Elon Musk, are you listening? The restaurant industry needs you!
As Elon positions himself to take over Twitter, is there any chance he can put aside a few of those billions to help automate the fledging restaurant industry? The $42 billion bailout passed by the House last week for the restaurant industry is only a bandage. We need Musk. In this podcast, Buddy Foy Jr. unpacks House Bill 3087, which was recently passed by the House of Representatives and is now heading to the Senate. Buddy talks about what the industry needs for long-term success, which is a government-subsidized technology revolution for the service industry.
Buddy plays a clip from his Fox and Friends appearance this week.
Show Notes: I refer to conversations with investors and discuss “pay people more.” My mind is blown on two fronts with this comment: (1) We are paying them more, 25-40% more, and they expect us to pay even more than that? (2) How profitable do they think the restaurant industry is? These are the same folks giving restaurants 1-star reviews for slow service and high menu prices. Do they expect us to be non-profits while they rake in their private equity returns?
The House passed Bill H.R. 3807 last Thursday, a bill to help revitalize the restaurant industry. The bill, which will go to the Senate floor, infuses $42 billion into the restaurant revitalization fund. First in line for the bailout grant will be those 177,000 restaurants that were approved to receive RRF grants during the last round of the federal bailout package but did not receive any monies due to overwhelming restaurants eating up the proceeds before all of those approved could be fulfilled. Will the bill pass? I predict that it will. The full-service restaurant industry employs some 15 million workers, of which a majority are of voting age, making up the second-largest employing industry in America. This means it's likely to pass.
Our industry needs automation when it comes to the back of the house, i.e., the kitchen. It needs automation when it comes to the front of the house, i.e., bartenders and hostesses. Any touchpoint that’s redundant and can be automated needs to be automated. But we're not McDonald's. We're not the DQ. People say to me, "Yeah, but they are automating. McDonald's is investing in automation. Dairy Queen is investing in automation." Folks, we don't have their money. The lion's share of our industry is individual restaurant owners. The restaurant industry, the full-service industry, is the second-largest employer in America. On American soil, the restaurant industry employs 10 to 15 million people. Pre-pandemic, it was 15 million. Post-pandemic, the numbers are all over the place, as low as 10 million or as high as 12 or 13 million. It's the second-largest private-sector employee industry in America. 89% of restaurants employ less than 20 people. These are small family-owned restaurants.
Don't get me wrong. Like I said before, our industry has been challenged for a decade now because of a shift in demographics, a shift in work ethic, a shift in where the young people are spending their weekends—on sports fields, in playhouses, and doing extracurricular activities versus earning money by shoveling driveways, raking lawns, and busing tables. Don't let the industry kid you, as I said, we've been driving on three full tires and one tiny little donut spare. But now, we're on all four spare tires. We need a shake-up, and it needs to happen fast. Subsidizing our technology will spin our industry and create solutions for the individual restaurant operators that will make it affordable for them not only to survive but to thrive. Handing out $42 billion is something that will have to be done every single year if we do not focus on the core problem: a shift in labor, a shift in work ethic, and a fear of where to invest.
Welcome back to the Buddy Foy Jr. Show, here is Buddy.