Chapter 23 - What of the Future?

More people will eat in restaurant | Types of food services operations | Location of restaurants | Number of restaurants | More pre-prepared portioned convenience foods | Faster better equipment | Automation | Centralize purchasing | Labor cost to increase | Imagination still at a premium

One thing we can be certain of regarding the restaurant business is that there will be a great many changes in the years to come. The exact changes no one can predict but it is relatively simple to identify trends and to assume that the trends will continue. What are some of the more discernible trends?

The population of the United States is growing at a rate of four million people a year. Population today exceeding 170 million is expected to easily reach 220 million by 1975. Here is a graph show­ing what can be expected in population through 1975.

The custom of dining out is an established part of our way of life. Twenty million of the working population are women, many of them married. Frequent restaurant meals for them and their families are a necessity.

We are a materialistic people. Eating out—once a luxury—is today considered by most of us as necessary. Domestic servants are expensive and few. Even for the higher middle class level it is much easier to eat out than to maintain a cook at home.

Large segments of the population have had income increases which permit them to eat out more often not only as a means of relaxation and escape from the monotonous chores of house keeping, but also as a form of pleasure and entertainment. Family income, even after taxes, is at an all time high of $5,300 and is expected to pass $7,000 by 1975. Individual savings are at a record level of $340 billion dollars. The value of meals eaten away from home (now approximately 17 billion dollars) is expected to reach well over 25 billion in the next 15 years.

Types of Food Service Operations

There is a definite trend toward 3 types of food service operations. The growth of fast, minimum service restaurants is apparent. Catering primarily to the shopper, young men and women employed in offices, retail outlets, these restaurants satisfy their customers need to save time and to obtain good food at moderate prices. Quick, self service is an established mode in this country. Most Americans have been well oriented to this pattern as evidenced by the rapid growth of super­markets, self-service drug stores and many other types of retail estab­lishments.

Not so evident is the rapidly growing combination motel-restaurant all over the country. Chains such as Interstate, Howard Johnson, Holiday Inn have in the last few years opened many of these units to the general public. Individual operators have started hundreds of motel-restaurant operations. As we become more and more a nation on wheels—travel more within the country and be away from home a greater part of the time, eating out will be a necessity.

The trend toward an open kitchen is exemplified here in Tad's Drive-ln, Jacksonville, Florida. All food preparations and even dishwashing is in plain view of the customers.

In this respect more travel by air has caused several well known companies to concentrate their attention on airport food service facil­ities. Even now the search for profitable airport food contracts has resulted, in instances where a two or three million dollar facility is being considered, to lease arrangements involving payments as high as 22% of the gross sales.

The third type operation that has and will continue to gain in popu­larity is the atmosphere restaurant. The "two dollar meal served in the five dollar atmosphere" is a good formula. Specialty restaurants such as Hawthornes' By The Sea in Massachusetts; Chardas Hungarian Res­taurant in New York City, atmosphere restaurants such as Creighton's in Fort Lauderdale; the Forum of the Twelve Caesars in New York City are growing in popularity and profitability. Eating out need not be merely an escape from routine housekeeping chores. Glamour, stimu­lation of all the senses, excitement, a feeling of satisfaction and well being are all part of the package that a good atmosphere restaurant sells in addition to food.

Location of Restaurants

The standard quick lunch operation will undoubtedly continue to locate in areas where traffic is heavy. Atmosphere restaurants on the other hand can locate in any area and create their own traffic. Many restaurants of all kinds are gradually moving from downtown districts to the edge of cities, to accommodate new shopping centers and suburbs. The importance of location will increase, especially since higher investments will be needed to attract patrons.

Restaurants on Super Highways are now big business, with lessees bidding as much as 22 percent of the gross income for the right to operate on the super highways, controlled by various state authorities. Cafeterias—contrary to the predictions of some experts—are among those restaurants that have discovered the suburbs to be good locations. Shopping center restaurants—usually of the quick service type—are doing well. Of course, downtown areas will still provide sound loca­tions for many restaurants, particularly those emphasizing luncheon business. Plenty of parking is the major factor in the movement to the suburbs.

Number of Restaurants

The number of restaurants may well diminish. Atmosphere restau­rants call for heavy investment and force out of business the smaller, less exciting restaurant. Since more money will be needed to start a restaurant, the thousands who formerly could start on a shoestring will be kept out. The big chains are likely to grow larger. Some will specialize in super highway feeding. One, The Interstate Company, a company with its antecedents in railway feeding in the 1890's, has concentrated on airport food sales and has contracts for the Los Angeles, San Francisco, New Orleans, and other airports.

More Pre-prepared, Portioned, Convenience Foods

Undoubtedly restaurants will purchase more foods that have been partially prepared in some way—pre-cut meats; portion-size packages of crackers, jellies, catsup; pre-cut, blanched potatoes—the list grows daily. Where specialized skills can be put to work using specialized machinery, pre-prepared food should cost less to the restaurant opera­tor. This is not always proved true. One reason is that some parts of the country with cheap labor can do the pre-preparation work at a lesser cost than can the pre-fabricator using specialized labor and equipment but paying high wages.

Prefabricated meat is an item which will come in for careful study of costs as compared with purchase in carcass or retail cut form.

The do-it-yourself trend is much a part of today's restaurant. Here a customer selects his own steak and brands it. The steak is not any better for this treatment but the customer feels better in that he has had an active part in the selection and preparation of his food.

In 1957 the U.S. Army did an extensive study of costs of fabricating its own meat. The costs averaged 3 cents a pound. They were able to get a 70% yield of meat on carcass purchases and to save over 8 mil lion in 1957 in purchases of meat. Restaurant chains have found a cost advantage in doing much of their own food processing. Firms like Hot Shoppes make their soup stock, sauces, prepare their own potatoes using lye and steam cleaning, and prepare many other items.

