How Does the 2024 Datassential 500 Shake Out?
David Klemt
Partner, KRG Hospitality Inc. | Bar, Beverage and Guest Experience Coach | IHI 2024 Global Top 100 Social Media Influencers in Hospitality | Host of Bar Hacks, IHI 2024 Global Top 40 Hospitality Podcasts
The annual Datassential 500 ranking is a valuable report that identifies industry leaders, the fastest growers, and segment performance.
Further, this yearly report shows the scale of restaurant business in the US. In a word, it’s gargantuan.
Looking at 2023 data, the top 500 chains in the US operated 238,152 units. And those 238,000-plus restaurants generated $417.13 billion in 2023.
For the former, that’s growth of 2.1 percent in comparison to 2022. And for the latter, the top 500 grew by 7.5 percent compared to last year.
Those numbers are from just 500 chains; the report doesn’t take into account other chains or independent operators. When we add all dining and drinking establishments in the US, the industry generated $1.09 trillion in 2023.
Again, the US restaurant business is a colossus.
Perhaps unsurprisingly, limited-service and quick-service restaurants are the top-performing segments by unit within the Datassential 500. In 2023, the LSR segment consisted of 212,469, and unit growth was up by 2.3 percent. The QSR segment reached 170,241, representing unit growth of 1.9 percent.
In fact, every segment but one saw unit growth in 2023. One may assume the segment that slipped was fine dining. That’s usually a safe bet, but the segment actually saw the most growth. It was midscale restaurants that suffered a bit of a blow, shrinking by 0.1 percent.
That means that LSRs, QSRs, full-service restaurants (FSRs), fast casual, casual dining, and fine dining all grew. Further, that growth ranged from 0.3 percent (FSR) to 4.6 percent (fine dining).
There are many more insights, so I encourage anyone interested to download the report for themselves.
Segment Shakedown
Before we jump into the top US chains, let’s take a look at how the categories break down.
Type of Cuisine
Growth by Segment: Unit (LSR)
As we can see, Salad/Healthy LSRs saw almost double the growth by unit than the next-largest segment, Coffee.
Further, Sandwich and Burger shrunk slightly.
Growth by Segment: Unit (FSR)
Regional and ethnic full-size restaurants saw the most growth. In fact, they grew by twice the amount of sports bars, and several times more than midscale FSRs.
For many more insights into the Datassential 500 (and industry as a whole), click here.
Modern Day Revenue Management for Hotels
written by Doug Radkey
The landscape of hotel revenue management has evolved significantly in recent years, driven by both tech advancements and changing consumer behaviors.
With this in mind, I think now would be a good time to explore these current trends, tools, and strategies in hotel revenue management.
Below, I outline the importance of data analytics, dynamic pricing, and AI in maximizing revenue today, and as we move forward in this industry.
The Evolution of Revenue Management
In the early days of the hotel industry, revenue management was a relatively straightforward affair.
While the overall concept of revenue management originated in the airline industry in the 1980s, it was later adapted by hotels. Traditional practices relied primarily on static pricing models, where room rates were set based on the season, room type, and booking lead time. Rates were adjusted infrequently (often just a few times per year), and they were influenced mainly by historical data documented internally, and the intuition of revenue managers.
Hotels used simple tools such as spreadsheets and reservation logs to track bookings and manage their inventory. The focus was on achieving high occupancy rates rather than maximizing revenue per available room (RevPAR) and the other key metrics that we follow today.
Discounts and promotions were applied sporadically, without a deep understanding of market segments or consumer behavior, to help drive revenue during off-season periods. Group rates and corporate contracts were negotiated based on fixed rates, with little consideration for fluctuating market conditions.
From Static Pricing to Dynamic, Data-Driven Strategies
The transition from those early days to modern revenue management practices began in the late 1990s and early 2000s, driven by tech advancements and increased competition in the accommodation space.
The advent of online travel agencies (OTAs), real-time booking systems, and sophisticated data analytic tools transformed how hotels approached their pricing and inventory management.
So, what’s the modern approach?
The Importance of Data Analytics
Data analytics involves the systematic analysis of data to uncover patterns, correlations, and trends that inform strategic decisions.
Sounds fairly important, right? In the hospitality industry, data analytics helps you understand market dynamics, predict demand, and tailor your hotel’s offering to meet guest needs. This level of analysis is paramount for developing effective revenue management strategies that maximize profitability.
