Restaurant industry outpaces pre-pandemic growth with a surge in new openings in 2023
WASHINGTON (TND) — The restaurant industry appears to be recovering after thousands shut down due to the COVID-19 pandemic.
According to Yelp, there were 53,793 new restaurant openings in 2023, according to just the restaurants on the platform.
The restaurant industry has proven to be resilient throughout the pandemic, with the industry seeing higher restaurant openings in 2023 than pre-pandemic levels for the first time," explained Cliff Cate, Vice President and General Manager of Yelp Restaurants. "Even through economic challenges, restaurant owners continue to delight their diners, staying responsive to shifts in consumer preferences like the increasing demand for earlier reservation times and higher-end experiences, as Yelp data shows. In 2024, we expect to see this positive momentum continue as the restaurant industry continues to meet the moment.
The National Restaurant Association (NRA) said the number of restaurant closures must also be considered to assess the overall health of the industry.
The association added the industry on average saw about 60,000 eating and drinking establishments open each year and 50,000 closed each year before the pandemic.
It is a fact Magdalena Gebrekristos, the owner of Love Life Coffee in Maryland is aware of. She is updating the menu and trying to keep prices as low as possible.
We're still struggling but we do well because we're still here," she said. "The challenge now is to get more customers to know us.
According to Ted Rossman, senior industry analyst for Bankrate.com, customers are willing to spend more eating out despite inflation.
"I think some restaurant operators are kind of striking while the iron is hot, you know, kind of leaning into this consumer demand for Out Of Home experiences things like travel and dining," he said.
Government data revealed on average Americans spent more than $3,600 eating out in 2022. The current inflation rate for food away from home has risen to 5.2%.
"People have mostly gone back to the old habits and if anything, what we've seen is an acceleration, this kind of pent-up demand of, I know it's expensive but you only live once and I want to do it anyway," Rossman added.
Customers are spending, but they are also excited about restaurant deals.
This is evident in the success of Applebee's Date Night Pass. The restaurant chain was selling these passes for $200 for 52 visits from 2/1/24 -1/31/25! Each visit includes $30 of food and non-alcoholic beverages.
The Date Night Pass sale this week showed us that our guests are hungry for date night at Applebee’s—just prior to sale time there were nearly 100,000 guests waiting to try and snag a Date Night Pass," Applebee's told TODAY.com. "Our passes sold out in less than one minute to guests in 41 states — far exceeding our expectations. We apologize to our guests who were disappointed that the limited number of passes sold out so quickly. We’re always looking for ways to make date night special for our guests and look forward to sharing future offers.
Restaurant sales continue to grow, and restaurants added nearly 300,000 jobs in 2023.
However, restaurant owners are cautious.
"I have no idea, you know? Future's hard to predict," Gebrekristos said.
Written by JANAE BOWENS for The National Desk
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