The challenges of the times are triggering responses that could politely be called unconventional. Some might say strange. True realists would likely scream, "Have you lost your minds?"
It’s not normal, for instance, for restaurant-chain executives to air hopes for an upswing in food costs. Ditto for celebrating new minimum-wage legislation, or servers being stiffed on tips.
Here are some of those puzzling developments—and why others in the industry may be cheering.
1. ‘Hurray! Food costs might rise!’
Cliff Hudson’s longtime leadership of the Sonic Drive-In chain has earned the respect of his peers. So more than a few heads likely turned when the CEO enthusiastically predicted this week that commodity costs will swing upward again by year’s end. And that, he said, will be a godsend.
“This should help this competitive environment we are in,” Hudson explained to financial analysts.
The pressure on margins will likely discourage the discounting and deal-making that has thinned sales and turned consumers into bargain hunters, Hudson continued. He predicted that the turnabout would help Sonic avoid another quarter like its last one, in which same-store sales fell by more than 7%.
He predicted that the “relief” could start this summer.
2. Tipping badly as a lobbying move?
Opponents of minimum-wage increases have brainstormed some creative ways lately of convincing lawmakers to stand down on pay hikes. As we reported earlier in the week, Minneapolis restaurants demonstrated with research that hiking servers’ wages to $15 an hour might actually cut waiters' and waitresses’ incomes.
Restaurants in some areas of Iowa will likely see prevailing wages decline because of a state bill that passed this week. The measure prohibits counties and towns from passing their own minimum wages, in effect setting the pay floor at the state level of $7.25 an hour. Areas that had pushed the minimum above that level will have to lower their threshold back to the more moderate state rate. The wage legislation has been warmly received by employers in the state.
But the real corker has to be the one-man campaign being waged in Maine by Governor Paul LePage for a reinstatement of the state’s tip credit.
The controversial conservative Republican revealed to a local radio station that he’s trying to enlist servers in the effort to forgo a $1-a-year increase in their wages by reminding them of the potential damage. The increase in wages could prompt customers to tip less, according to the governor and other proponents of restoring the full tip credit.
To make the point, LePage has been tipping half of what he usually leaves as a gratuity. He also leaves the name and phone number of the waiter's or waitress’ state representatives and suggests the server share their feelings about a possible drop in tips.
3. No good deed going unpunished
Starbucks turned heads earlier this year when it aired plans to adopt an unparalleled parental-leave policy for store employees. Virtually no other restaurant employer has been as generous: six weeks of time off at full pay.
Yet the response from employees has been a surprise. Some 80,000 workers and their supporters have signed a petition protesting the benefit, blasting Starbucks for being stingy and discriminatory.
Why should crewmembers only get six weeks, when salaried headquarters employees get 18 weeks of leave at full pay?
The issue was also raised during the company’s shareholder meeting. Incoming CEO Kevin Johnson explained, “We had to make a hard decision [on] how to prioritize,” and left open the possibility of the discrepancy being addressed down the line.
4. ‘Please, judge our coolness.’
Olive Garden deserves a tip of the toque for its risky effort last week to change perceptions of the Italian chain’s menu. It collected 40 lifestyle bloggers in Chicago to try the brand’s new lighter dishes, which are aimed at a younger clientele, including millennials. The hope was to convince the arbiters of fashion that the brand might actually be cool.
Would that be the takeaway, or would the professional snarks decide that the brand was just an oldster desperately trying to appear hip, like a paunchy 70-year-old in a crooked baseball cap?
Consider that the event was based on a gimmick: The writers in attendance were being taken on a virtual train tour through Italy.
But, based on limited evidence, the gamble paid off. At least one blogger seemed to come away with the notion that this was not his father’s Olive Garden, even if the writer appeared to fall outside the millennial bracket himself.