Latest / "Mise En Place" Culture First™ / PULSE! Today’s Hotel, Restaurant & Bar Industry News Deep Dive | 10/01/2026 Episode
Transcript
- Brad Peters: Welcome to Pulse, today's hotel, restaurant, and bar industry news. A deep dive from HRB Universal, navigating your industry. With insights from leaders, McDonald's is turning to AI to dynamically price your Big Mac. Hormel just dropped a billion dollars to dominate the chicken supply chain, and we are unpacking the radical three-word framework that could solve your restaurant's labor crisis overnight. Yeah, I mean, it is just a massive day for operational shifts. And the ground is moving. Incredibly fast beneath our feet right now. Welcome to Pulse, today's hotel, restaurant, and bar industry news deep dive brought to you by HRB Universal. We are delivering the critical updates, trend analyses, and operational intelligence you need to stay ahead in hospitality. And you know, staying ahead is no longer just about having the best menu or the nicest hotel rooms. It is really about anticipating the macrowaves before they crash into your specific operation. Exactly. And that is why I am speaking directly to you, ⁓ the operator, the general manager, the executive suite leader listening to this right now. We have a monumental stack of intelligence to get through today. We really do. So the mission of this deep dive is to break down these massive corporate shifts, these sudden technological leaps, and these evolving workforce strategies and distill them into actionable intelligence. Like we aren't just going to read the headlines to you. Right. Because that doesn't help anyone on the floor. Exactly. We are going to figure out the so what and more importantly, the what now. How do you actually apply this on your floor during your Friday rush? We are pulling from industry insider briefs, executive strategy alerts, and high-level leadership coaching notes. So let's jump right into the deep end here. Let's do it. We are starting with technology because I mean, it feels like the fundamental operational blueprint of this industry is being rewritten in real time. We are officially entering the era of the intelligent operation. Yeah, we are. And the biggest shockwave here, Reuters is reporting that McDonald's is pushing to have artificial intelligence dynamically price menu items. Look, this is the exact moment AI transitions from a novelty to a core survival mechanism. Totally. For the last few years, we've seen AI as this, you know, fun, ⁓ experimental gimmick, like the novelty robot flipping burgers or the automated greeting at the drive-thru. Right. The stuff that makes the local news. Exactly. But this This is AI being deployed at the single most critical junction of any hospitality business, which is margin protection. I want to stop and unpack this immediately because I gotta tell you, my alarm bells are ringing. We are talking about dynamic pricing, like uber surge pricing, but for a fast food hamburger. It sounds wild when you say it out loud. It does. Now, I am putting myself in the shoes of a GM or an owner right now. If I change the price of my signature burger from, say, 599 to 680 just because a high school football game let out and my drive-thru is packed, my core regulars are going to absolutely revolt. ⁓ they would lose their minds. Right. I am looking at this and thinking about the foundational hospitality contract. You provide consistency, I provide my loyalty. Doesn't dynamic pricing completely destroy that trust? Well, it is a massive risk, and you are totally right to view it with skepticism. But let's break down how this algorithm actually functions before we look at the psychology. Okay, lay it out for us. Dynamic pricing isn't just ⁓ a guy in a back room arbitrarily jacking up prices when it gets busy. It is algorithmic, real time pricing adjustments based on a multitude of live variables. Like what kind of variables? The AI is factoring in local demand, the time of day, the ambient weather, traffic patterns on the street outside the store, ⁓ current staffing levels in the kitchen, and real time supply chain costs for that exact moment. Wow, so it's deeply integrated. Very. For decades, restaurant pricing has been entirely static. You print a menu and the item has a fixed price. Which is how it's always been done. Right. But if your wholesale food costs spike on a Tuesday, or if an unexpected busload of fifty people overwhelms your grill and forces you to pay overtime, you, the operator, just eat that inefficiency. You absorb the hit because you have to protect the guest experience. Right. But an AI dynamic pricing engine allows a brand with the scale of McDonald's to protect their margins transaction by transaction. If demand spikes and the kitchen is slammed, the price microadjusts upward. Okay. This doesn't just protect the margin, it theoretically smooths out demand. A price sensitive customer might see the burger as sixty cents more expensive at twelve fifteen and decide to wait until one thirty to eat. Which naturally alleviates the bottleneck in your kitchen. Exactly. And if it's a dead hour, the algorithm might adjust the price downward to stimulate foot traffic. Aaron Okay, I understand the operational logic. It makes sense on a spreadsheet, but I want to push back on the psychology of this, because we actually have a fascinating counterpoint to this exact philosophy from the retail side in our sources today. From Walmart, right? Yes, the CEO of Walmart just went on the record heavily reiterating their core pricing philosophy. He said, and I quote, we price the product, not the person. Aaron Powell That is such a strong statement. It is a direct public