U.S. consumers are becoming increasingly sensitive to rising inflation, but Red Lobster is offering them value, the company's CEO, Kelli Valade, said on a Bloomberg Businessweek Podcast.
“The consumer is still very sensitive to all the price increases that are happening – all the things happening around inflation – they feel that, they know that,” Valade said. Tax returns being smaller this year will also have an impact on the “consumer headset,” Valade said.
"We are doing everything we can to price under where inflation is and still have great value-forward offers. People count on us for that,” Valade said.
The Orlando, Florida, U.S.A.-based privately-owned seafood chain recently introduced a new “10 Under USD 10.00" (EUR 8.96) lunch menu that includes a variety of selections, including Garlic Shrimp Scampi, Crispy Cod Sandwich, and Popcorn Shrimp.
The 10 Under 10 weekday lunch menu, along with the recently introduced "3 from the Sea" combination, appear on Red Lobster’s newly designed menu, “providing great value options for guests no matter when the craving hits,” Red Lobster said in a press release.
Even though the restaurant chain faces supply chain pressure, parent company Thai Union is “able to help us wherever possible and provide great solutions for us,” Valade said. Thai Union supplies shrimp and a few other seafood species for the chain, she noted.
Despite labor challenges across the foodservice sector, Red Lobster has had increasing success with hiring and retaining employees.
There is “some stabilization of the workforce,” said Valade, adding that the restaurant chain plans to hire around 50,000 employees this year.
“We are being able to retain the folks we have, and are able to hire and look for great people on the supply chain side,” Valade said. “We are in a good place.”
Valade declined to reveal what Red Lobster pays its employees, but said the company has increased wages for hourly employees a little over 11 percent.
“We are competitive and are aware of what the industry is paying on the full-service side right now,” Valade said.
During COVID-19, Red Lobster tripled its off-premises (takeout and delivery) business. But restaurant visits are rising as the omicron variation wanes.
"Demand has certainly rebounded [and] we have lots of people in the restaurants,” Valade said.
Offering take-out and delivery is bringing in incremental guests as you “see people pivot to off-premise and to-go when they want to feel safe,” Valade said.
While the restaurant industry is facing numerous pressures, Valade said she has a positive outlook for 2022.
“[Consumers] want to be out at restaurants, enjoying time with friends and family,” she said.
Photo courtesy of Red Lobster
