The Great Vanishing: Why Your Go-To Local Restaurant May Be Next to Disappear

Key points

• A convergence of post-pandemic debt (EIDL/PPP loans), soaring food and labor inflation, and high real estate costs is creating a financial crisis for independent restaurants.
• The pandemic-driven shift to third-party delivery apps continues to hurt restaurants, as commission fees of 20-30% can erase the entire profit margin on an order.
• Consumer behavior has changed, with diners cutting back on discretionary spending due to inflation, making it difficult for restaurants to raise menu prices to cover their own rising costs.
• To support local restaurants, consumers should prioritize dining in, ordering takeout directly from the restaurant, tipping generously, and providing a steady, reliable customer base.

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Sources and methodology

Reported from the public datasets below.

• Bureau of Labor Statistics (BLS) - Consumer Price Index, food away from home
• Federal Reserve Economic Data (FRED) - Food services and drinking places series
• U.S. Census Bureau - Monthly Retail Trade, food services

All sources Foodie Pundit reports from

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