Danny Meyer upended the restaurant industry when he opened Union Square Cafe in 1985 with an employee-centric management style. His New York Times bestseller Setting the Table would become a must-read among managers in a variety of industries. Today, his Union Square Hospitality Group operates 20 eateries, and his Shake Shack brand has become a successful public company. In April, Mayor Bill de Blasio named him chair of NYCEDC as it brings the city back to economic capacity after being shut down for more than a year.

This week, Acadia Realty Trust president and CEO Kenneth Bernstein interviewed Meyer at ICSC’s RECon Digital.

Rent

“The lease has become disconnected to the reality of where we are,” Meyer said. In one-on-one negotiations with landlords while his restaurants were shuttered, Meyer achieved one of two solutions for each of his restaurants: percentage of rent equal to the city’s mandated indoor capacity to serve or a percent basis until the trailing three months hit a certain level.

Demand

“More than for food, there’s a cooped-up demand to be with people,” Meyer said. “Americans are craving dining out like I’ve never seen in my entire life.”

Staffing

The industry is heading from zero employment capacity to full employment capacity, as are other industries, so they’re all competing for a limited pool of workers, Meyer said. “It’s like eight car lanes trying to merge into one tunnel.”

Menus

Meyer believes the QR codes that sprang up as a no-contact way to convey restaurants’ menus to diners will remain. “QR codes are here to stay. They don’t scare people.” Still, the restaurant he plans to open this year will have paper menus.

Payment technology

“The days of having to flag your waiter down to get your bill should be over,” he said. “We’re working on a technology that gives you a chance to leave when you want to leave.”

Tipping

Meyer famously did away with tipping at his restaurants and instituted a hospitality fee on checks instead. But he has reinstituted tipping in the wake of the pandemic because customers wanted to thank the staff. “Tipping is not the problem,” he said. “It’s the inability to share tips that’s the problem. We instituted a revenue-sharing model that includes cooks and other workers.” The consumer embraces including all hospitality components in the price of the food, he said.

Third-party delivery services

“The cost of working with DoorDash is more than rent,” Meyer stated.

Food waste

High prices during the pandemic have encouraged restaurants to manage waste and recycle food more effectively. “COVID made chefs more skilled at saving food,” he said.

Registered attendees of ICSC's RECon Digital can watch recordings of conference sessions, including Danny Meyer's keynote, here.