Restaurant workers need better work environments and benefits: MTY Food Group CEO on labour shortage
Higher prices have become “a fact of life,” according to the chief executive of quick-service restaurant franchisor and operator MTY Food Group Inc.
Montreal-based MTY, which operates more than 70 brands ranging from ManchuWok to Jugo Juice, Cold Stone Creamery and Mucho Burrito, said Friday it has managed to reopen hundreds of its locations in recent months. MTY had 359 restaurants closed as of June 1, but only 139 remained shuttered as of Friday morning.
The lifting of pandemic-related restrictions helped MTY push system-wide third-quarter sales to more than $1 billion, representing a 13 per cent increase from the same period in 2020. However, CEO Eric Lefebvre said on a conference call Friday morning that the company is struggling to find staff.
In an interview Friday afternoon, Lefebvre said the combination of labour shortages and food price inflation driven by supply chain disruptions had forced most MTY restaurants to raise their prices.
“Definitely there is going to be inflation in the cost of people and there is going to be inflation in the cost of the food we need to buy,” Lefebvre said. “That is factored into our pricing strategies since obviously the restaurant industry works with relatively slim margins; so we need to be very cautious of how we try to absorb some costs because we can’t really absorb that much.”
“We need to cautiously look at price increases for some of our restaurants -- try and monitor what is going on in the industry and avoid pricing ourselves out, but also try and maintain our franchisees’ margins in any way we can,” he said.
Adding to the pricing pressure, Lefebvre said, are increased labour costs as MTY has needed to “be creative in how we attract people.”
“Money is definitely one item that will attract people, but we need to do a little bit more than that,” he said. “Everybody can offer a dollar more per hour, but you need to offer a better work environment and maybe you need to add some other benefits or some other perks to try and attract employees. That is ultimately what is going to make a difference.”
In an emailed response to questions about where MTY’s 139 restaurants that remain closed are located, Lefebvre said “the majority are in airports, movie theatres, health clubs, colleges etc.”
“We also have some locations in major urban centres that are only relevant if business people come back,” he said, noting “restaurants in the PATH in Toronto are a good example.”
Food price inflation is, of course, not limited to any one business.
“Price increases are a fact of life,” Lefebvre said. “Anybody who goes to a restaurant will be able to witness it in any restaurant they visit, whether it is MTY or our peers.”