One of the primary functions of data analytics in hotel revenue management is demand forecasting. By analyzing historical booking data, seasonal trends, and external factors such as local events, weather, or economic conditions, hotels can predict future demand accurately. This forecasting through data analytics enables hotels to adjust room rates more dynamically, optimize inventory allocation more efficiently, and implement targeted marketing campaigns that drive results.
Modern analytics platforms have revolutionized hotel revenue management by providing sophisticated tools for data analysis, strategic planning, and dynamic pricing. Atomize RMS stands out as a prime example of an advanced analytics tool that leverages data-driven decision-making to optimize hotel performance through dynamic pricing. This cloud-based revenue management system (RMS) uses sophisticated algorithms and machine learning to provide real-time pricing recommendations, as well as market insights.
Atomize enables hotels to make informed decisions based on real-time market conditions and predictive analytics by leveraging machine learning and big data. This data-driven approach leads to more precise pricing strategies, optimized inventory management, and improved profitability.
Moreover, the system’s ability to automate and streamline revenue management processes reduces the risk of human error, and frees up time for hotel staff to focus on other critical aspects of operations, such as providing a memorable guest experience, and elevating service quality.
For many more insights, continue reading on KRGHospitality.com.
How do You Measure Success?
When you take a moment to reflect on your business, what does success mean to you, and what steps are you taking to achieve it?
One obvious measure of success, of course, is monetary. Whether you operate a bar, restaurant, cafe, lounge, nightclub, hotel or other hospitality business, this is a stressful business. Why subject yourself and your team to the hardships hospitality throws at us if there are no financial rewards?
To many, a successful business is one that operates a profit. One that provides the entire team with not just enough money to get by but to thrive and experience financial freedom.
I like to think that most—the vast majority would be nice—operators want the people who believe in their vision enough to work with them to achieve it to make more than just a living wage.
Speaking of buy-in from others, finding people eager to work for them is a measure of success to some operators.
Others find success in achieving accolades. If we were to look at these operators and those who measure success financially, there would surely be an overlap in a Venn diagram.
Operators who find awards, invitations to share their stories, and opportunities to speak and educate others find the validation of their vision to mean they’re successful.
There’s absolutely nothing wrong with measuring success by profits and awards earned. After all, a hospitality business won’t be a business for long if it operates in the red, or people are unaware it exists.
But what about considering how your business makes you feel?
领英推荐
For Your Condsideration
Yes, I’m going to talk about feelings. Our industry is too challenging to pretend money is the only thing that matters. And we simply can’t keep ignoring the topic of mental health and the toll the hospitality industry can take on a person.
So, let’s take a moment to consider some key questions.
Is just the thought of your business accompanied by positive or negative feelings? When it’s time to head into your restaurant, bar or hotel, are you happy and excited? Or does the thought fill you with stress, or worse yet, dread?
I’m speaking on balance, of course. Stress is inescapable. New operator? Stress. A year or two in? Stress. Veteran operator? Stress.
On the whole, however, do you feel satisfied with what you’ve built, and what you’re operating? When you consider your business and brand, are you proud?
Continue reading on KRGHospitality.com.
Menu Design: Balancing Creativity and Guest Preferences
written by Nathen Dube, RSE
A menu is not just a list of dishes; it’s a strategic tool that influences guest choices, enhances the dining experience, and maximizes sales.
Therefore, a well-designed menu is a crucial component of a restaurant’s success.
Come along with me and we’ll explore the principles of effective menu design, balancing creativity with guest preferences, and the role of menu psychology in driving decisions.
Key Principles of Effective Menu Design
Layout and Structure
The foundation of a great menu lies in its layout and structure. Organizing menu items logically—grouping appetizers, mains, desserts, and beverages into distinct sections—guides guests through their dining journey.
This structure helps in creating a seamless experience where guests can find what they are looking for easily. Subsections like “vegetarian,” “seafood,” or “grilled” can further refine the selection process.
Logical organization not only aids in navigation but also enhances the overall dining experience by reducing decision fatigue.
Item Placement
Item placement on the menu can have a significant impact on what guests decide to order.
The “Golden Triangle” concept suggests that guests’ eyes typically first gravitate to the center, then the top right, and finally, the top left of the menu. Placing high-margin items in these areas can drive sales.
Additionally, highlighting signature dishes and specials in these prime spots can make them more appealing. Strategic placement is essential for maximizing the visibility of certain items, encouraging guests to order the dishes that are most profitable or unique.
