Labour & Sales Issues Are 2025’s Top Hurdles for Restaurants & Cafés

This article first appeared in Tea & Coffee Trade Journal.

Labour issues and rising food costs remain the biggest challenges for restaurants and cafés heading into 2025 according to a new State of the Restaurant Industry survey. Findings from Restaurant365’s annual industry survey reveal 2024’s top challenges and opportunities and their 2025 priorities, including increased marketing and sales efforts alongside new benefits and programs to attract and retain staff.

Participants in the new survey, which included restaurant leaders representing more than 6,200 locations, reported continued food and labour cost increases, with 88% experiencing rising staff expenses, compared to 89% in last year’s annual survey, and 86% reporting an increase in food costs. For those with rising labour, 51% reported a 1% to 5% increase, 41% experienced a 6% to 14% increase, and 8% saw labour costs rise more than 15%. The most significant impact was on restaurants’ ability to achieve their maximum potential, with 59% of respondents saying labour challenges led to operating below full capacity.

For food, 53% reported a 1% to 5% jump, 37% saw a 6% to 14% increase, and 10% saw a more than 15% rise. The primary response was menu price increases, with nearly 61% of respondents adjusting prices to cope with the new reality.

Looking to 2025, restaurant leaders expect waves in the year ahead, with 32% pinning recruitment and retention as their top challenge, 27% most concerned about rising food costs, and 21% flagging sales volume as the main hurdle.

Read the full article in Tea & Coffee Trade Journal.