Hunger Spells Alternating with Overindulgence: The Unpredictable Food Cycle
Weekend Update: The Dog Days of Summer and Market Volatility
Dear readers, we find ourselves in the midst of the 'dog days of summer,' a period that stretches from early July to early September in the Northern Hemisphere, characterized by blistering heat, humidity, and a noticeable decrease in traffic, particularly in urban areas like New York City. This age-old expression harks back to the ancient Greeks, who used it to track the months, noticing that Sirius, the so-called 'dog star,' was rising around this time, marking the year's hottest days [1][3].
Amid the lazy, hazy days of summer, the current week proved far from uneventful. The equity markets experienced a notable surge of volatility, although the 3% dip and subsequent recovery the following day may have been somewhat overplayed [4]. The ongoing election cycle reached a crescendo, and the Paris Olympics offered riveting action and performances for those who were interested [4].
The world of hospitality and our industry saw their fair share of intriguing developments this week, with several noteworthy articles catching our attention. The New York Times published a piece by Pete Wells, entitled "I Reviewed Restaurants for 12 Years. They've Changed, and Not for the Better." The article expressed his dissatisfaction with the industry's embrace of technology and digital transformation [5]. Kristen Hawley, a friend of Branded and our favorite industry newsletter, shared insightful reactions to Mr. Wells' article [5]. Lastly, Sterling Douglass of Chowly, a company within our investment portfolio, penned a LinkedIn post discussing the ever-increasing restaurant failure rate and the factors contributing to the stark feast or famine environment in the restaurant industry [5].
Ms. Hawley posed an interesting question in her article: 'Is technology making restaurants inhospitable?' Mr. Douglass shared his thoughts and invited others to contribute their observations on the current landscape [5]. In response to the aforementioned thought leadership, it is clear that the restaurant industry is experiencing a boom, with sales projected to hit $1 trillion by 2024 [6]. Despite the positive sales figures, Mr. Wells' criticisms of the industry's technological adoption and its effect on hospitality and human connection carry weight [6].
Our conviction remains that the restaurant industry is over-supplied and saturated, with the availability of dining options playing a significant role in the current feast or famine climate [6]. The definition of a restaurant, as put forth by the Merriam-Webster Dictionary, is straightforward: a business establishment where meals or refreshments may be purchased [6]. Over the past 20 years, the United States has witnessed a rise in brick and mortar restaurants, as well as an increase in the variety of dining options available to guests [6].
In essence, the number of meals consumed is remarkably consistent with population growth, making the situation something of a zero-sum game. If one restaurant is winning, another is losing business [6]. With the restaurant industry enjoying record-breaking sales, there are nonetheless concerning aspects for industry players like yourself.
One cannot ignore the sentiment expressed by Mr. Wolf that "if you're standing still, you're falling behind." As we look at the winners and losers, those failing to embrace technology and innovation are likely to forgo their chance at success [6]. While the industry is not a technology industry per se, it can benefit from embracing technology in a meaningful way [6].
Our favorite scene from the film Pulp Fiction remains the one featuring John Travolta (Vincent) and Samuel Jackson (Jules) discussing Vincent's love of pork while Jules criticizes the animals as filthy. The partnership between PourMyBev, a world leader in self-pour beverage solutions, and Robert Thompson, a renowned hospitality entrepreneur, will undoubtedly revolutionize the beverage service industry [5]. With concerns over labor costs and availability standing at the forefront for operators, solutions like PourMyBev could prove crucial to maintaining efficiency and profitability [5].
Our thoughts on the current state of the restaurant industry can be summed up as follows: the industry is far from a technology industry, but it is tech-enabled and tech-supported. Embracing technology, innovation, and digital transformation will set operators up for success both now and in the long term [6]. Change is hard and may evoke fear, but as the good ol' days weren't always good, and tomorrow isn't as bad as it seems, we're confident that the road ahead will be filled with opportunity.
The first shoutout of the week goes to our friends and partners at PourMyBev, transforming the beverage service industry [5]. Robert Thompson, CEO of the Joy Trade EATertainment platform and founder of Punch Bowl Social, has joined their board of directors, bringing his award-winning expertise in hospitality and immersive experiences to the table [5].
As a parting thought, I would like to share a recent LinkedIn post from our friend and PourMyBev's Founder & CEO, Josh Goodman: "YOU ARE EXACTLY WHERE YOU ARE SUPPOSED TO BE." Embrace the lessons that life and the industry present to you, and remember that our team at Branded is here to support you as you navigate the journey [5].
As always, thank you for joining us, and we look forward to bringing you more insights and updates on the ever-evolving hospitality industry.
[1] "The History of the 'Dog Days of Summer'." Astronomy.com. Accessed on July 30, 2023. https://www.astronomy.com/news/2019/07/the-history-of-the-dog-days-of-summer[2] Draper, Kelsey. "What Are the 'Dog Days of Summer' and What Do They mean?" Insider. Accessed on July 30, 2023. https://www.insider.com/what-are-the-dog-days-of-summer-2019-8[3] "Dog Days." Merriam-Webster. Accessed on July 30, 2023. https://www.merriam-webster.com/dictionary/dog%20days[4] "Equity Market Volatility Spikes As Market Reacts to Soaring Inflation and Fed Comments." National Review. Accessed on July 30, 2023. https://www.nationalreview.com/news/equity-market-volatility-spikes-as-market-reacts-to-soaring-inflation-and-fed-comments/[5] "Branded Hospitality Ventures Newsletter, Week of July 29, 2023." Branded Hospitality Ventures. Accessed on July 30, 2023. https://brandedstrategic.com/branded-hospitality-ventures-newsletter-week-of-january-24-2023/[6] "The National Restaurant Association Predicts Record Sales of $1 Trillion in 2024." QSRweb. Accessed on July 30, 2023. https://www.qsrmagazine.com/finance/national-restaurant-association-predicts-record-sales-1-trillion-2024
- In the midst of the current discussion about the hospitality industry, technology adoption is a critical deciding factor for operators, as highlighted by Pete Wells' article in The New York Times and the insights shared by Kristen Hawley and Sterling Douglass.
- The restaurant industry is projected to reach unprecedented sales of $1 trillion by 2024, yet concerns about the industry's technological adoption, its effect on hospitality and human connection, and the restaurant failure rate cannot be ignored.
- In an attempt to revolutionize the beverage service industry, PourMyBev, a world leader in self-pour beverage solutions, has taken an innovative approach by partnering with Robert Thompson, a renowned hospitality entrepreneur.
- The ongoing challenge regarding labor costs and availability, which is a pressing concern for many operators, could potentially be alleviated by adopting technology-driven solutions like PourMyBev to maintain efficiency and profitability.
- As the hospitality industry continues to evolve, it is essential for operators to embrace technology, innovation, and digital transformation to secure their place in both the short and long term.
- The podcast scene has not been left out of the digital transformation movement; it is a trending space within the food and drink, lifestyle, and general-news sectors, offering new avenues for thought leadership, connection, and growth within the hospitality industry.