rejection of algorithmic surge pricing. They are drawing a line in the sand. It is a brilliant strategic contrast, really. Walmart is publicly signaling to consumers, you know, you will not be penalized for shopping when it's busy. They are weaponizing consistency. Exactly. They are weaponizing the consistency you just mentioned as a competitive advantage. McDonald's, on the other hand, is betting that convenience, speed, and location will ultimately override price sensitivity, at least. On a microtransactional level of a few dimes or quarters. Aaron But have consumers really been conditioned to accept that? I mean, I know we accept it when we book a flight for Thanksgiving. Sure. We know it costs more than a flight in February. We accept it from Uber at 2 a.m. on New Year's Eve. But a Tuesday lunch, that feels fundamentally different. You are punishing a customer for being hungry at the exact time everyone else is hungry. And that is the exact friction point. It's why this rollout is going to be watched so closely by every single restaurant group in the world. Everyone is taking notes. ⁓ absolutely. If McDonald's successfully retrains the global consumer to accept variable pricing on daily food items without suffering a massive dip in loyalty, the floodgates will open. Every major player will adopt it within five years. And if they fail? If they fail, and consumers flock to brands that promise static pricing, like a Walmart or a competitor making a We price the product guarantee, then dynamic pricing will be viewed as a catastrophic brand misstep. Which would be a huge retreat. Yeah, but here is the reality you have to face. The intelligence required to run dynamic pricing isn't going away. It is embedding itself into every sector. We see this in the grocery and convenience store space today, too. Yes. Looking at the convenience and grocery sector, Albert Hein has just set an entirely new standard with their app and their digital assistant. They've named it Stein. It's an incredible piece of tech. Stein is not a simple chat bot that just gives you store hours. Right. It is a fully integrated natural language processing AI. It is woven directly into the app, the loyalty program, the store inventory, and the customer's historical shopping habits. So it knows you. Intimately. You can type or speak to it naturally. You can say, Hey Stein, what should I make for dinner tonight that is under 15 euros, uses the chicken I bought last week and Can be cooked in 20 minutes. And it actually builds the recipe and the shopping list based on real time store inventory. Yeah. It cross-references your purchase history, the live inventory of your specific local store, and the current promotional pricing. That is mind blowing. It generates the recipe, adds the missing ingredients to your digital cart, and maps out where they are in the physical aisles. This ties directly into what SeaStore Dive is reporting today about the rise of the intelligent convenience store. Right. The overarching takeaway from their intelligence brief is that point solutions are officially dead. I need to jump in here because this concept of point solutions drives me absolutely crazy when I am talking to operators. And we really need to clarify what that means for you listening right Go for it. Having 10 different disconnected software solutions in your restaurant or your hotel is like having a prep cook who only speaks French, a grill cook who only speaks Japanese, and an expediter who only speaks Italian. Best way to describe it. Right? Sure, they are all highly specialized, incredibly talented individuals, or in this case, software programs. You have a great scheduling app, a great inventory app, a great point of sale system. But they don't talk. Exactly. They are perfect point solutions. But none of them share a language. The prep cook doesn't know the grill cook is out of chicken, the expediter is screaming in Italian, and absolutely nothing gets to the pass on time. That is the perfect operational translation of the problem. For the last decade, operators have been frantically building these Frankenstein tech stacks. Just bolting things together. Aaron Yeah. They bolt a third party delivery tablet to their point of sale system, then they duct tape a spreadsheet for inventory to the back office computer, then they buy a separate app for employee scheduling. And you end up with massive blind spots. You are double entering data. Your manager is spending four hours in the back office manually reconciling tips between three different systems instead of being out on the floor touching tables. Exactly. The intelligence store concept, which Albert Hein is pioneering and which C Store Dive says is mandatory for survival, means the data flows in a continuous closed loop. Your software must share an API. Let's define API for the listener who isn't a software engineer. How does an API actually work in a restaurant or hotel setting? So an API or application programming interface is essentially the universal translator for your French, Japanese, and Italian cooks. Okay, that makes sense. It allows two completely different software programs to talk to each other seamlessly in real time without human intervention. So in an intelligence store, your customer uses your loyalty app to place an order. Right. Because of the API, that app instantly pings your inventory system to ensure the ingredients are in stock. The inventory system confirms, which informs the point of sale system to accept the order and fire it to the kitchen display screen. Just boom, boom, boom. Exactly. Simultaneously, the inventory system deducts the theoretical food cost of that item from your weekly ledger, and the