Tech vs. People

Sep 27, 2022 | Corporate Insights, No Bull Economics


Par Tech recently reported that when covid hit in 2020, 13% of its restaurant client base (operators in large brand systems) closed & half re-opened 6 weeks later. This compares with its restaurant tech competitors that sell to smaller mom & pop restaurants which saw a 50% closure rate as of week 6.

This is testimony to the power of large restaurant brands and the benefit of scale as it relates to financing, marketing, management depth, tech infrastructure, and supply chain. These results are notable as Par Tech points out that even the large restaurant brands have not progressed in tech as much as would be expected. While there were a few large retailers that didn’t have e-commerce stores by 2020, McDonald’s customers couldn’t place digital orders until 2021.      

Certainly, the large brands initially benefitted from share gains at the expense of those mom & pops that didn’t make it. But what is notable in the chart below is how the independents quickly recovered & continued their long-term share gain trend at the expense of the big chains in 2021. 

The reality is that the restaurant business is still a people business and small operators can compete and win by providing best-in-class customer service, ingenuity, and home-grown market strategies that only local owners can provide. The restaurant industry is plenty big enough for both the large brands and mom & pop restauranteurs, and it is a snare for business owners big or small to think that tech has eclipsed people skills – never going to happen…

Industry Market Share Graph

Follow us on LinkedInTwitterFacebook, and YouTube!

Disclaimer of Liability
No Bull Economics
Restaurant Research

Email Sign-up

Jack in the Box Corporate Insights

Jack in the Box results reflected an improvement in: dining room openings (60% of system); innovation, upsell & add-ons sales; digital progress which is helping frequency; and late-night.

How to Circumvent Food Shortages?

The vulnerabilities of a long-distance supply chain have become very evident over the last couple of years, especially when it comes to farming.

This Week in Summary 11/18/2022

We want to spotlight Target this week which provides valuable insight on consumer spending.

How Would You Value the Federal Reserve?

Here is an idea: let’s take the Federal Reserve public in the world’s largest IPO.

How to Pass Along Inflationary Costs Without Losing Traffic?

Wendy’s is avoiding standardized menu price increases and turning to strategic increases designed not to price out lower income consumers.

Investors in Retail Stocks Think Consumers are Back

Recent retail stock gains would suggest that investors are confident in consumer strength, despite continuing inflationary issues.

Papa John’s & Chili’s Reveal the Plight of Cash Strapped Consumers

The relevant question remains whether consumers who are increasingly cash-strapped can be convinced to pay more for higher quality levels?

This Week in Summary 11/11/2022

Market melt up & the midterm elections

DoorDash’s Grip on Labor Costs is Funding New Investments

Doordash’s platform generated +10% of all restaurant industry sales.

3Q Results for Bloomin’, Texas Roadhouse & Cheesecake

Full serve restaurant sales performance is currently a function of customer demographics.

Digital Marketing Opportunities
Restaurant Research

A Restaurant Research LLC Company