Centralized pre-preparation of foods by chains and institutional food service is almost certain to grow. Centralized food preparation in hospitals, school lunch programs, and in chain restaurants usually results in a savings over preparation in each unit of the organization. In small chains, one restaurant may prepare all hamburger patties for the chain, another may cut and blanch all french fries, still another may do all of the baking.

More use of dehydrated foods is certain to come but these are lim­ited to what the customer will accept. Dehydrated potatoes are well accepted for mashed potatoes and dehydrated onions are acceptable for prepared dishes. On the other hand, dehydrated steaks, chicken, peas, orange juice and tomato juice are not accepted and will prob­ably not be used in commercial restaurants in the near future.

Foods that are drastically changed in appearance or taste are likely to be used only under special circumstances such as under combat conditions and high altitude and space travel.

Frozen meals sold at supermarkets will be improved in quality and variety. With the microwave ovens which will be in many homes, these meals can be re-heated or "reconstituted" in a matter of seconds. Still the glamour of eating in an attractive restaurant will overcome the economy and ease of eating at home and permit the restaurant business to grow.

Faster, Better Equipment

Microwave cookery is certain to increase in use because of its speed, cleanliness and its relative ease of use. Restaurant personnel like it because of the minimum labor needed to operate it and keep it clean. The absence of wild heat from a microwave oven is also a big advan­tage. It does not appear, however, that microwave ovens will replace gas or electric ovens for volume food production.

Dishwashing progress «is due for a big change. At present the peg or flight type of machine is the most efficient, but it is considered rela­tively costly for the moderate or small size of restaurant. This type of machine requires the least space for the volume of tableware that it will wash and if operated properly will decrease labor cost in the dishroom. The continuous conveyor belt using racks—the so called merry-go-round belt—will probably find wide use in the average restaurant. Cold water sterilization using a form of iodine as a bactericide or washing by sound waves may be practical before long. Cold water glass washers are now practical, save space and labor. The emphasis is on speed in cookery. Steam under 15 pounds of pressure presents a fast method of cooking. The broaster—a pressurized deep fat fryer cuts frying time in less than half. New equipment permits the use of dry heat for browning, steam for fast processing.

Stainless steel of the 18-8 type (8% nickel) grows in popularity so that it is specified for many parts of kitchen equipment where it is not necessary. All stainless steel refrigerators, for example, are 20-30 per­cent more expensive than aluminum refrigerators with stainless steel fronts. The aluminum type does everything that stainless steel can do except that the aluminum is softer, and scratches easier.

Automation

The time for complete automation-machines running machines— seems some years away for the restaurant except where utility is all-important. Face to face service by people is still important. Vending machine cafeterias are already in use, will probably become more wide­spread, especially in institutional feeding. The mechanically operated restaurant is a possibility even now—but will probably never replace waiter-waitress service, at least in luxury dining out.

Centralized Purchasing

Mass purchasing gives a five percent or greater advantage to the buyer. Chain operations have this tremendous advantage over the individual operator. To offset this buying advantage, individual opera­tors are like to form corporative buying associations as has been done by a group of Chicago restaurateurs. These operators have their full time buyer and a large warehouse.

Centralized warehousing seems to be declining, giving way to con­tract buying, by terms of which restaurant operators buy in large quantities but have the items delivered to the restaurant as needed. Contract buying with delivery as needed is especially valuable with seafood items, canned goods which vary in price and require expensive storage facilities.

Labor Cost to Increase

Biggest problem in successful restaurants, say two out of three operators, is rising labor costs. In a nationwide survey of restaurants made in 1957, Food Service Magazine found labor cost had increased tremendously.

Only the cafeteria was able to reduce labor cost in the decade covered by the study, and the decrease was but one percent. This is significant because the cafeteria represents the self-service trend that has already changed grocery retailing from the small grocery to the large self-service super market. On the West Coast, labor costs in most restau­rants approach 40 percent of the sales dollar and many restaurant operators have changed to self-service. Walk-up drive-ins, where the customer gets out of his car and picks up his order at a window, is part of the trend to reducing labor costs by self-service.

In spite of the trends to self-service, better scheduling and training, better layouts and other factors, the projection of increased labor costs per hour is a certainty in the future.

Increased governmental regulations, changes in the various tax laws pertaining to payroll, the steady growth of unions and their demands for higher wages, 30 hour work week, longer and more vacations, all point to a minimum increase of about two percent a year. Labor cost as a percentage of sales may well level off at about 40 percent. Increases in wages per hour may be partially or wholly offset by use of fewer employees selected to do a much better job in a well designed restaurant utilizing highly productive, labor saving equipment.

Imagination Still at a Premium

Restaurant operation will always reward the imaginative, persever­ing operator who has good business judgment. As working hours are reduced and life becomes more secure economically for the average person, that average person will want stimulation and excitement, escape from routine. The restaurant can give him this, not only in the food he can expect, but in the decor, design, and service. He can take a fast trip to foreign and exotic lands via a Polynesian restaurant, or ex­perience a different taste thrill by trying a Polish dish, be pleasantly excited by a waterfall, lights and color of a modern restaurant—all for the cost of a meal. Volume food service will be upgraded by garnished, well seasoned dishes, beautifully presented. Luxury food service will stress a theme as is done by the Four Seasons in New York Cky. Fast food operators will become faster. The restaurant business will become a field for experts.

Are You Ready To Move Onto The Next Lesson? Click Here...