loyalty program credits the guest with points. No human being had to transfer data from one screen to another. It's a completely closed loop ecosystem. And once you have that ecosystem, you can start doing incredibly aggressive things with customer retention. Absolutely. Look at the retail space. Kroger and Imprint are debuting a co branded MasterCard. They are literally turning the financial payment method into a retention tool. Yeah, they are capturing the customer inside their ecosystem before the customer even reaches the register. It's brilliant. When you control the payment method, the loyalty data, and the inventory, you control the entire consumer journey. You aren't just hoping they come back. You are engineering their return. Which is the holy grail. But it is vital to understand that this intelligence is not just digital, it has to manifest in the physical world. If you build a massive digital ordering apparatus, but your physical building hasn't changed since 2010, you are going to implode. And that brings us to Chipotle. The numbers here are staggering. Chipotle's reimagined drive-thru format, which they brilliantly call the Chipotle, has rapidly grown to 1,500 units. 1,500 locations. That is a massive architectural transformation for a brand that built its entire global identity. On the physical act of walking down a glass line and pointing at the ingredients you want. But look at the underlying logic. Chipotle realized very early on that digital orders require a completely different physical traffic flow than dine in orders. Because it used to be a nightmare. Absolutely. Before the Chipotle, what happened? You had Uber Eats drivers, DoorDash drivers, mobile order pickup customers, and your traditional walk in diners all funneling through the exact same front door. Just a massive traffic jam. They are all staring at the same single make line, the line is out the door, the digital orders are piling up behind the register, the delivery drivers are getting impatient, it creates massive operational friction and ruins the experience for everyone. You are cannibalizing your own dining business because your digital business is too successful. Precisely. The Chipotle is not a traditional drive-thru where you ordered a speaker box. It is exclusively for digital order pickup. So smart. It separates the digital traffic from the physical traffic. Before they even enter the parking lot. It is a physical architectural solution to a digital traffic problem. They built a secondary make line in the back of the house dedicated purely to digital orders, and a dedicated window to hand them out. It keeps the dining room serene and the digital fulfillment lightning fast. Exactly. And this physical adaptation to digital speed is happening behind the scenes too, way up the supply chain. We are looking at intelligence briefs from the American Bakers Association, the ABA, reporting on beverage warehouses and food distributors adopting voice picking tech to boost efficiency. This is fascinating from an ergonomic standpoint. How so? Well, in a traditional warehouse, a worker gets a paper list or looks at a tablet, drives a forklift to an aisle, looks for the palette, checks the list again, picks the case, and scans it. It's very stop and go. Lots of voiced in motion. Right. Voice picking technology outfits the worker with an AI-driven headset. The AI speaks directly into their ear, guiding them along the most efficient physical path through the warehouse. Like GPS for the warehouse. Exactly. It says aisle four, shelf B, pick two cases of zero sugar cola. The worker verbally confirms, picked. And the AI immediately gives the next command. Their hands and eyes never leave the product. That is incredibly efficient. It drastically reduces picking errors and shaves seconds off every single movement. So seconds turn into minutes, minutes turn into hours, and hours are labor dollars saved. So bringing this all together for the operator listening to us right now, we have covered AI dynamic pricing, API integration, closed loop ecosystems, the Chipotle Lane architectural shift and warehouse ergonomics. That's a lot of tech. It is. So what is the actionable takeaway? If you are managing a hotel or a restaurant group, what do you do with this intelligence today? Your mandate for this quarter is to conduct a ruthless tech stack audit. I want you to apply what I call the two screen rule. Ooh, the two screen rule. I like that. Yeah. Walk into your manager's office. If your manager has to look at two different screens or log into two different portals to figure out why your labor percentage was high on Tuesday, your tech stack is failing you. It's too fragmented. Exactly. Sit down with your team and map out every single piece of software you pay a monthly subscription for. If you have siloed point solutions, like if your scheduling app requires a human being to manually export a CSV file to sync with your payroll processor, or if your POS data isn't automatically updating your theoretical food costs, you are bleeding cash on administrative inefficiency. You have to consolidate into platforms that share an open API. Right. You have to fire the cooks who only speak one language and hire a bilingual team. Exactly. And the second mandate is physical. You need to audit the traffic flow of your building. Stand at your host stand or your front desk for one hour during a peak digital volume period. Just observe. Watch how a digital order or a mobile check-in flows through your physical space compared to a traditional guest. If your physical space is creating bottlenecks for off premise sales or mobile guests, your physical footprint is becoming a liability. It's