Cameron Mitchell Restaurants CEO on consumers dining out

Last week’s inflation data showing food prices are still elevated and it’s hitting Americans especially when dining out. Food prices outside the home have jumped 4.2% since last year. Joining us now is someone with his finger on the pulse of the restaurant industry, Cameron Mitchell, CEO and founder of Cameron Mitchell Restaurants. Cameron, great to have you with us. Thank you, Melissa. Good to be with you this morning. We mentioned the food cost and the cost of eating out outside the home being on the rise, but also gas prices are higher, electricity bills are higher. What are you seeing in terms of the consumers willingness to spend at a restaurant? Well, I think we’re still doing pretty well. Our guest traffic is still up over 2019, so that’s a good sign. Although we’ve fallen since 2022 which I think we’re at peak, we had a tremendous amount of support money out there from the government for people to so they were spending but I so we’re having a slight little bit of reset but I think All in all we’re doing well our our prices we have just taken a 2% price increase here just a month ago and we had to our annual spring price increase but still keeping our prices lower. So our inflationary prices is not not that much cost of goods on the other hand for us is the one bright spot We’ve seen a reduction in our inbound cost of goods down about 1% on the overall P&L and back to pre pandemic levels also. So that’s a bit of good news for us. OK. So that’s on the cost of goods sold, but how about labor costs as we’re seeing those pretty much go up across the board across the country that is that’s the sticky point, which is a good thing for us that the, you know, the actual labor cost out there in restaurant businesses up about 40% since 2019, 35 to 40%, four zero percent, wow, most salary and hourly labor. So meanwhile our prices have risen internally over the past five years about 20% on an annual pace of 4%. So that’s where you know we can’t really keep up with labor in that regard, but as long as we can get cost of goods down and hopefully get our our interest rates back down a little bit, that’ll help out tremendously. But it’s a good thing overall for the restaurant industry to see those wages increase and and they’re not going to come back down, they’re here to stay. You mentioned the 2.2% spring increase to menu prices and I’m wondering Cameron, if you think you’re at the point where you can’t raise prices anymore, the consumer is going to just get fed up or or scale. But I don’t know what you’ve seen in terms of total check. You mentioned traffic is up, but maybe consumers are are paring back in terms of how much they’re spending when they’re actually at the restaurant. Yeah, total check is still holding up. It’s really the, we’re seeing a slight in guest counts while they’re above 19, we’re seeing again a slight drop over last year, so a slight decrease in overall sales. But you know, as far as the consumer goes, I think so far they’re holding up and I think we’ve seen that other data around the country at this point.