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Restaurants in Denver Experience Steep Decline in Sales During 2024

TOAST | Denver restaurant sales dropped in 2024. (Photo/X)

OTHER CITIES SHOW GROWTH

Newsroom El Comercio de Colorado

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A recent report by TOAST, a point-of-sale (POS) technology provider, reveals that Denver experienced the most significant decline in restaurant transactions in 2024. According to the report, which examined restaurant data from October 1, 2023, to December 31, 2024, restaurant transactions in Denver dropped by 9%, making it the most affected city among a total of 20 metropolitan areas in the country.

TOAST’s data on year-over-year (YOY) restaurant transactions revealed a sharp contrast in performance between cities. While cities such as Philadelphia and Chicago saw positive growth, with each increasing by 3%, Denver and Tampa faced a drastic slowdown. Denver’s 9% drop in transactions stands out, followed by Tampa, Florida, with a pronounced 6% decrease.

Contributing Factors

The data clearly shows how restaurants in these cities, especially in Denver, are struggling to keep up with rising costs and consumer hesitation. Experts point to increasing regulations, rising utility and insurance costs, food inflation, and higher labor expenses as key factors.

These factors have placed pressure on restaurant margins, making it difficult for businesses to remain profitable. In addition to these financial challenges, consumer behavior is also changing. Fewer consumers are dining out due to higher menu prices, parking fees, mandatory service fees, and higher tips.

Diners Speak Out

On the social media of the Colorado Restaurant Association & Foundation (CORestaurants), one consumer commented, “While we enjoy trying new restaurants and supporting local businesses, the rising costs of dining out, due to higher menu prices, tips, and parking, have made us dine out less and stay closer to home.”

Another comment on CORestaurants’ social media says, “The combination of higher wages for staff and rising food costs is putting pressure on restaurant budgets. We have to be much more selective about when and where to dine out.” “I personally felt the impact of inflation. For me, the message is ‘this is not the time for restaurants’,” another comment reads.

Despite these challenges, the TOAST report and the comments on social media highlight deeper issues within the industry. While inflation and rising costs are significant factors, the key question remains: What other factor is driving customers away from Denver restaurants? The answers seem to lie in a combination of higher dining costs and the inconvenience of additional fees.

Technical Note

It’s important to note that TOAST’s report only covers restaurants using its POS system, which accounts for approximately 134,000 restaurants in the U.S. This represents just 18% of the market, as there are around 749,000 restaurants in the country. Some industry experts have questioned whether the data fully represents the entire restaurant sector, but even with this limitation, the report highlights critical issues.