holding you back. You have to adapt your space. Whether that means designated pickup shell veim, a separate entrance for couriers, or remodeling to add a drive-thru lane, you must adapt to the reality of digital first pickup formats. That is spot on. The two screen rule and the physical flow audit. Very clear directives. But as we transition into the next phase of our deep dive, I have to point out the massive elephant in the room. ⁓ there's always an elephant. You can have the most perfectly integrated API in the world. You can have an AI algorithm pricing your menu with mathematical perfection. You can build 1,500 beautifully designed drive-throughs. But none of it means absolutely anything if you don't have the human beings to actually run the shift. That is the truth. The human element is the ultimate bottleneck. It is where the theoretical perfection of technology meets the messy emotional friction of the real world. And that brings us squarely into operational strategy. We are talking about culture. The ongoing labor crisis and menu execution. I want to start this with a piece of leadership intelligence from David Scott Peters that hit my desk, and it is highly provocative. He always brings a unique perspective. He is a prominent restaurant coach, and he argues point blank that it is vastly better for your bottom line and your sanity to purposefully run a shift short staffed than to keep the wrong employee on the team just to have a warm body on the floor. For a manager staring down a Friday night dinner rush with a full reservation book and a patio that just opened, purposefully choosing to run a man down sounds like operational suicide. It sounds terrifying. It is a terrifying proposition. It really is. It goes against every instinct you have as an operator. You just want the slot filled. But Peters introduces this radical three-word framework for analyzing and dealing with underperformers. He calls it no can. Choose. It is a brilliant distillation of foundational leadership psychology. When an employee is failing to meet your standard, it is almost always rooted in one of these three words. Walk us through it. Let's break them down. First is no. Is this a knowledge problem? Have you, as the leader, actually trained them on the standard operating procedure? Right. Did they shadow a trainer? Do they have a manual? Or Did you just hand them an apron, throw them on the line during a rush, and hope they figure it out? Which happens way too often. If they don't know how to do the job, that is entirely a failure of management. You cannot punish an employee for your failure to train them. Exactly. You remedy a no problem with immediate structured training. The second word is can. Is this a capability problem? Like they've been trained. They have been trained, they know exactly what the standard is. But physically, mentally, or temperamentally, they just aren't suited for the specific demands of the role. Look, you cannot train someone to be seven feet tall. True. And you cannot always train a quiet, deeply introverted person to be a booming, high energy expediter who commands a kitchen. They might be a brilliant pastry chef, but they cannot expo. So for a can problem, you don't necessarily fire them, you reallocate them. You find the seat on the bus that fits their capability. Right. But then we get to the third word. Choose. This is the lethal one. This is the danger zone. They know exactly how to do the job. They are fully capable of doing the job at a high level. But they choose not to. They just don't care. They choose to ignore the standard. They choose to take shortcuts. They choose to gossip, to roll their eyes. To be openly toxic to the rest of the team. I want to illustrate exactly how dangerous a choose employee is because the old cliche is that they are a bad apple or a spoiled oyster in a stew, but that doesn't really explain the mechanism of the damage. Right. It's too passive. A toxic employee isn't just a piece of bad food. Think of your team as a finely tuned manual transmission in a high performance car. A choose employee isn't just a broken gear, they are a handful of sand thrown directly into the gearbox. They create massive friction against every other moving part. When you have a toxic cook on the line, your best line cook suddenly has to slow down to double check their work. Your expeditor has to start shouting because the rhythm is broken. Exactly. Your servers are terrified to ask for modifications because they know the toxic cook will yell at them. The sand grinds down the good gears until the entire transmission ceases up. That is exactly what happens. And the insidious part is that the true cost of that sand in the gearbox. Never shows up on your PL statement. Never. You will never see a line item at the end of the month that says cost of toxic line cook $4,000. But you pay for it anyway. You pay for it in ways that destroy your business from the inside out. You see it when your best, most reliable shift manager suddenly hands in their two weeks' notice because they are completely burned out from constantly compensating for that toxic cook. The silent killer. to fix mistakes. You see it in increased turnover among your top performers. Your best people will deeply resent you if you force them to work in a sandbox with someone who drags the culture down, just because you were too scared to run the shift short staffed. That brings tremendous clarity to Peter's point. Running short staffed with a tight, aligned, positive team is actually more efficient and physically faster than running fully staffed with a saboteur in the ranks. Without a doubt. Your good team members will rally if they know you