Minimum Wage Hikes in New York City Cause Restaurants to Eliminate Jobs, Cut Hours, Raise Prices

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“New York is known for its incredible food scene, but legislators in the Big Apple may have bitten off more than they can chew with the newest minimum wage hike.

The city’s mandated increase, which took effect on December 31, requires businesses that employ 11 or more people to boost wages from $13 to $15 per hour. But most restaurants operate with the tipped wage, offering servers and bartenders a lower hourly base pay and the opportunity to rake in the rest in tips, which often yields better pay overall. If workers don’t earn enough this way, employers are required to make up the difference.

That tipped minimum just rose from $8.65 to $10 an hour. A 16 percent jump is fairly punishing, considering the industry operates on razor-thin profit margins.

A new study conducted by the New York City Hospitality Alliance lends credence to the idea that substantial increases made to the tipped wage are far costlier than they are beneficial. After surveying 574 restaurants, they found that 2019 looks bleak: 75 percent of full-service establishments plan to cut employee hours, and 47 percent will eliminate jobs entirely in response to the forced minimum wage hikes. That follows closely on the heels of a dreary 2018, when 77 percent of full-service restaurants reduced employee hours and 36 percent cut jobs, both of which were also in response to the mandated wage increases.”

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New York City on sale: Deep discounts on shows, restaurants, hotels starting Jan. 21

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New York City is appealing to visitors for countless reasons, but price is not usually one of them.

But starting Jan. 21, the city will be at its cheapest thanks to a new initiative called NYC Winter Outing organized by the tourism marketing association, NYC & Company.

For the first time, NYC Restaurant Week, NYC Broadway Week and NYC Must-See Week will take place at the same time.

That will result in some of the lowest hotel rates of the year, shopping sales, theater, restaurant and attraction/sightseeing deals.

About 400 restaurants will participate in NYC Restaurant Week from Jan. 21 to Feb. 8. Diners will get two-course prix-fixe lunches and brunches for $26, with three-course dinners for $42.

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Why Restaurants Struggle to Eliminate Tips

“It’s been three years since Danny Meyer became the unofficial leader of a movement to abolish tipping at restaurants, in an effort to level the playing field for front-of-house and back-of-house employees, among other things. In the process of converting his own restaurants to his so-called Hospitality Included model, he convinced a number of major restaurateurs to adopt similar pay structures. The upside, of course, is that these tip-free models theoretically decrease pay discrepancies between people who work in the dining room and the kitchen, and don’t rely on diners to essentially supplement workers’ incomes.

But after giving it the ol’ college try, two major restaurants have returned to the old way of doing things. The Wall Street Journal reports that Agern, the Nordic restaurant from Claus Meyer, and Michelin-starred Cafe China in midtown have both returned to the traditional tipping model and have seen great results.”

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Best Restaurant POS Tools: How to Choose the Right System for You

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“Understanding the needs of your restaurant is a most important first step in choosing the best POS software. After all, the needs of a small brewery with no food service differ greatly from those of a large restaurant. To assess your needs and find the best restaurant POS system for your growing establishment, here are a few things to consider.”

“You’re likely already using tools to manage your accounting, payroll, food costs and scheduling. These tools are essential for the daily operations in your restaurant. That’s why we suggest choosing a POS system that integrates with these tools that you already use. This will reduce the organizational disruption in your restaurant and ensure that your POS leverages data from the past to make more informed suggestions for the future.”

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How Hudson Yards Chose Its 25 Restaurants

“On March 14, 2019, Hudson Yards will fully open its eastern portion. Twenty-five restaurants will fire up the stoves. More than 100 stores will fling open their doors. Marquee companies like BlackRock, Wells Fargo, and HBO will occupy office space. An entirely new neighborhood will spring into existence in what seems like an instant.

In reality, though, it’s taken mega-developer Related Companies over a decade to get to this moment. In that time, Hudson Yards — the stagnant rail yard area between 30th and 34th streets and 10th and 12th avenues — has turned into a modern adult playground of luxury retailers and restaurants, park space, and public events that have come to fruition through the vision of Related Urban CEO Kenneth Himmel.”

“Everything is designed to pull people in and up: the escalators, the open floor plan, Neiman Marcus starting on level five, the Keller and Estiatorio Milos flagships on five and six. Restaurants on higher floors are common in other countries, especially in Asia, but the format has not quite caught on in the United States — yet, if Himmel has his way.”

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New York restaurant La Sirena to close

New York restaurant La Sirena to close

“B&B Hospitality Group’s New York City restaurant La Sirena is scheduled to close after the end of the year, the company confirmed on Tuesday.

“We are very proud of our hard-working, dedicated professionals who deliver great dining experiences to our guests every day. Our guests know just how special La Sirena is, and we’re grateful for their patronage,” the statement said.

Batali, who co-founded the company with partners Joe and Lidia Bastianich, opened La Sirena in 2016. According to Eater, the restaurant began struggling even before Batali was accused of sexual misconduct. Batali is the subject of both civil and criminal investigations.

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Opportunities: CohnReznick Presents 2015 Hospitality Webinar Series

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CohnReznick LLP, one of the top accounting, tax, and advisory firms in the United States, will hold the second session in their Hospitality Webinar Series on May 21st titled The Technology Landscape: Understanding What You Need and What Works. This webinar will cover the past, present and future of hospitality industry technology and identify the best platforms based on a company’s technological need. The webinar will be moderated by Christopher Mahon, Partner at CohenReznick and will feature James McGhee, Partner at Results Thru Strategy. Screen Shot 2015-04-28 at 12.39.44 PM

The series goal is to present webinars focused on the financial and operational issues that face hospitality companies. Other upcoming topics for the series include Public Relations and Social Media Strategies, The ABCs of Lending: The Finance Market for Restaurants, Both Big and Small and Legal Issues for the Hospitality Industry.

CohnReznick, headquartered in New York, offers specialized services for middle market, Fortune 1000 companies, private equity and financial services firms, government contractors, government agencies, and not-for-profit organizations. Founded in 1919, they have over 300 partners, 2700 plus employees and bring in an annual revenue of more than $500 million dollars.

To register for this webinar, please click here