DENVER — From lower tips to the kinds of milk people order in their coffee, Coloradans' restaurant habits are changing. New data from Square shows recent trends and how they're impacting the industry.
You may have noticed fast food prices starting to dip, in some cases back to their pre-pandemic levels. Ming-Tai Huh, the head of food and beverage at Square, said there are two main reasons behind this decision. First, he said the high prices were driving people away. And second, people are tightening their budgets.
"They're really seeking as much value for their money as possible," Huh said.
Huh also said online ordering is becoming much more common. Nearly 80% of restaurant owners said the biggest portion of their sales come from online ordering, but doing so costs customers and business more.
"If you're ordering online through a third party, third parties have commission fees," he explained. "Restaurants compensate for those fees by having higher menu prices through their third-party apps."
Huh said you can save money by ordering directly from the restaurant and that actually helps restaurants save money too.
One place where you might save money is on milk in your coffee. Huh said in Colorado, more than a third of coffees ordered have an alternative milk, like oat milk. It used to be a big upcharge, but Huh said that's changing.
"We're seeing the average cost of it drop," he said. "It used to be a luxury preference, but it's actually becoming more common," he said.
One of the biggest changes is tipping habits. Nationwide, the average customer leaves a 19.1% tip at restaurants, according to the software company Toast. That's the lowest number the company has recorded in the last seven years.
"This is affecting restaurants of all types; bars, full service, fine dining, and quick service are all seeing declines," Huh said. "This in turn actually also affects restaurant workers."
He added the state of the economy is driving people to tip less.
Earlier this year, Colorado Governor Jared Polis signed a bill into law that changes minimum wage for tipped workers. Under this new law, the base pay for tipped workers can be lower than minimum wage, as long as they make up the difference or more in tips. If they don't make up the difference, they'll still have to be paid minimum wage. Supporters said it should help restaurants struggling to pay their employees.
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