have the courage to protect the culture. They will run through walls for you. Which perfectly transitions into the macro labor data we are looking at. The National Restaurant Association, sponsored by Jazz HR, just released a major report called Made in Restaurants. And what's the angle? The entire focus is on shifting the perception of the hospitality industry workforce. And we desperately need a rebrand. For decades, hospitality has suffered from a terrible public relations problem regarding labor. It really has. It has been viewed by the general public as a transient job, a temporary stepping stone, a place for high school kids, or a warm body role until you find a real career. Right. And the NRA is pushing heavily to reframe this narrative. They are providing data to show that hospitality is a legitimate pathway to long term career leadership, executive management, and entrepreneurship. And operators have to embrace this rebrand because Look at what we are actually asking these employees to execute on a daily basis. The expectations are sky high. You cannot hire a transient warm body and expect them to execute the level of culinary complexity that is required to survive right now. Menu innovation is wildly complex. Brands are leaning heavily into Gen Z-focused limited time options, LTOs, to drive foot traffic and social media engagement. The LTO strategy is in absolute overdrive across every segment of the industry. It is the primary lever for generating artificial urgency. Let's look at the sheer volume of this. Sweet Green just brought in internet famous cookbook author Molly Baz as their first official chef in residence to design exclusive bowls. Right. Starbucks just unveiled this wild concept called the arocono. Tipotle revived their Halloween burrito margaritas for an exclusive pop-up tour. Trader Joe's brought back the viral Halloween mini totes that people literally fight over in the aisles. It's chaos. And Grubhub just launched a program called The Drop, which is explicitly designed to drive physical dine-in visits through exclusive limited release merchandise or secret menu drops. Let's pause and look at the Starbucks aerocano, because that perfectly illustrates your point about labor complexity. Okay, lay it on this. What is an aeropano? It is a modern, highly specific iced espresso drink where the barista has to use the steam wand to aerate cold espresso and ice together. To create a nitrogen-like creamy texture without actually using dairy or a nitro tap. It sounds delicious, but operationally that is a nightmare. Exactly. Think about the physical mechanics of that. You are asking a barista during a morning rush with a line of 20 mobile orders to perfectly execute a highly technical aeration technique that goes against the standard use of the steam wand. Because normally the steam wand is for hot milk. Right. If they over aerate, it's a mess. If they under aerate, It's just a cold espresso, and the customer complains. You cannot hand a complex multi-step LTO manual to an unengaged, untrained teenager and expect consistency. You certainly can't. And if we look at the American Culinary Federation's 2026 What's Hot Culinary Forecast, the complexity is only increasing. ⁓ it's getting wilder. The data shows a massive consumer demand for chef-driven innovations in hyperspecific, nature-inspired flavor profiles. We are seeing things like Chef Matt McAllister debuting his new concept, Riversing, in Dallas, focusing on intricate sourcing. It's beautiful food. Aaron The forecast highlights the rise of menus featuring things like charred grape and end-ive salads with Roqueford cheese and black pepper honey. We are seeing a huge surge in Californian dates and highly complex layered flavor builds. Aaron And look, a charred grape and end-ive salad does not just make itself. No, it does not. It requires precise temperature control on the grill, so the grapes blister but don't burst. It requires careful plating. The Gen Z consumer is driving this demand because they want visually striking, hyper-specific flavors that look incredible on camera and offer unique sensory experience. But the margin for error on these LTOs and complex dishes is absolute zero. Exactly. If a customer comes in specifically for the Molly Baz bowl or the charred grape salad, and your line cook throws it together sloppily because they are a choose Problem employee who hates their job. That customer isn't just going to quietly never come back. No way. They are going to pull out their phone, film a negative review, and broadcast your failure to 5,000 people on TikTok. Which is precisely why culture is the absolute non-negotiable prerequisite for output. You cannot decouple your high-end menu strategy from your ground level labor strategy. If you want a 2026 menu, you need a 2026 workforce. Perfectly said. So bringing this down to the floor, what is the actionable takeaway for our listeners who are fighting this exact labor and execution battle right now? First, I want you to apply David Scott Peters' no can choose framework today. Think of the lowest performing staff member on your roster. Just picture them right now. Run them through the matrix. If it is a no problem, pull them aside today and schedule dedicated training hours. If it is a can problem, analyze your operation and move them to a role where they can succeed. But if they are a choose problem. But if you realize they are a choose problem, if they are the sand in your gearbox, you must terminate them. Give them a forty-eight hour ultimatum to correct their attitude. And if they don't, cut them loose. Run short staff this weekend. Protect your top performers at all costs. Excise the toxic element