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Restaurant Purchasing Report 2019 – Over 550 Independent Operators Share Their Experience and Insights Regarding Purchasing

PHOENIX, Ariz. -- RestaurantOwner.com has published the report of their 2019 Restaurant Purchasing Survey. This report focuses on restaurant purchasing, summarizing input from over 550 independent operators regarding their purchasing, including where operators purchase, involvement in group purchasing organizations (GPOs), the prevalence and benefits of prime vendor relationships, and the rationale and satisfaction with prime vendors.

A copy of the report is available at: https://www.restaurantowner.com/RPS2019

Survey Results:
Despite the purchasing power of GPOs, only 9% of responding operators are part of one. Four GPOs accounted for 67% of those named by respondents: Dining Alliance (23%), Delaware Valley Purchasing Group (19%), Foodbuy (14%) and Entegra (12%).

Unlike GPO involvement, most (78%) operators have a prime vendor relationship or distributor from which they purchase most of their food, beverage, and paper products. The benefits are many, but more than 75% of respondents cite better service, simplicity of fewer vendors, improved relationship with sales representatives, and feeling that a vendor genuinely supported their restaurant's success as benefits of such a relationship.

Forty-five broadline suppliers were named by respondents, yet only five suppliers serve as the primary supplier for 90% of respondents: Sysco (34%), US Foods (23%), Gordon (13%), Performance Food Group (12%), and Ben E. Keith (8%).

Most (84%) operators are satisfied with their prime vendor. This satisfaction is evident in the length of these relationships, with most (52%) operators having worked with a prime vendor for more than 5 years.

Even with the benefits of a prime vendor, nearly a quarter (22%) of operators did not have such a relationship. Almost half (49%) of operators without a prime vendor report that they prefer to work with multiple distributors and suppliers. Additional insights and quotes from operators are included in the 2019 Restaurant Purchasing Survey Report.

About RestaurantOwner.com:

Since 1998, RestaurantOwner.com has provided training and resources to independent restaurant owners and managers who want to improve their leadership and business management skills to create a higher quality guest experience, greater employee engagement and better financial results.

More information: https://www.restaurantowner.com/.

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*Image Caption: page six example from the comprehensive 2019 report.

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Restaurant Delivery Report – Nearly 1,000 Independent Restaurant Operators Share Profitability and Challenges with Delivery

PHOENIX, Ariz. -- RestaurantOwner.com's published results of their 2019 Restaurant Delivery Survey focuses on the growing trend of restaurant delivery and summarizes input gathered from nearly 1,000 independent restaurant owners and operators regarding their experiences with self-delivery and third-party service providers, and their insights regarding restaurant delivery.

This report is available at: https://www.restaurantowner.com/RDS2019

Survey Results:
Restaurant delivery has become available in most independent restaurants, with 57% of operators offering some form of delivery. Moreover, 16% of the operators without delivery plan to add the service within a year. Of operators who offered delivery, 31% used only third-party services, 12% operated in-house delivery services, and 14% relied on both third-party and their own service. DoorDash (47%), UberEats (44%), and GrubHub (40%) are the top three third-party delivery services used in independent restaurants.

The majority of urban (67%) and suburban (57%) independent restaurants offered delivery, whereas most restaurants located in rural (70%) or resort/tourist destinations (71%) did not.

Profitability continues to be a concern for operators considering delivery. Most operators (86%) reported that delivery was profitable, and sales from delivery orders are growing, with operators reporting delivery sales growth from 9% three years ago to 16% of sales today.

Most operators (67%) were satisfied with their third-party delivery service. Of operators who weren't, 26% cited the high commission fees as the cause of their dissatisfaction. These fees ranged from 21-30% of the sale for most operators who contracted with a third-party delivery service.

"Delivery is not without challenges. Incorrect orders, too many third-party providers, and long delivery times were challenges for more than 70% of operators," said CEO Jim Laube.

Operators also shared that the lack of access to guest information when using many third-party delivery services was a problem. Other challenges and direct quotes from operators appear in the 2019 Restaurant Delivery Survey Report.

About RestaurantOwner.com:
Since 1998, RestaurantOwner.com has provided training and resources to independent restaurant owners and managers who want to improve their leadership and business management skills to create a higher quality guest experience, greater employee engagement and better financial results.

Information: https://www.restaurantowner.com/.

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Restaurant Results and Outlook Survey: Over 700 Independent Operators Share Their 2018 Results and Plans for 2019

PHOENIX, Ariz. -- RestaurantOwner.com has released the report of their 2019 Independent Restaurant Outlook Survey. This is the third consecutive Outlook Report which summarizes input gathered from over 700 independent restaurant owners and operators regarding their 2018 financial performance, as well as their optimism about 2019.

A copy of the report is available at: https://www.restaurantowner.com/IROS2019

Survey Results:
2018 was another profitable year for most independent restaurants. 81% of the 707 responding owners or operators reported a net income greater than 1% of sales in 2018, of which, 30% reported a net income greater than 10%. Of those that were not profitable, approximately 10% broke even, while 9% reported a net loss greater than 1% of sales.

