In light of the Coronavirus pandemic, restaurants across the United States are switching to curbside pickup and contactless delivery options to keep business running and customers happy and well-fed!
But how sustainable is it for businesses in the food industry to adapt to the challenges brought on by COVID-19? Is it possible that some of these changes are taking a toll on your businesses, and might impact the future of the entire industry? While we can’t predict the future, one thing’s for sure: the restaurant industry is going to change for good.
Here are our predictions for how COVID-19 will remodel the restaurant industry once the pandemic comes to its end:
1. Local Businesses Will Continue to Struggle
Some of our favorite restaurants have existed for decades, filling our bellies with delicious family recipes passed down from generation to generation – but now the virus threatens permanent damage to their legacies.
Fine dining restaurants may be able to withstand the blow of no dine-ins as they rely on fat cash reserves. However, 70% of all U.S. restaurants are single-unit operations, and these local and independent eateries may not be able to survive the stress.
One hundred fifty restaurant operators from the 5,000 surveyed by the National Restaurant Association said they’d shut down business for good, and another 11% said they expected to close down eventually. It’s more crucial now to support your local businesses – so they can keep rocking your taste buds once this all ends.
2. A New Meaning for Restaurants
With the industry evolving as quickly as it is, it may be time to get your yoga mat out and dive into some deep meditation on what it means to run a restaurant in a post-coronavirus world. Customers are increasingly demanding more convenient options – meal kits and packaged foods will likely take the forefront in the future, encouraging restaurants to focus on the simplicity of their meals.
Will dine-in restaurants have the same appeal in a time where health-conscious customers simply plan on avoiding the buzz of a packed venue? Who knew we’d see days like these? We certainly didn’t. But there’s more to come.
3. It May Be Harder For Them To Welcome You Back
For restaurants operating at limited capacity and those not operating at all, reopening after the lockdown, at full capacity, is a challenge you should expect and prepare for.
While the Stimulus Package may help keep most of us afloat right now, focus on saving reserves for the future where you’ll need power up your eatery to ensure that the customers get everything. Restaurant owners still need to pay rent, suppliers, and staff. These funds will require replenishing at the same rate they were before you shut down.
4. A Revamped Dining Landscape
For restaurants that do manage to reopen – the experience just won’t be the same.
Let’s face it: diners are more reluctant to step out, obsessively Purell-ing the life out of everything they touch. We don’t blame them. Which is why we think delivery and takeout will play a bigger role in the future.
U.S. restaurants may also have to lower prices to attract people who are already tired of the loss of income caused by the pandemic. According to research by Datassential, 22% of people surveyed say they’ll lean towards affordable restaurants once the U.S. jumps into COVID-19 recovery mode.
Moreover, around 18% of people said they’d turn to ‘dollar’ and ‘shared’ menu items in order to spend fewer bucks when buying meals for the family. This is especially important for fine dining restaurants that will be easier to resist for people as a result of the increased financial strain.
5. Filling The Gaps
COVID-19 is exposing several shortcomings in the restaurant industry:
Line cooks, dishwashers, and hosts are paid by the hour and may not have benefits like paid leave and healthcare in their terms of employment, unlike servers and bartenders – who also earn tips.
While most restaurants can’t rely on cash reserves (much like their employees) in the long run, restaurants will need to take better care of their employees. Ensuring healthcare and basic income may be a coronavirus-inspired change once this is over, as it showed owners the dangers posed to their workers on the daily, and the need to keep them safe and secure – even if higher costs.
6. Mobile Ordering To Escalate
Smartphone and mobile orders were already predicted to become a $38 billion industry by 2020 – and the coronavirus has only accelerated the pace.
That being said, with third-party delivery platforms like Uber Eats and DoorDash refusing to lower commissions (which can go up to a whopping 30%), restaurants are increasingly looking into starting in-house delivery services. In a heartfelt message to Starbuck’s partners, CEO Kevin Johnson talks about how they’ll stick to drive-thru and contactless delivery only, despite having self-service options for customers.
Like our buddies at Starbuck’s, we definitely think these options are coronavirus-friendly and will keep your eateries running for as long as they can. Work towards an independent system — If you’re still using these third-party delivery platforms, consider switching to self-delivery in the long run.
7. Cashless Payment Options Are Here To Stay
Cashless payments, once born out of convenience, are now a necessity – and this could be a long-run change. Around 80% of all payments in the U.S. last year were through payment apps and credit cards.
They’re safe, reliable, and reduce the need for contact, exchanging cash, and you don’t even have to leave your house! Update your payment options to accommodate this service, it’s a booming business, and it’s likely to stick around.
Suffice to say; the restaurant industry hasn’t come across anything like this before.
World Health Organization (WHO) isn’t planning to ease the lockdown directives for the foreseeable future, especially with the U.S. taking the forefront as the epicenter of the global pandemic. U.S. restaurant owners should prepare to change operations permanently – at least in the near future.
Moving forward, we must assess ways to ensure our businesses survive right now and redirect our energies to nourishing and protecting our communities for the longterm.
Interested in learning more about Lunchbox?
See how Lunchbox can transform your restaurant’s digital ordering
into a powerful omnichannel system.