When they say “cash only” everyone seems to understand it means “we dodge our taxes”. But the food is usually pretty cheap. I’d say they probably won’t evolve unless they start getting prosecuted for tax avoidance...
I totally understand the undercurrent of the 'cash only' operators - but I think that there will always be a portion of your customers who will use cash (travelling tourists etc.) as well as a large chunk who will want to use some form of electronic payment.
Far better for a business IMO to offer both - then they can still pocket most of the cash transactions without declaring, yet still show legitimacy to the ATO by having electronic payment records, which should keep the auditors at bay.
Our town is popular for market and pop up stalls all over the place, and while these used to be cash only for nearly as long as I have lived here, I have been noticing that a lot of them now have portable EFTPOS machines, or smartphones connected to Square or other payment swipers. Especially those that sell clothing or items >$20 because locals just don't seem to carry large notes around any more on a casual basis.
Or more people no longer want to pay in cash so their sales go down dramatically.
Avoiding tax on no or low income is a lot worse than paying tax on larger profits via electronic payments.