Profitability continued to rise as many independent restaurants performed better in 2018 than the previous year. 64% of respondents reported that their net income in 2018 outpaced their 2017 performance. 17% reported no change and 22% reported a lower net income in 2018 compared to the previous year, indicating a continued upward trend in independent restaurant performance.

Optimism prevailed for a third year in a row. 62% of respondents indicated they are more optimistic about 2019 than they were about 2018. This trend continues from last year where 64% of respondents felt more optimistic about 2018 compared to 2017.

Most operators attributed their optimism for 2019 to improved business practices or systems (73%), and a quality guest experience (53%). Staffing challenges (53%) and unfavorable labor costs (52%) were the most cited causes for lacking optimism.

Again, the results of the survey confirm a strong and continuing interest of independent restaurant owners and operators to improve and grow their business. Many operators (84%) intend to pursue four or more goals in 2019. Over 60% of respondents reported they intend to focus on improving overall profitability, business practices, or their guest experience.

About RestaurantOwner.com:
Since 1998, RestaurantOwner.com has provided training and resources to independent restaurant owners and managers who want to improve their leadership and business management skills to create a higher quality guest experience, greater employee engagement and better financial results.

More information: https://www.restaurantowner.com/.

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How Much Does It Cost to Open a Restaurant? 350 Independent Restaurant Owners Share Their 2018 Startup Costs and Financial Performance

PHOENIX, Ariz. -- RestaurantOwner.com has released the report of their 2018 Cost to Open a Restaurant Survey. The report summarizes input gathered from over 350 independent restaurant owners and operators regarding their startup costs as well as their financial performance.

A copy of the survey report is available at: https://www.restaurantowner.com/public/How-Much-Does-it-Cost-to-Open-a-Restaurant.cfm

The median restaurant startup cost was $375,000. This equates to a median cost of $113 per square foot, or $3,586 per seat. Many factors affected cost including remodel vs. new construction, free standing building vs. tenant space, and whether the restaurant was full service, limited service, bar or tavern, catering business, or takeout and delivery.

"New construction was more costly than remodeling. The median cost of building a restaurant from the ground up, not including real estate, was $650,000," said COO Joe Erickson.

Remodeling a non-restaurant space was the second most costly, with a median cost of $425,500. Remodeling an existing restaurant space was the least costly, with a median cost of $275,500. Consequently, the median sales to investment ratio was highest for remodeling an existing restaurant space (4.2:1), versus either remodeling a non-restaurant space (2.1:1) or new construction (2.0:1).

The median size of restaurant startups was 3,070 square feet, and 120 seats. This size resulted in a median of 31 square feet per seat. Kitchens occupied about 31% of the restaurant space, with a median size of 1,000 square feet.

The median annual sales across all service types was $1.125 million. That financial performance resulted in a median annual revenue of $325 per square foot, or $10,567 per seat. Median time to profitability was 5 months. 25% of owners reported that their restaurant was profitable within the first 2 months and another 25% took 12 months to become profitable. The median net income reported was 5.5%.

About RestaurantOwner.com:
RestaurantOwner.com provides leadership, financial management and operational training and resources to independent restaurant owners and managers to improve the guest experience, employee engagement and achieve better financial results.

More information: https://www.restaurantowner.com/.

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*Image Caption: page three example from the comprehensive 2018 report.

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Profitability in 2017 and Optimism in 2018: Over 880 U.S. Independent Restaurant Owners Voice Their Thoughts on 2018

PHOENIX, Ariz. -- RestaurantOwner.com has released the report of their 2018 Independent Restaurant Outlook Survey. The report summarizes input gathered from over 880 independent restaurant owners and operators regarding their 2017 financial performance as well as their 2018 expectations.

A copy of the survey report is available at: https://www.restaurantowner.com/public/2018-Independent-Restaurant-Outlook-Survey-Report.cfm

Survey Results:
2017 was a profitable year for independent restaurants. 79% of the 882 responding independent restaurant owners or operators reported a net income greater than 1% of sales in 2017, of which, 31% reported a net income greater than 10%. Of those that were not profitable, approximately 10% broke even, while 11% reported a net loss greater than 1% of sales.

Profitability is on the rise as many independent restaurants performed better in 2017 than the previous year. 62% of respondents reported that their net income in 2017 outpaced their 2016 net income. Only 16% reported no change, and 22% reported lower net income in 2017 compared to 2016, indicating an overall upward trend in performance.

Independent restaurant operators are optimistic about 2018, and their optimism is trending upward. 65% of respondents indicated they are more optimistic about 2018 than they were about 2017. This is up from last year's survey results where only 56% of respondents felt more optimistic about 2017 compared to 2016.

For operators who are optimistic, over half (68%) attributed their optimism to improved business practices or systems. Over half (61%) of those who are not optimistic attributed it to challenging labors costs.

