Small restaurants may have a tough road ahead, but far from keeping their heads down and doing the bare minimum to make ends meet each day, many remain willing to invest in innovations, and forge their way to a brighter future.
The Main Street hospitality business is more likely than any other type of institution to look to a promotion, according to research from the January issue of The Main Street Merchant Index™ (MSI), “Main Street Index: Optimism Amid Inflation Edition,” PYMNTS and Melio, Which is based on a survey of 765 Main Street USA business owners conducted in the late fall.
Get the study: Main Street Index
Specifically, 55% of food, entertainment and accommodation companies said they were “very” or “extremely” likely to invest in equipment purchase or upgrade in the next six months. This number puts these companies above the other categories and comfortably above the overall 51% of Main Street businesses saying the same thing.
This focus on innovation comes even though restaurants are struggling financially, compared to other businesses. Only 47% of food, entertainment and accommodation companies report that they expect higher returns in 2022 than in 2021, well below the 64% of companies across industries who expect the same.
Much of this innovation is likely to take the form of adopting new digital payment tools. The index found that, among the front-office capabilities Main Street companies plan to invest in next year, the option to pay with QR codes was the number one choice, soon followed by the ability to pay with digital wallets, with the addition of reward programs coming in third.
Notably, corporate priorities here differ from those of consumers, as evidenced by data from this month’s edition of the Digital Gap report, “The Digital Divide: Minding The Loyalty Gap,” a collaboration between PYMNTS and Paytronix, which included a survey of more than 2,400 adults Americans about their eating habits. The study found that loyalty programs are the most important feature consumers say will encourage them to buy restaurants, with digital wallet and QR code payments delayed.
Read the report: Bridging the loyalty gap
In addition to adding new consumer-oriented technologies, restaurants will likely be looking to upgrade their kitchens, as the equipment in the home gets smarter every day. At the forefront of this innovation are automated devices to take labor out of simple food preparation and production tasks, a vital function where labor challenges continue to place a heavy burden on the industry. By exploiting these new technologies, young freelancers will take advice from the category giants.
“There hasn’t been a lot of talk about this because it’s not about guest-facing, but about enabling kitchen operations with more digital, allowing for more dynamic kitchens…these kinds of things are going to be a trend in the restaurant space as people go out,” said Steve Su, Head of Experience. Digital on Shake Shack, tells PYMNTS in an interview.“Digital will expand to other wheel speakers.”
Read more: Shake Shack is witnessing a digital experience driven by dynamic kitchens