Professional Documents
Culture Documents
RE: Struggling Under Declining Traffic and Shrinking Sales, DC Restaurants Call on
DC Council to Act Now
A year after passage of Initiative 82, significant numbers of DC restaurants are contending with dwindling
customer traffic and diminishing revenues, threatening the viability especially of local independent
restaurants.
“Our neighborhood restaurants are caught between a rock and a hard place,”said Shawn Townsend,
President and CEO of the Restaurant Association Metropolitan Washington (RAMW). “Costs have
soared, but diners understandably can pay only so much for a meal.”
“Thankfully DC Councilmembers can help,” Townsend said.
More than one-third of restaurants are experiencing a drop in sales and traffic.
Large numbers of restaurants report declines in both sales and customer traffic, according to a survey of
RAMW members:*
● Summer sales fell for more than one-third (35%) of restaurants compared to last year, dropping an
average of 31%.
● That decline expanded the following month. In September, 40% of restaurants reported a
downturn in sales, with an average decline of 28%.
● Customer traffic is following a similar path. Summer traffic fell for 44% of restaurants from last
year, dropping an average of 28%.
● September customer traffic shrank 46% from the prior year, averaging a decrease of 27%.
Summer September
Sales Down - 35% Traffic Down - 44% Sales Down - 40% Traffic Down - 46%
35% of restaurants’ 44% of restaurants’ 40% of restaurants’ 46% of restaurants’
summer sales were summer traffic was September sales were September traffic was
down from last year. down from last year. down from last year. down from last year.
The sharp drops in revenue and traffic report reflects the findings of a summer survey** of DC diners
about how higher prices are changing their dining habits:
● 52% of DC diners are eating at home more often because of increased prices.
● 43% of diners are eating out less often.
● 32% of diners are eating in Maryland and Virginia more often.
Restaurants have raised prices, but it’s not keeping up with inflation.
Nearly all – 96% – of restaurants have increased prices since the outbreak of the pandemic, but inflation is
outpacing those increases.
● 81% of restaurants are paying more for ingredients than before the pandemic. Food costs are on
average 23% higher than in 2019.
● 91% of restaurants are paying more wages, on average 25% more.
● 58% of restaurants have higher occupancy costs, averaging an increase of 18%.
● However: Menu prices have increased on average just 16%.
Declining Profitability
2
Since Councilmembers Pinto and Henderson introduced the Dram
Shop Clarification Act in January, the Alabama Legislature passed
dram shop reform, changing their insurance ranking from a 10 to a 5
and leaving DC the second-worst in the US in insurance rankings.
3
Ending the tipped wage early helps to speed up settling into the new normal.
“From a restaurateur's perspective, stretching out the end of the tip credit makes it needlessly
complicated, requiring operators to remodel their labor costs each time an increase takes place,” said
Townsend. “With each remodeling comes a new need to educate our staff and guests about how it all
works – over and over again.”
Tipped workers would also earn an additional $12,480 in wages by ending the tip credit early.
Ending the tipped wage sooner than scheduled has strong support among operators:
● 73% of operators believe speeding up the end of the tip credit will help to speed up settling into a
new normal, where diners can focus on dining rather than service charges and tipping.
● 53% of operators feel speeding up the end of the tip credit helps to level the playing field between
small independent restaurants and large restaurant groups better able to absorb increased costs.
“The challenges for our local restaurant industry at this point in time are critical,” said Townsend. “The
Dram Shop Clarification and Workers and Restaurants Are Priorities Acts are two vital legislative
proposals that can provide real relief.
“We look forward to DC Council passing both without delay.”
---
4
* The RAMW member survey of 287 restaurants was conducted online Sep. 28 to Oct. 8. Respondents
were mostly casual full-service restaurants (69%) and independently owned and operated (95%). Survey
respondents were also:
● 66% Women owned restaurants
● 14% Hispanic owned restaurants.
● 11% Black owned restaurants.
● 11% Asian Pacific Islander owned restaurants.
● 6% Veteran owned restaurants.
** The Morning Consult online poll was conducted for the National Restaurant Association Aug. 14 to
Sep. 5 among a sample of 944 adults in the Washington, DC area who have dined at a restaurant in the
past 3 months.
*** Since Councilmembers Pinto and Henderson introduced the Dram Shop Clarification Act in January,
the Alabama Legislature passed dram shop reform, changing their insurance ranking to a 5. DC is now the
second-worst in the US in insurance rankings.