to save the whole machine. And what about bringing new people in? Your second mandate is to completely rewrite your recruitment marketing. Stop putting out ads that just say line cook wanted $18 an hour. You'll only attract mercenaries. Right. You need to use the findings from the NRA's Made in Restaurants report to sell a comprehensive career pathway. You have to sell leadership development. And there are incredible tools available right now to help you do that. Look at the briefs we have from ProChef. Those are great resources. The Culinary Institute of America is now offering fully online master's degrees in food business. The American Culinary Federation is pushing extensive food safety and management webinars. You should be leveraging these as internal growth incentives. Absolutely. You sit down in an interview and say, look, we will pay your hourly wage, but we will also pay for your ACF certification when you hit your six month milestone. We are going to build your resume. Exactly. You want to build professionals, not rent hands for a season. When you invest in their intellectual capital, They will invest their discretionary effort into your arocanos and your charred grape salads. I love that framing. You are building professionals. But here is the harsh reality check for every operator listening. Brace yourselves. You can build the most incredible, highly trained culture. You can curate a team of absolute professionals who flawlessly execute your complex menu. But while you are battling it out on the floor, There are massive tectonic plates shifting above your head in the C suite and the global supply chain. The macro environment is unforgiving right now. And these macro shifts are ultimately going to dictate what ingredients you can even get your hands on and what you are going to pay for them. Yeah. We're moving out of the four walls of the restaurant and into the global macro environment. And the level of corporate consolidation and supply chain volatility happening right now is genuinely staggering. This brings us to the third phase of our deep dive, regulatory compliance and macro consolidation. Let's start by analyzing the mergers and acquisitions activity because there is massive capital moving around. Big money. Hormel is aggressively targeting food service growth, and they just dropped one billion dollars to acquire the chicken processor breakpoint. That is a tectonic shift in the protein supply chain. Hormel is already a global giant in packaged foods and pork. By absorbing a massive dedicated poultry processor like Brake Bush, we are witnessing intense vertical integration. Hormel is buying up the processing capacity, so they control the product from the farm all the way to the delivery truck. And that changes everything. When a single corporate player controls that much of the physical processing infrastructure, it fundamentally shifts pricing leverage. And because there are fewer competitors in the market. If you are an independent restaurant owner buying cases of chicken breasts, Your distributor has fewer suppliers to choose from, which means you are going to feel that consolidation directly in your weekly pricing. Exactly. The illusion of choice disappears. And it is not just food supply where this consolidation is happening. Let's look at the hospitality and real estate side. Choice hotels just acquired a company called Harvest Hosts. Now, for those who aren't familiar with this space, Harvest Hosts is a fascinating network. It is a membership program that allows RVers and van lifers To stay overnight for free at non-traditional locations. Aaron Like wineries. Yeah, wineries, working farms, breweries, and golf courses. It is essentially the backbone of the experiential glamping and road trip economy. Aaron And what makes this acquisition so significant is who is doing the buying. Joyce Hotels is a very traditional legacy mid scale hotel operator. They run the comfort ins and quality inns of the world. Aaron Right, very standard properties. Aaron The fact that they are buying an RV glamping network shows that Traditional legacy brands recognize they are losing ground to the experiential economy. The modern traveler's definition of a hotel stay is rapidly expanding. People don't just want a rectangular room off the interstate anymore. Exactly. They want an experience. They want to sleep next to a vineyard or wake up on an alpaca farm. Legacy brands realize that building this kind of experiential footprint organically takes decades, so they are simply buying their way into the market. Meanwhile, as Choice Hotels expands its portfolio, Expedia Group is contracting. We are seeing reports of massive job cuts at the travel giant. Which is a very strong signal of a cooling or at least a significant strategic restructuring in how traditional online travel agencies, the OTAs, are operating. Yeah, that's been a long time coming. For the last decade, independent hotels and major brands alike have been fighting a bloody war to drive direct bookings and escape the massive 15 to 20 percent commission fees. Charged by OTAs like Expedia and Booking.com. Which just eat margins. Expedia's cuts might indicate that the macroeconomic environment is slowing down travel spent, or, more optimistically, for operators, that hotel direct booking loyalty strategies are finally starting to successfully bleed the OTA margins. We are also seeing major executive musical chairs across the food sector as companies scramble to adapt. General Mills just named Dana McNabb as their next CEO. Big move. El Pollo Loco is aggressively pushing out of their core Western markets and targeting the East Coast for a massive national expansion, which