The restaurant business is still having a tough time and you are the winner as a result.
Chain restaurants have been saying they want to wean customers away from discounts…yet the discounts have come roaring back. As an example, I spoke recently about how Red Lobster launched some deals that led to massive customer traffic.
Except for Panera Bread, everyone else has had to be promotional — even high-end restaurants. At the same time, supermarkets have raised prices in quite a few categories over the last year. So what gives? Well, people gotta eat! They might bring lunch instead of going out to eat or fix breakfast at home instead of picking up it up at a drive through on the way to work.
In addition, unemployment among young people has made a huge impact. Overall restaurant visits are up among those over 35 over the last many years. But the number of visits from those under 35 who suffered the brunt of unemployment has collapsed.
As a result, the 35 and under crowd took out enough demand out of the system to put the hurt on restaurateurs who have to keep traffic and customers up or face extinction. So the reality is this is a great time for people who can afford to eat out. The deals are everywhere. All you’ve got to do is look.
One fast food restaurant I go to has moved an item off their 99 cent menu and priced it at $1.29. Rather than paying the 30-cent increase, I’ve product substituted to something else on the 99 cent menu. Hey, you’ve got to stretch every dollar, right?!
Editor’s note: This segment originally aired Nov. 7, 2011