Seven Critical Insights for Restaurant Leaders: Navigating Wage Increases, Technology, and Tipping Culture
With California’s fast food minimum wage now set to rise to $20 per hour, the restaurant industry faces a major inflection point—one that affects wages, operations, technology investment, and customer expectations.
In this timely episode of the Distinguished Podcast, Chris Simms, Founder and CEO of Lazy Dog Restaurants, shares candid insights on how to balance rising costs, care for employees, and keep businesses thriving in an increasingly complex environment.
This conversation goes far beyond policy—it’s about rethinking what leadership in hospitality means today.
 |
Chris Simms is the Founder and CEO of Lazy Dog Restaurant & Bar, a fast-growing, Rocky Mountain-inspired restaurant known for its handcrafted food and warm, lodge-style atmosphere. Since opening the first location in 2003, he has expanded the brand to over 40 locations across eight states, employing more than 5,000 team members. A lifelong hospitality professional, Chris began his career at 14 and earned his B.S. from Cornell University. He lives in Manhattan Beach, California, with his wife and four children.
|
1. Wage Increases Will Accelerate the Push Toward Automation
“With every additional dollar of labor cost, investing in technology becomes more credible.”
As labor becomes more expensive, restaurants are doubling down on automation—from ordering tablets to kitchen robotics—to control costs while maintaining service levels.
2. The Ripple Effect on Full-Service Restaurants is Real
“Even if the law targets fast food, it pressures all restaurant wages upward.”
Raising fast food wages sets new employee expectations everywhere. Full-service operators must prepare for ripple effects as kitchen staff seek parity—and long-tenured employees demand higher compensation to reflect experience.
3. Wage Compression Could Shrink Entry-Level Opportunities
“Higher minimum wages raise the bar for who gets hired.”
Chris warns that higher entry wages could unintentionally reduce opportunities for younger, inexperienced, or less-productive workers, as businesses seek more experienced candidates to justify the cost.
4. Menu Prices Will Rise—But Will Guests Keep Up?
“Higher labor costs mean higher menu prices. Some guests will absorb it; others won’t.”
Operators must walk a fine line between covering rising costs and preserving guest traffic, especially as broader economic pressures (inflation, housing costs) squeeze consumers.
5. Aligning Front and Back of House Through Tipping Creates Stronger Teams
“We created a daily kitchen tipping system—to align the entire team around great guest service.”
At Lazy Dog, kitchen staff receive a share of tips, fostering collaboration between front and back of house and boosting morale. Technology allows for daily tip-outs, ensuring everyone feels the rewards of great service.
6. Tipping Culture Is Evolving—and Facing Pushback
“Tipping has spread across all service industries—but consumer backlash is growing.”
While technology made tipping prompts ubiquitous, Chris notes a growing discomfort among consumers when tipping expectations feel disconnected from actual service provided.
7. Culture Matters More Than Ever for Employee Loyalty
“Compensation is crucial—but culture is what builds loyalty.”
Chris emphasizes that fair pay must be paired with authentic care. Building a workplace where employees feel valued, trusted, and supported is the true key to retaining talent—especially when wage competition heats up.
The future of restaurants isn’t just about better pay or smarter tech—it’s about leading with heart, adapting to economic realities, and creating workplaces where employees and guests alike feel seen, valued, and energized.
Explore more Distinguished Touchpoints