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Restaurateur says consumer more ‘selfish’ and ‘educated’ than ever

Former Food Network star and restaurateur Willie Degel said Thursday restaurant owners must be more versatile, because the consumer is more selfish and educated than ever before.

The restaurant industry has seen some challenges lately with declines in profits, changing consumer behavior and predicted softer same-store sales and labor-cost increases.

Degel is the CEO of Uncle Jack's Steakhouse. He's also known for his five-season-long reality television show, "Restaurant Stakeout," where he went behind the scenes of different restaurants and helped correct their service problems.

Degel told CNBC's "Power Lunch" that consumer behavior is changing and fast casual restaurants, which often do not offer full table service but use higher quality ingredients, have become trendy.

"It's the whole movement of people," he said. "Everything's changing. Nightclubs are going out of business, people are on their phones … they're electronically engaged. They are more selfish than ever before. You go out, they're not interacting like we did when we were younger."

The restaurateur also said that people are more educated, smarter and eating healthier, noting that more people are heading back to mom-and-pop stores.

"They want to know where their product comes from," he said. "They want to know who the owner is. They want to know it is not this big company. ... They're changing their ways."

Degel said in order for restaurants to survive, they have to become more versatile. One way, he suggests, is by opening up more units. He also said to know who your consumer is.

"You have to have something for everyone," Degel said.

Degel told CNBC that he plans to take his company public in a couple years after he expands to more locations.