What if you could work tables at a restaurant but still be home in time to feed your own family?
That’s the proposition breakfast-and-lunch chains are offering workers, turning an inherent limitation—no dinner—into an advantage amid a historic labor crunch.
“It’s unheard of to be a restaurant manager and be home every night with your kids for dinner,” said Chris Milton, CEO of The Toasted Yolk Cafe, on this week’s episode of RB’s “Buzzworthy Brands” podcast.
But that is what workers can expect at one of his chain’s 17 restaurants, which are open from 7 a.m. to 3 p.m. And that is paying off for Toasted Yolk, which plans to add 10 units next year.
“I’ve got very few restaurants right now that are struggling on the staffing front,” Milton said. He noted that the chain’s job postings for restaurant managers typically yield 120 to 130 applicants.
The breakfast-and-lunch segment is growing quickly. After years of same-store sales increases, First Watch became the first of these concepts to go public earlier this month with a $170 million IPO. Several smaller competitors, including Eggs Up Grill and Toasted Yolk, are seeing sales above 2019 levels right now.
That success is due in part to the fact that their restaurants have been less impacted by the hiring squeeze that has left more than 70% of U.S. restaurants understaffed.
En route to its IPO, First Watch touted its “No Night Shifts Ever” policy that it said has helped it attract and retain workers. In the 12 months leading up to the pandemic, the company’s restaurant-level manager turnover was 29%, much lower than the 41% average among its peers, as reported by Black Box Intelligence. After closing restaurants at the beginning of the pandemic, 90% of its GMs returned when they reopened.
“Our model has made [labor] a lot easier, for sure. And, again, it goes back to the employee proposition,” said CEO Chris Tomasso.
In contrast, chains open late are having problems. As of August, 60% of Denny’s restaurants had yet to return to 24/7 service because of difficulties finding people to work overnight. And 7-Eleven franchisees have been calling for the company to end its requirement that stores stay open around the clock, in part because of hiring challenges.
The labor advantages afforded by daytime dining are attracting more operators to the segment. BBQ Holdings, which acquired family-dining chain Village Inn in July, is developing a new prototype for the chain that eliminates dinner and trims its hours to 7-3.
“The a.m. eateries are very attractive from a labor perspective,” said BBQ CEO Jeff Crivello. “You can get the kids off the bus, you can be at the dinner table every night, and you can really make a career out of it.”
Over time, the company plans to convert many of Village Inn’s 135 restaurants to the new model.
“The majority of the business is in the morning, and again it just creates a labor problem” having to fully staff the stores at night, he said.