Restaurant business has been 'hit or miss' this year, says CMR's Cameron Mitchell

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joining us right now for a check on the consumer and spending is cameron mitchell he's the founder and CEO of cameron mitchell restaurants that firm operates fifty restaurant locations under twenty concepts plus an events company a food hall and a virtual kitchen and cameron

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correct me if i'm wrong i think you're operating in twenty one twenty nine states at this point

Cameron Mitchell (Founder & CEO) 00:20.830

about actually half that about fifteen states twenty nine different markets

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twenty nine different markets OK thank you cameron first of all welcome it's great to see you we've been talking to you i think for the better part of the last six years about how things have been going in the restaurant business we started back in twenty twenty right after

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covid how are things at this moment for the longest time it was the shutdowns with covid then it was inflation that were your big issues but but how's business looking at this point

Cameron Mitchell (Founder & CEO) 00:51.440

well i i think we're going to look at twenty twenty five and in context we we started out horrible in twenty twenty five first quarter was down significantly start april same thing and then it started to turn in may we've had now seven months of same store sales increases we're

Cameron Mitchell (Founder & CEO) 01:08.600

seeing traffic starting to rebound a little bit you know we raised our prices two percent this year which is half of what we would normally do because of our and we're worried about our concerns we know they're getting close to their their limit but all in all you know with the

Cameron Mitchell (Founder & CEO) 01:27.950

at the end of the year we'll end up flat in terms of traffic even though we're seeing some improvement right now and we'll end up you know two percent or so in the same store sales which really reflects our price increase so you know it's been hit or miss this year we started

Cameron Mitchell (Founder & CEO) 01:43.510

out this year very worried about tariffs the impact on tariffs interest rates and and our cost of capital was very difficult to continue at that and we decided to stop any new leases setting new development for the time being just on the economic uncertainty and coming out of

Cameron Mitchell (Founder & CEO) 02:03.030

the year in twenty twenty five and looking forward to twenty twenty six we're feeling a little bit more optimistic we we know cost of goods will come back in line meet with its all time high after labor day through the holidays here but we're seeing some relief on the horizon

Cameron Mitchell (Founder & CEO) 02:18.670

with that labor market continues to be great back to pre pandemic levels you know wage inflation is in that four to five percent range for us and and so and with interest rates a little better line of sight on interest rates and the impact on tariffs we're pretty optimistic

Cameron Mitchell (Founder & CEO) 02:36.590

about twenty twenty six going forward here in the in the new year yeah cameron

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you you mentioned that interest rates were higher and that was putting pressure and you didn't want to expand into new businesses as a result the fed has lowered interest rates as has it has it helped

Cameron Mitchell (Founder & CEO) 02:52.270

yes well in terms of cash flows it definitely helped and we've renegotiated some of our debt and lower interest rates even further so we feel that's in a good spot so everything is kind of teed up for twenty twenty six to be a good year it's all going to get down to the consumer

Cameron Mitchell (Founder & CEO) 03:09.550

and and and they're going to make the final decision on what kind of year we have next year

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you say so far holiday gift cards are trending up this year and and catering for the month of december parties that people are having around the holidays that's up to yes

Cameron Mitchell (Founder & CEO) 03:23.550

just through the gift circuit season right now that it ends in a couple more weeks so they're up seven percent over last year and our catering business has had a really a terrific december so both those signs are also optimistic for going forward the

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the issues in terms of inflation you mentioned that you're only raising prices two percent this year versus the four percent you normally will would that that means you inflation is not an issue for you right now

Cameron Mitchell (Founder & CEO) 03:52.230

well it is on our our inbound pricing you know it is everything 's gotten a little more expensive we have just tried not to raise the price we we want to take more price but we feel like the consumer is already kind of getting close to their limits so we we were trying to be

Cameron Mitchell (Founder & CEO) 04:09.280

very conservative on that approach thus far so we'll see yeah we'll see where that gets us but we think it's the right right positioning for us and how's the

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labor market how how is it just in terms of being able to find out

Cameron Mitchell (Founder & CEO) 04:22.630

it's been good you know you can see in the headlines these past few few months it is there has been a little bit of a softening in the labor market we are finding steady applicant flow and and good applicant flow for us and good applicants themselves so it's it's been pretty

Cameron Mitchell (Founder & CEO) 04:37.910

good we're we're still giving healthy raises out but and i think but that's a good thing the whole restaurant industry itself over the past several years has reset with labor and and so i think we're in a good spot and and again i feel optimistic going forward