Readability
A menu should be easy to read and visually appealing. Choosing appropriate fonts and sizes ensures that the text is legible in various lighting conditions.
A key factor to bear in mind is maintaining clear spacing between items to prevent the menu from looking cluttered and overwhelming.
Ensuring the clarity and ease of reading is vital; if a guest struggles to read the menu, it detracts from their dining experience. Effective readability involves the thoughtful selection of fonts, sizes, and spacing to create a harmonious and inviting look.
Balancing Creativity and Guest Preferences
Creative Culinary Expression
A menu is an opportunity to showcase the chef’s creativity and culinary expertise. Innovative dishes that use unique ingredients or cooking techniques can set a restaurant apart from its competitors.
Creativity is crucial for developing a distinctive culinary identity, and offering guests an exciting and memorable dining experience.
However, it’s important to balance creativity with dishes that guests are familiar with and enjoy. Balancing innovation with tradition ensures that while the menu offers new and novel experiences, it also provides comfort and familiarity.
Popular Guest Preferences
To appeal to a broad audience, a menu should include a mix of creative dishes and popular favorites. Including familiar dishes alongside innovative options can cater to a wider audience, making everyone feel welcomed and valued.
Additionally, considering dietary restrictions and preferences is crucial. Offering vegetarian, vegan, gluten-free, and allergen-friendly options ensures that all guests can find something they love. Addressing dietary needs and preferences not only broadens the guest base but also demonstrates the restaurant’s commitment to inclusivity and guest satisfaction.
Market Trends
Staying updated with current culinary trends helps keep the menu fresh and exciting.
For instance, trends such as plant-based diets, sustainability, and ethnic fusion can attract trend-conscious diners. Incorporating these trends into the menu shows that the restaurant is contemporary and aware of its guests’ evolving tastes.
Aligning the menu with market trends can create a buzz and draw attention to the restaurant, enhancing its reputation as a forward-thinking and dynamic establishment.
For more, including the role of psychology in menu design, click here.
How’s Your 30 Days of Bourbon Challenge Going?
September is National Bourbon Heritage Month, and Bourbon & Banter have thrown down their 30 Days of Bourbon Challenge again this year.
For those who are unaware, allow me to introduce you to Bourbon & Banter.
Bourbon devotee and advocate Patrick Garrett founded Bourbon & Banter back in 2011. What has followed over the course of 13 years is the coming together of a team of bourbon aficionados, a community of bourbon lovers, a podcast, and a tasting experience team called DrinkCurious, founded in 2022.
Oh, and, of course, the 30 Days of Bourbon Challenge, which I first covered in September 2021.
Now, I’m well aware that it’s September 9. I’m sure many of you had enjoyed separate bourbons in the eight days prior to the publication of this article. For those who haven’t, it isn’t as though a member of the Bourbon & Banter team is going to run into your bar and slap a bourbon out of your hand if you and your guests run the challenge through October 8.
So, make sure to connect with Bourbon & Banter, tag social posts with #30DaysOfBourbon and #BourbonHeritageMonth, and donate $30 to the charity of your choice if you see fit. Hey, that would be an excellent way for you and your guests to raise funds for a deserving, local cause.
To help you and your guests try new, exciting bourbons this month, check out the Breaking Bourbon release calendar. Scroll down to August and September for some of the newest bourbons to hit the market.
Cheers!
Only. Bourbon. Counts.
There are some rules that you and anyone else participating in this challenge need to honor.
First and foremost: only bourbon counts. I mean, it’s in the name of the creators of this challenge, and the challenge itself.
So, one more time: only bourbon counts.
And, in case anyone needs a refresher, bourbon is, according to the Alcohol and Tobacco Tax and Trade Bureau (TTB), a “[w]hisky produced in the U.S. at not exceeding 80% alcohol by volume (160 proof) from a fermented mash of not less than 51 percent corn and stored at not more than 62.5% alcohol by volume (125 proof) in charred new oak containers.”
The good news is that, as Bourbon & Banter point out, Tennessee whiskey counts toward this challenge. For the curious, this is because Tennessee whiskeys—generally speaking—are bourbons that are filtered through charcoal chips before being rested. This step, which doesn’t violate the rules for classifying a whiskey as a bourbon, is known as the Lincoln County Process.
Continue reading on KRGHospitality.com.