Independent restaurant operator goals reflect their optimism for 2018. Most (82%) identified four or more goals, indicating a desire to improve and grow in the new year. Over 50% of respondents reported they intend to focus on improving profitability, business practices, guest experience, or staff training, or that they are going to reduce their costs in 2018.

About RestaurantOwner.com:
Since 1998, RestaurantOwner.com has provided proven resources to independent restaurant owners and managers who want to improve their leadership and business management skills to create a more consistent, higher quality guest experience, greater employee engagement and better financial results.

More information: https://www.restaurantowner.com/.

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*Image Caption: page three example from the comprehensive 2018 report.

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Now Hiring: Over 400 Independent Restaurant Owners Share What They do to Recruit their Best Employees

PHOENIX, Ariz. -- RestaurantOwner (RestaurantOwner.com) today released the results of their 2017 Independent Restaurant Recruiting Survey. The report summarizes input gathered from over 400 independent restaurant owners and operators regarding their proven recruiting practices.

A copy of the report is available at: https://www.restaurantowner.com/Recruiting2017/.

Survey Results:
The days of the Help Wanted sign are numbered. Only a third (34%) of independent restaurant owners reported using signs placed in their restaurant to announce job openings. Instead, resourceful restauranteurs are turning to technology in their search for new talent, with 57% indicating that they use internet classifieds, 56% social networks, and 44% internet job sites in their search for new talent.

Despite technology-based solutions, word-of-mouth is still the best recruiting tool. An overwhelming majority (86%) of independent restaurant operators rely on employee referrals to find new team members. And when asked where they found the best employees, 48% responded with employee referrals.

Surprisingly, only 26% of respondents had a formal referral program. For independent restaurants that rewarded successful candidate referrals, employees typically earned $100 per referral once a referred candidate was employed for 90 days.

A positive restaurant culture (48%) was the most cited response to, "What's the #1 reason people want to work in your restaurant?" Culture was more important than a desirable schedule (8%), the need for a job (10%), and even good pay/benefits (22%). Despite this, only 39% of respondents included information about their restaurant culture in job postings.

The two most cited hurdles currently faced by independent restaurant operators are a lack of qualified applicants (78%) and competition for employees (44%). Savvy restaurateurs shared that they overcame these hurdles with continuous recruiting, employee referrals, and by actively recruiting the employed.

Additional insights, graphs, figures, and statistics are included in the report.

About Restaurant Owner:
With over 46,000 members since 1998, RestaurantOwner.com's mission is to change lives by educating and inspiring independent restaurant owner operators to create restaurant success stories. It's committed to providing practical, proven insights, and resources to enable members to build a better restaurant, a better business, and most importantly, a better life.

Information: https://www.restaurantowner.com/.

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*Image Caption: A selected metric from the RestaurantOwner 2017 Recruiting Survey Report.

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Boom or Bust? Over 500 Independent Restaurant Owners Voice Their Thoughts on 2017

PHOENIX, Ariz. -- RestaurantOwner.com released the results of their 2017 Independent Restaurant Outlook Survey. The results summarize input gathered from over 500 independent restaurant owners regarding their restaurant outlook for 2017. The results indicate independent restaurant owners are optimistic about 2017, a theme supported by a majority who plan to grow and invest in their restaurant business in 2017.

A copy of the survey results is available at: http://www.restaurantowner.com/Outlook2017/.

Survey Results:
Independent restaurant owners are optimistic about 2017. 56% of respondents indicated they are more optimistic now than this time last year. 27% report they feel about the same, and only 17% indicate that they are less optimistic.

For those who report feeling optimistic, over half (51%) attribute it to improved business practices or systems. Interestingly, respondents tended to attribute their optimism to either internal factors (high quality staff, quality of the guest experience, labor costs, improved business practices or systems) or external factors (improving economic conditions, the positive impact of new government policies).

Of those who were not optimistic, over half (55%) attribute their outlook to higher labors costs. Responses tended to cluster into one of three concerns: staffing (high labor costs, staffing challenges), management (quality of our guest experience, lack of effective business practices or systems), or economic (stagnant or worsening economic conditions, negative impact of new governmental policies).

The goals and objectives independent restaurant owners are going to pursue in 2017 reflect optimism. Most (94%) indicate they have two or more goals for 2017. Plans to improve overall profitability, improve staffing, improve internal systems or business practices, or reduce costs were each endorsed by over half of respondents.

Independent restaurant owners' plans for 2017 reflect their optimism. 83% have plans that reflect investing in or growing their restaurant business. Just under half (48%) have plans to make physical improvements.

About RestaurantOwner.com:
With over 46,000 members since 1998, RestaurantOwner.com's mission is to change lives by educating and inspiring independent restaurant operators to create restaurant success stories. RestaurantOwner.com is committed to providing practical, proven insights, and resources to enable members to build a better restaurant, a better business, and most importantly, a better life.

More information: http://www.restaurantowner.com/.

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