Restaurant Industry Faces Challenges Due to Nationwide Penny Shortage

The National Restaurant Association is addressing a nationwide penny shortage affecting restaurant operations. The shortage has created difficulties for restaurant operators who cannot obtain pennies from banks, credit unions, or Federal Reserve coin terminals. This issue is significant for an industry with over $1 trillion in annual sales, where more than 25% of transactions are conducted in cash. The inability to provide exact change can disrupt point-of-sale operations.

In response, the National Restaurant Association is advocating for two primary solutions. The first is urging the U.S. Treasury, the Federal Reserve, and the coin supply chain to collaborate in ensuring the continued circulation of pennies nationwide. The second solution involves federal legislation to establish nationwide rounding rules, providing a safe harbor for restaurant operators when exact change is unavailable.

The Association has communicated these concerns in a letter to the U.S. Treasury and the Federal Reserve, requesting that they take action to maintain the circulation of pennies and prevent negative impacts on restaurant sales. The letter highlights friction at checkout when exact change is not available, which can frustrate customers and potentially lead to lost sales in a competitive industry.

Currently, many restaurant operators are resorting to rounding down transactions when exact change is unavailable. This practice could result in an estimated monthly loss of $13-$14 million for operators, affecting profitability in an industry with narrow pre-tax profit margins of 3-5%.

The Association's letter also calls for the reopening of the penny order and deposit system to facilitate penny recirculation. Additionally, they have requested that Treasury Secretary Scott Bessent issue temporary rounding guidance to offer consistency for restaurant owners and their customers during this period.

Congress is working on legislation to provide long-term solutions, and the Association is actively coordinating with bill sponsors to ensure the industry's priorities are included. If enacted, this legislation would protect small business owners from potential liabilities, simplify transactions, and adapt to a post-penny economy.