Restaurant And Hospitality News – July 6, 2015
By Christine Kern, contributing writer
In news this week, the latest Restaurant Performance Index numbers are out, and Obama’s Overtime Pay Proposal has many in the restaurant industry concerned. Papa John’s has also jumped on the clean ingredients bandwagon, and TrustYou’s new report demonstrates which hotel attributes have the largest impact on traveler bookings.
Although NRA Restaurant Performance Dips In May, Operators Remain Optimistic
The latest Restaurant Performance Index from the National Restaurant Association dipped to 102.3 in May, a 0.4 percent decrease from 102.7 in April. It did, however, represent the 27th consecutive month in which the RPI was above 100, marking industry expansion according to the NRA. “The outlook for the restaurant industry remains positive,” Hudson Riehle, senior vice president of the research and knowledge group at the NRA, said in a statement. “A majority of restaurant operators reported higher same-store sales in May, and operators are generally optimistic about an improving business environment in the months ahead.” And the research found that operators are still spending money to expand, with 54 percent of operators anticipating making a capital expenditure for equipment, expansion or remodeling in the next six months, slightly lower than the 59 percent who reported the same in April.
How Will Obama’s Overtime Pay Proposal Affect The Restaurant Industry?
President Obama announced a new overtime pay proposal in a blog on the Huffington Post, stating that the threshold for overtime pay would increase from $455 a week, or $23,600 a year, to $970 per week, or $50,440 per year. That means that nearly 5 million additional workers would be eligible for pay 1.5 times their hourly rate for all hours worked above 40 hours per week, and Obama said that the rule could be in place by next year. “That’s good for workers who want fair pay, and it’s good for business owners who are already paying their employees what they deserve — since those who are doing right by their employees are undercut by competitors who aren’t,” Obama wrote. But what impact will this have on the restaurant industry? According to the Nation’s Restaurant News, the industry has expressed concerns over the potential changes since Obama asked the US Department of Labor to propose revised regulations in March of 2014. One spokesman for Culver’s told the Nation’s Restaurant News that while the chain is still studying the regulation, “it will likely increase our labor dollars to get the same coverage.” And industry trade groups have also expressed opposition to the rules. Angelo Amador, senior vice president of labor and workforce policy and regulatory counsel for the National Restaurant Association said in a statement that, “Supporters of these regulations say they want to increase Americans’ take-home pay, but these sweeping changes to the rules could mean anything but. More than 80 percent of restaurant owners and 97 percent of restaurant managers start their careers in non-managerial positions and move up with new performance-based incentives. If these regulations stand, that mobility and adaptability of employee schedules, which makes our industry appealing, will be severely diminished.”
Papa John’s Promises Clean Ingredients In New Campaign
Papa John’s International Inc., known for its slogan “Better Ingredients. Better Pizza.” Has launched a new initiative that promises clean ingredients and also promises to remove all artificial ingredients from its menu, according to the Nation’s Restaurant News. As part of the initiative, Papa John’s has launched a new website, stating “we are continually working to use only the highest quality ingredients and removing as many unwanted ingredients as we can.” The website includes a chart that lists the status of the work done by Papa John’s and other brands to eliminate artificial ingredients from the food they serve. According to the site, which compares its actions to those of Panera Bread and Chipotle Mexican Grill, Papa John’s has already eliminated 65 unwanted ingredients, with 24 unwanted ingredients still found in their products. By 2016, Papa Johns has committed to removing an additional 14 unwanted ingredients. The ingredients to be removed include artificial flavors and colors, corn syrup and corn syrup solids, hydrolyzed soy protein and corn protein, and sodium benzoate. Papa John’s has already removed trans fats, monosodium glutamate, and the preservatives BHA and BHT from its menu.
TrustYou Report Reveals Attributes That Lead To Traveler Bookings
In a new report, TrustYou, the inventor of the Meta-Review and global online reputation management specialist, together with Donna Qaudri-Felitti, Director of the School of Hospitality Management at the Pennsylvania State University, found that the booking process is loaded with complexities. The study was designed to understand which hotel attributes have the largest impact on travelers’ booking decisions. “Hotels must understand what travelers want and need in a hotel when making their booking decisions,” says Quadri-Felitti. “These self-reported important attributes like cleanliness and comfort are required for a hotel to be a part of a traveler’s consideration set. Once a hotel becomes part of the traveler’s consideration set by delivering on the “must haves,” it can then focus on attributes that actually trigger a traveler to book.” Significant attributes include Wi-Fi for business travelers, food for those traveling socially with friends, rooms for those booking romantic vacations, and room, comfort and amenities for family travelers. “The attributes that influence travelers to book a hotel are closely tied to the context in which the person is traveling. For example, a hotel with great Wi-Fi is a trigger for business travelers, while great food is important for those traveling with their friends,” adds Margaret Ady, Vice President of Marketing at TrustYou. “By understanding these triggers, hotels can focus efforts to improve, optimize marketing, and leverage review content to best cater to its audience and ultimately increase bookings.”