Three hospitality leaders talk inflation and what diners get wrong about the bill

At a recent Formidable-ExplorePNW event, “Restaurants in Crisis: Inside Seattle’s Hospitality Industry,” a panel of industry leaders and innovators discussed the economic realities of keeping the dining scene vibrant, resilient and sustainable for the future.

They are:

• Amy Burns, CEO of Anthony’s Restaurants, a Kirkland-based, family-operated seafood chain that owns and operates 27 locations across the Pacific Northwest.

• Lillian Rambus, owner of Simply Soulful Café, a Seattle-based, family-owned café serving classic soul food.

• Columbia Hospitality Vice President of Food and Beverage Simon Dolinky, who oversees all aspects of culinary operations for the Seattle-based company’s 100-plus properties across 12 western states.

Edited for length and clarity.

What are the biggest misconceptions customers have?

Burns: When you raise your prices, they think that’s all going into your pocket. It’s not at all. We have to raise prices every year to stay up with inflation and cost of labor and goods. This year, I sat down with our executive chef and said, “OK, we need a revised approach given the economy. We need to look at social behaviors.” People need deals. Promotions are important. The volume helps offset the increases.

How did the pandemic change the industry?

Rambus: During Covid, we had more foot traffic because people were forced into the takeout arena. I feel like sales actually went up during Covid, but so did prices. The difference now we’re facing is that prices went up and never came back down. The foot traffic is down. I know, especially for Black businesses, you had the George Floyd thing, so people were being a lot more intentional about what they were doing with their money. I think that is still true, but economically they’re having a hard time. People had more money during Covid and we’re on the opposite trend right now.

Burns: I do think Covid really helped our guests transition more into technology. We had to figure out ways to do dining, get all our venues online, etc. But afterwards, even with QR readers, people are coming back to those because it gets you to the website, it gets you to an event. We’ve moved our walk-in-only restaurants onto Open Table, and it has increased sales by 20%, which shocked us. Technology is here and the next generation is all about it.

Dolinky: I look at it a lot from our staffing perspective. It turned a lot of people away from the industry. We haven't caught up, and it's getting harder and less appealing, and you're just kind of constantly wondering, where's that next generation? I think years ago, if you went into a kitchen in a restaurant and asked everybody what their goal was, it was to become the executive chef or to own their own restaurant. It's not like that now, and it changed significantly during that time.

How do you deal with tipping?

Rambus: I'm a small restaurant, a counter service restaurant, so tipping for me is very tricky. I can’t add a service charge. You have to do everything that makes (customers) feel good about spending their money with you.

Dolinky: It’s a tough conversation to have. There are times when a surcharge, service charges, fit, but everybody wants to know where their dollar goes, so it’s better to be 100% transparent so people can feel like they’re part of the process and it’s not being dictated to them.

How have the minimum wage and loss of tip credit (which previously allowed employers to count tips toward minimum wage) affected your operations?

Dolinky: It’s not a one-size-fits-all. There’s a misunderstanding that what applies to one restaurant does not necessarily apply to another. It’s a stressful environment to be in when the margins are razor thin. Minor situations — like when a cost goes up on a single item — can affect shifts. It’s complex.

Rambus: The minimum wage has had a drastic effect. I used to have 15 staff. It’s down to 10. There are no more community jobs for children because I just can’t afford to hire somebody and pay them $28 an hour to teach them how to sweep a floor. It breaks my heart. We’re located in the Central District. It’s easier for a young child to get a gun than a job. We have a serious problem. I take more shifts. I haven’t paid myself a full-time wage in over six or seven months.

What role should government play?

Rambus: There are ways we’re looking to get help. Don’t do it to us, work with us. If I was a single mother, low-income and hurting, and I needed help with my energy (there are resources) but there’s nothing like that for any kind of small businesses, even with some of the programs the city already has. Some of them are just low-interest loans, so that adds another middleman that’s just going to squeeze us. How do we get more direct help? I think it just comes out of collaboration. Ask us. We don’t have an ulterior motive. We’re not trying to live high on the hog or squeeze our employees for every bit of work we can get out of them. They’re our family, but I think small businesses and big businesses have been lumped together.

Burns: Our state wants us here. Tourism is a big thing, and we create really amazing places for all to gather. There’s nothing more to it. We create those places, and you would think (government) would want us to keep doing that.

Dolinky: Having a conversation is one thing, but having a collaborative effort toward solving a problem is what everybody’s asking for.

What does a sustainable wage model look like?

Rambus: Until (government) figures it out, they should leave it alone.

Can independent restaurants still thrive in Seattle?

Burns: I sure hope so. People want local homegrown Northwest. It’s up to us to figure this out.

Rambus: Seattle is a place that prides itself on being a small community where we have our different neighborhoods, different restaurants. They’re each very unique, but I believe we are trending to a corporate landscape. Small businesses are failing.