is going to completely alter the QSR competitive map for chicken concepts. They are coming in hot. And Red Lobster, which has been very publicly trying to pull out of a catastrophic financial nosedive, just recruited a major ad agency executive, Andy Pitts, as their new marketing chief to try and salvage the brand narrative. It is an industry indeed. Deep flux at the executive level. But honestly, the boardroom shakeups are secondary to what is happening on the ground in the physical supply chain and the regulatory environment. The earth is shifting. And the curveballs are massive. Let's run through these supply chain shocks because they are wild and they have immediate menu implications. First, agricultural authorities have discovered emerging pathogens in Brazilian citrus fruit. This is huge because Brazil is a massive exporter of citrus juice and oils. A pathogen outbreak means immediate quarantines, export blocks, and a devastating threat to the global beverage and garnish supply chain. If you run a cocktail bar that relies heavily on fresh lime juice, or you use imported citrus oils for your pastry program, you're about to see a massive spike in costs, if you can even get the product at all. It's a real threat. Second, there is a severe global shortage of whey protein right now. This is a critical foundational ingredient. Whey protein is a byproduct of cheese manufacturing. And it is the absolute backbone of the health, smoothie, and commercial baking space. It's in everything. It provides texture, hydration, and binding properties. The shortage is so severe that food science startups are absolutely racing to formulate soy, pea, and bean alternatives just to fill the gap. But as any baker knows, switching from a dairy-based whey to a plant-based soy protein is not a simple one-to-one swap. The hydration ratios change, the texture changes. The flavor profile gets earthier, it creates a formulation crisis. You basically have to rewrite the recipe. Third, and this one hurts my soul a little bit as a food lover, pizza chefs are reportedly abandoning traditional wood-fired ovens. Look, this isn't a culinary choice. It is an economic and regulatory reality. Explain that. The rising costs of sourcing quality hardwood, combined with the incredibly strict new emissions and environmental compliance laws in major municipalities. Are making wood fired ovens financially and legally unviable for independent operators. So what are they doing? They're being forced to transition to high-end gas or electric deck ovens just to stay compliant with local clean air ordinances. And finally, looking at macro compliance, Nestle has officially announced a hard public target to cut their use of virgin plastic by 17% by the year 2030. When a behemoth like Nestle makes a structural supply chain commitment like that, it isn't just a PR stunt. They have an army of analysts and they are reading the regulatory writing on the wall. They know it's coming. They know that global governments are preparing to tax or ban single use virgin plastics. They are aggressively redesigning their packaging now to avoid crippling compliance fines later. Operating a restaurant or a hotel right now is quite literally like playing a high stakes game of chess, but every five minutes the board shrinks. That's exactly what it feels like. You have fewer suppliers to choose from because billion-dollar giants like Hormel are buying up the processors. Your distribution channels are shifting as OTAs cut staff. Your core ingredients like Brazilian citrus and whey protein are either vanishing due to disease or spiking in cost. And the compliance rules around how you cook a pizza or what plastic you put your to-go food in are tightening like a vice. Even the convenience store sector is feeling this exact same macro squeeze. We see reports that Sheets is aggressively expanding into Indiana, sparking a massive real estate turf war. Right. And the entire sea store industry is facing what trade publications are calling the four burning questions ahead of the NAX show, specifically regarding how to secure supply chain resilience and physical footprint expansion in a shrinking market. Everyone is fighting for the same limited resources. The overarching question here is whether we are witnessing the permanent end of traditional resource heavy hospitality models. In favor of hyper-efficient, eco-compliant, corporately consolidated mega operations. So I have to ask you the ultimate question. Put yourself in the shoes of the listener. If I am an independent restaurant operator or a mid-sized regional hotel group, how do I protect my king when the chessboard is actively shrinking? When giants like Hormel and Choice Hotels are buying up the playing field, how do you survive? Exactly. Your only defense against corporate scale is extreme operational agility. A giant like Hormel has massive pricing leverage, but they move like a cargo ship. It takes them miles to turn. But the independent operator. As an independent or midsize operator, you are a speedboat. You have to preempt the macro shocks before they hit your PL. Let's establish the actionable directives for this macro environment. We will call it the vulnerability matrix. Lay out the matrix. First, for the food and beverage operators, you must audit your supply chain vulnerabilities before you go home today. Look at your top ten most profitable menu items. Do they rely heavily on imported citrus? Does your pastry or smoothie program rely entirely on whey protein? If the answer is yes, you are fundamentally exposed to events completely outside of your control. Highly exposed. Highly. You need to start sourcing alternative formulations