for many district managers. In some cases, restaurants that were not previously liable for providing healthcare for all of their full-time employees must now do so. The National Restaurant Association has a helpful primer for restaurants looking to meet this challenge head-on.

7. Shifting Dining Trends

Dining trends change quicker than ever in the era of Instagram and celebrity chefs. For many district managers, it’s challenging to find a balance between staying true to the character of their restaurants while also meeting the interests and desires of consumers’ rapidly changing palates. If trend prediction lists like this one are to be believed, 2015 will be a year of oysters, spreadable sausage, pistachios and shaved ice. It’s up to you which techniques, flavors and ingredients you ultimately decide to incorporate into your menu in 2015, but one thing’s for sure: you have to change with the times.

8. Food Meets Science

Even beyond changes in specific foods and tastes, there are also new movements reading their heads for 2015, including what some have termed neurogastronomy. This science is all about manipulating our perceptions around the smell, taste, texture and other attributes of food. Places like Cafe Artscience in Cambridge, MA, embody this trend. Whether or not you plan to incorporate it into your menu, it’s worthwhile to understand how this trend will impact the way we think about food and the dining experience in general.

9. Prepayment for Meals

Many restaurants are beginning to experiment with allowing diners to prepay for their meals. This makes plenty of sense (and has been the norm for a few years) in grab-and-go takeout situations, but it’s now extending to in-restaurant experiences as well. As Forbes points out, asking people to pay for their tables ahead of time could definitely increase customer expectations, and -- if you fail to meet them -- lead to angry patrons.

Another concern exists around how this will affect tips. Will a fixed tip (à la Uber) simply get tacked onto the bill, much like it is in Europe?  Maybe so.

At any rate, it’s worth thinking about how this could potentially affect your relationship with your customers and your compensation structure.

10. The Internet of Kitchens

The Internet of Things as a trend has nearly reached fever pitch. But while there is a lot of hype around the topic, it has some basis in reality, and restaurants should take note. In addition to the technology at the point of sale, on the tables and in the customer’s pocket, high-tech gadgets are increasingly making their way into the kitchen itself. That includes sensors, which can help restaurants automatically keep tabs on important metrics like the temperature in their walk-ins.

When you start putting together your budget for 2015, it’s important to think about how much time, money and hassle can be saved when smart devices are put to use in restaurants -- especially behind the kitchen doors.

11. Getting Outside the Box

It’s not just customers’ taste buds that are evolving. Restaurant patrons are also increasingly interacting with food service establishments in new and unexpected ways. Food trucks have been all the rage for the last five years or so, but the trend toward dining “outside the walls” of a traditional restaurant doesn’t appear to be abating anytime soon.

Companies like Dinnerlab give the food service experience a whole new meaning by matching talented chefs with a group of customers keen on interaction, then throwing them together in an unexpected location (think: airplane hangar or abandoned church.) Other “out-of-store” restaurant experiences that are becoming the norm include food halls, pop-up restaurants, underground dinner clubs and more. This coming year is a great time to think about how you can expand revenue opportunities by looking outside your own walls.

12. Crowdsourcing

If catering to diners’ changing tastes and offering them meals outside your four walls sounds interesting to you, consider this new trend. Increasingly, restaurants aren’t just guessing about what consumers want. They’re crowdsourcing it, using technology to connect with their customers and find out exactly what it is they’re craving. While it might seem a little crazy on the outside to let your patrons take the wheel, there’s really no better way to ensure that you’re meeting the needs of your target audience. Of course, you don’t have to go whole-hog from day one. Start by crowdsourcing one or two seasonal menu items. It will make your customers happier and more connected to your restaurant, and help guarantee that you’re able to move certain items on the menu.  

13. Being Social

Many restaurants love to hate on the trend among diners to not just eat their food but photograph it. But let’s face it: iPhones and Instagram aren’t going away anytime soon, so you might as well embrace this behavior. And some restaurants already have, intentionally serving meals on picture-perfect plates and in well-lit settings so that people can grab that ideal, enticing image. While you don’t need to redo your whole aesthetic to appeal to the Pinterest generation, it’s worthwhile to consider how this type of behavior can actually benefit you in the long-run. (Hint: it’s free marketing.) Want to put a little juice behind it without spending a dime? Stick a hashtag in your menu. Or better yet: offer patrons a small percentage off their meal for taking a photo and tagging your restaurant. It’ll help spread the word in an organic and authentic way.

14. Competition from Retailers

This one might be a little unexpected for some restaurants. Bowing to competition from ecommerce, many brick-and-mortar retailers are beginning to offer food in-store. The thinking goes that the longer people spend in the store, the more they’ll buy. For district managers who operate restaurants near shopping areas, this could pose a real threat. Why would someone who’s already shopping in a department store leave to go to your restaurant when they can just stay where they are and dine? Well, they might ... if you offer food they want to eat, service they enjoy and the right mix of incentives. Especially during peak shopping season, consider offering a coupon or percentage off a meal for nearby shoppers, thus enticing them out of the store and through your doors. Otherwise, you may lose out to these nontraditional competitors.

15. Customization

Millennials are a large and growing constituency for many restaurants, and one that district managers need to keep in mind as they make decisions for 2015. Surveys have found that 21 percent of millennials expect their food to be customizable. So if you’re looking to appeal to this group, consider offering menu items that can be tailored to their specifications. For example, a “make your own” burger with various options for toppings can be a great way to make customers feel catered to without forcing your kitchen to become an army of short-order cooks. Check out this article for more tips on how to appeal to this generation.

What challenges are you expecting to tackle in 2015? Take our survey and let us know!

 

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