How tech & big business co-opted "local"
Maybe a local restaurant is just the restaurant nearest you
A new law in California that was meant to improve working conditions for fast food workers in the state won’t be implemented this January as scheduled. Instead, the bill’s opponents succeeded in collecting over a million signatures in an effort to force a vote on the idea — next November. (The signatures are still under review, but a Sacramento judge put a last-minute hold on the law’s implementation late last week.)
The coalition that seems to have successfully blocked efforts for government intervention in big restaurant operations calls itself Save Local Restaurants. It’s an interesting moniker for a group backed by tens of millions of dollars from restaurants like Chipotle and In-N-Out and industry lobbying groups like the International Franchise Association, the National Restaurant Association, and the U.S. Chamber of Commerce.
Their argument: exerting government control over things like wages in the fast food industry will make it incredibly expensive for large restaurant groups to operate in the state. Food will become more expensive. Restaurants will have to close. We’ve heard this before.
Save Local Restaurants wasn’t named by accident. The idea of a local restaurant evokes warm fuzzies; the pandemic and all of its associated hardships only reinforced this. In the span of about three years, local businesses have been used to pull at our heartstrings, then as marketing tools for large tech companies, and now to convince us that any sort of official oversight doesn’t belong in addressing worker treatment and quality of life issues — even when the group fighting the change isn’t exactly local.
It was early in the pandemic when “local restaurants” earned fast public support as restrictions forced closures. A group called the Independent Restaurant Coalition (IRC) spun up quickly in the spring of 2020 to represent independent restaurants’ interests during the pandemic. It was led by several top-name chefs, including Tom Colicchio, who served as the IRC’s de-facto spokesperson and public face in those early days. The group successfully lobbied for independent restaurant-specific policies, including the Paycheck Protection Program (PPP) for small businesses, and then the Restaurant Revitalization Fund, $28.6 billion earmarked for independent operators. Those programs, we now know, were imperfect but also not big enough; plenty of local restaurants went without relief, many closed, some were strung along in a series of heartbreaks. Last-ditch efforts to secure more cash from Congress failed. For better or worse, we moved on. (As did many of the IRC founders, it seems, including Colicchio.)
But the idea of “local restaurants,” those businesses that somehow needed our help, your help, to survive, persisted. Meanwhile, pandemic conditions conditioned lots of us to the idea of digital ordering and delivery, from restaurants to grocery stores to everything in between. With increased interest came increased scrutiny: Cities stepped in to regulate food delivery, slapping restrictions on business practices they previously ignored, food delivery companies fought back, laws and regulations were tempered and the rules of doing business settled into that “new normal” I can’t stop talking about.
It’s still playing out. Last week, Grubhub agreed to pay $2.7 million to residents in Washington, D.C. — plus an $800,000 civil penalty, for a total of $3.5 million — to settle a lawsuit alleging that the company charged customers hidden fees and used deceptive marketing tactics. “Grubhub used every trick in the book to manipulate customers into paying far more than they owed, and even worse, they did so at the height of a global pandemic when District residents were already struggling to make ends meet,” the city’s attorney general said in a statement. Grubhub denies wrongdoing.
A few weeks ago, Uber settled with Chicago over its own alleged “deceptive practices,” paying a total of $10 million to settle claims that restaurants were listed without permission and consumers were misled over potential free delivery, among other grievances. Similar lawsuits against Grubhub and DoorDash are pending in the city.
All of these settlements and lawsuits and regulations and changes are meant to protect both restaurants and customers. They’re sold to the public as a way to stick it to big tech while protecting local restaurants. And who doesn’t love a choice opportunity to hit big tech… right? These settlements, sanctioning behavior from years ago, read like the final chapter of the restaurant-good, delivery-bad narrative. (If only it was that simple.)
On a recent episode of New Food Order, a podcast by industry pros I seriously respect, guest Errol Schweizer, a former VP at Whole Foods with over 25 years of industry experience, put forth a contentious new idea: What if food delivery was a public utility?
Podcast hosts Danielle Gould (of Food+Tech Connect) and Louisa Burwood-Taylor (of AgFunder) said they took days to formulate thoughts on the proposal; Gould, an admitted optimist excited about moonshot ideas felt it was worth exploring for its disruptive potential; Burwood-Taylor brought a pragmatic counter-argument noting that few public resources are run with the sort of efficiency and effectiveness that food delivery requires.
The idea was discussed as part of a big-picture view of food systems well beyond restaurants, but current delivery structures factored heavily. Schweizer cited venture capital-backed companies that operate at a loss as a signal that the technology powering how food moves around cities and suburbs and even rural locations isn’t working. Technology companies that are propped up by hopeful investment dollars keep inserting themselves between restaurant and diner, sometimes improperly. Then, cities settle with big tech in the name of saving local restaurants and, perhaps more marketable in this economy, protecting consumers’ wallets.
That’s probably why California’s Save Local Restaurants was stunningly effective in its swift counter to a law meant to transform the fast food industry, which plenty of people would consider the antithesis of a local restaurant. In early December, Fast Company reported on some potentially troublesome signature collection efforts — one video captured shows a signature gatherer positioning the petition as a way to “raise fast food workers’ pay.” Even the piece’s headline gives away the plot, describing “how easy it is to hijack California’s referendum process. Big Tobacco, Big Tech, and Big Oil have all taken advantage of it — that is: they spend tons of money to gather signatures and challenge laws deemed unfavorable to their industry. (If you’re thinking about California’s Proposition 22, backed by hundreds of millions from big delivery companies, you’re not wrong!)
It’s been interesting, and a little bit sad, to watch local businesses used as pawns to help big business achieve its goals, from marketing campaigns to political intervention.
In a December press call (as reported by Fast Company), Mary Kay Henry, president of the Service Employees International Union and a supporter of the original California law, denounced the corporate interests working against it. “Rather than invest these resources into paying living wages and supporting their franchisees, these conglomerates are instead burning money to subvert our laws and attack our democratic process,” she said.
Bowls as lifestyle: 2023 edition. Remember when the person in charge of the salad chain basically said salads would fix Covid? Sweetgreen CEO Jonathan Neman was (rightfully) criticized for drawing the parallel between his business and fending off a highly contagious disease; the entire thing had big 2021 energy. The wellness-as-marketing-in-a-pandemic trend is still with us, though. In 2023, that looks like Chipotle’s latest moves: In an effort to reach Gen Z and millennial customers and capitalize on the “new year, new me” mindset, the chain is launching a Snapchat Lens that will include meditation prompts and exercises. Chipotle will reward 100,000 lens users with … you guessed it, free guac. It is also debuting a line of digital-menu only lifestyle bowls. In its own January marketing, Sweetgreen has partnered with the influencer-founder of a “wellness & lifestyle platform dedicated to mindful movement and inspiring healthy habits.”
The search appears to be on for a new head of restaurants at Square. Exec Bryan Solar left the company last year to head up product at SpotOn, another software and payments company. The posting for his old gig asks for extensive industry experience before sharing a compensation range in the mid-high $300,000s. Get on it! (Or… call me?)
Speaking of exits, Tock co-founder Nick Kokonas has stepped down. His last day was January 1. “It has been a true adventure to have an idea, push it into existence, and then nurture it for a decade,” he wrote on Twitter. (Also, if you, like me, enjoy Kokonas’s light-match-walk-away approach to stirring up controversy, fear not, I expect the opinions to proliferate.)
A great oral history on the incredibly fast rise and equally fast fall of 15-minute grocery delivery in 2022. Modern Retail nails it.
Big juicy issue, thank you.