immediately. Do not wait for your broadline distributor to call you on a Tuesday morning and tell you they are out of way. Start reaching out to those startups and testing the bean, pea, and soy protein alternatives right now. Redesign your cocktail menu this week to incorporate local seasonal acids like malic or tartaric acid solutions or verdu, instead of relying entirely on imported Brazilian limes that might get blocked by a pathogen quarantine at the port. You have to engineer the risk out of your menu. Exactly. And what about the hotel side? How does a regional hotel group compete with choice hotels buying up the entire experiential market? You have to look at your own physical footprint through an experiential lens. Choice bought harvest hosts to monetize unused experiential space. If you operate a midsized hotel, look at your grounds. Like outside the building. Do you have excess land? Do you have a massive underutilized parking lot in the back? Can you partner with local experiential concepts, high end food trucks, or even Glamping pop-up companies to monetize that dead space. That's a great idea. You have to offer the unique localized experience that modern travelers are clearly demanding, turning your physical liabilities into revenue generating assets. Turn the parking lot into a destination. That is brilliant. And the final directive for everyone listening: restaurants, hotels, and sea stores concerns regulatory compliance. You must proactively ensure your packaging suppliers are aligning with incoming sustainability standards. Right. The Nestle example. Nestle moving to cut virgin plastic by 17% is the canary in the coal mine. If your takeout operation is still heavily reliant on noncompliant single-use virgin plastics, you need to transition your sourcing to compostable or post-consumer recycled materials immediately. Do this before you are hit with local municipal regulatory fines. Or before a sudden supplier bottleneck leaves you with no boxes to put your food in. You have to get ahead of the law before the law becomes a devastating line item on your PL. Precisely. Agility, foresight, and adaptation. We have covered an immense challenging amount of ground today. We started by dissecting the digital brain of the operation with AI pricing and API tech stacks. We moved into the human heart of the culture with the labor crisis and complex menu execution. And we finished by examining the macro skeleton of the global supply chain and the reality of corporate consolidation. We've talked about the math of algorithms, the courage to fire the toxic employee, and billion-dollar corporate acquisitions. Yeah. But the real provocative question I want you to ask yourself on your drive home tonight is this. If your primary food supplier gets bought out tomorrow and your costs skyrocket, and simultaneously your best shift manager quits because they are exhausted by a toxic employee you refuse to fire. Is your brand's internal culture strong enough? And is your team resilient enough to survive the week? That is the real question. The technology and the tools are out there to help you, but the ultimate resilience has to come from you, the leader. That wraps up today's edition of Pulse, before you get back to your floor or executive suite, make sure to check out the other powerful shows in the HRB Universal Network. You definitely want to check these out. Kitchen to C Suite, your definitive roadmap for advancing hospitality careers from entry level up to executive leadership. It's a great roadmap. Mise en place, culture first leadership and organizational strategies focused on safety, compliance, and building top-tier workplace culture. Essential listening. The Recipe for Results Podcast Extra. Fast, high impact extras packed with operational tactics and actionable solutions. Always super actionable. 86ing the bad habits, cutting out systemic operational flaws, bad leadership habits, and inefficient practices across hotels, bars, and restaurants. We all have bad habits to break. This podcast is supported by the generous commitment of our sponsors, and we extend a special thank you to HRB Universal, their dedication to providing comprehensive resources and promoting excellence. Is key to empowering professionals across the culinary and hospitality industries. We really appreciate their support. We also want to acknowledge the Plate and Poor Collective Equity Partner Program. This initiative exemplifies a true commitment to fostering shared success and equitable growth within the food and beverage sector, helping entrepreneurs build a more inclusive and thriving future. It's an incredible initiative. The journey to the C-suite is fueled by innovation, relentless dedication, and the right network. We encourage you to engage with the resources and support offered by our sponsors. Absolutely. For details on how to connect with HRB Universal and the Plate and Poor Collective Equity Partner Program, visit HRBuni.com or search HRB Universal online. Go check them out. We look forward to having you join us for our next episode where we will continue to explore captivating topics designed to elevate your career and entrepreneurial drive. Can't wait for the next one. Stay ahead with Pulse, today's hotel, restaurant, and bar industry news deep dive. Brought to you by HRB Universal. Don't miss a beat. Whether you're commuting to work or unwinding on the couch, we've got your industry insights covered. We're everywhere you are. On the go, subscribe and listen on Apple Podcasts, Spotify, YouTube, Amazon Music, Audible, iHeartRadio, Deezer, or visit hrbuni.com. Whatever app you prefer. Mobile app? 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