May 21

Has COVID-19 Changed the Restaurant Industry Forever?

While the end of the pandemic inches closer, it has forever changed the behaviors and perceptions of restaurant customers. Here's how we can navigate a post-pandemic world.

Change is a strong driver of innovation, and COVID-19 proved to be a mammoth gamechanger. The pandemic reshaped consumer habits and impacted practically every industry in more ways than people had anticipated, the restaurant industry included. It has forced food service establishments to pivot, accelerate the adoption of new technologies and marketing strategies, and grow previously underutilized service sectors.

According to the 2021 State of the Restaurant Industry report by the National Restaurant Association, the industry’s collective sales were $240 billion less than the 2020 forecast before the pandemic. By the end of 2020, over 110,000 food and drink establishments had closed their doors, either temporarily or permanently. This resulted in an estimated eight million jobs lost or furloughed.

While the end of the pandemic inches closer, it has forever changed the behaviors and perceptions of customers, particularly on safety and sanitation, which inevitably flows into dining preferences. Let’s take a look at how COVID-19 has impacted the restaurant industry, and how we can navigate a post-pandemic world.

Rise of Off-Premises Services

The demand for off-premises services skyrocketed as in-store dining, or going out in public generally, was deemed unsafe. Those who previously offered delivery and takeout options had to quickly expand these capabilities. On the other hand, those who didn’t offer those services, particularly table service fine dining establishments, were forced to adapt.

Ordering via online platforms had increased tenfold. Approximately 78% of restaurants now offer some type of online ordering option. 89.6% of restaurants are offering takeout and 81.9% are offering delivery options as of January 2021. A third of those providing delivery options offered it via three or more delivery apps.

Alternatively, curbside service and pick-up are also known to boost service instead of in-store dining.

Impact on On-Site Operations

The pandemic has also had major repercussions on the way restaurants run their daily operations.

Aside from having to embrace off-site services, many full-service restaurants also needed to rethink their packaging for better portability and sanitation. Others redesigned their establishments for outdoor or al-fresco dining which is supposedly safer than dining in an enclosed space.

Restaurants also needed to adopt various technology solutions to cater to the ever-increasing dependence on digital. With the sanitation of physical money put into question, there was a rise in demand for diverse (read: safer) payment options such as contactless payments and mobile wallets. Approximately 40% of food and drink establishments say that they have availed of such tech solutions.

In terms of the menu, many foodservice establishments had to streamline or tweak their offerings to minimize inventory. This includes rethinking menu items to be made by fewer kitchen staff or offering meal bundles, meal kits, or even groceries.

Speaking of fewer kitchen staff, COVID-19’s impact of mass layoffs and downsized businesses has hit the restaurant industry, as it has countless others. Prior to the pandemic, the foodservice and restaurant industry had forecasted approximately 15.6 million jobs – that’s about 10% of payroll employment in the US economy.

But after the pandemic hit, there was an industry shrinkage of two million employees between the ages of 16 to 34, a large chunk of the industry workforce. Furthermore, 62% of fine dining establishments and 54% of fine and casual dining establishments reported having 20% less staff than usual.

Anticipating the Post-Pandemic World

According to Sherri Landry, the CMO of Chuck E. Cheese Entertainment, while many are itching for the in-dining experience, the pandemic has taught many the importance of family time, which may carry over into post-pandemic times and reinforce the importance of delivery and takeout. This sentiment is echoed by Maeve Webster, the president of Menu Matters, who states that the off-premises services will continue being relevant after the pandemic due to the heightened value on sanitation and safety.

So, how can you help your restaurant prepare to meet your customers’ needs in a post-pandemic world?

  1. The increased awareness and value on health and safety is expected to endure even after the pandemic, so continue complying with protocols such as frequent and visible sanitation of the premises. It will also serve you well to have tamper-proof packaging made with antimicrobial materials.
  2. Be ready to accept different types of payment methods. If you’re still operating on a cash-only basis, you are sorely behind on the times and risk alienating those who prefer other ways to pay. Get your system fitted with an all-in-one restaurant POS system that accepts various types of payment methods – cash, contactless, checks, and mobile wallets. A POS system can also help you with remote inventory management, remote staff management, and customer engagement, so it’s a good long-term investment in a digital-first world.
  3. Engage with both potential and existing customers digitally. Under normal circumstances, you’d win customers over through a wonderful in-store dining experience. But now, more than just giving them a place to view the menu and input their orders, you need to use social media to build your brand and foster relationships. Table-service establishments are usually more inclined to have official websites, but fast-service establishments tend to be more active on social media networks.
  4. Optimize your business operations. If your restaurant is a huge, enclosed space, you may want to consider getting a place that allows for more al-fresco diners. Depending on the preference of your consumer base, you may also consider ditching the physical restaurant altogether with a ghost kitchen that exclusively caters to takeout and delivery.

Ready to take your restaurant into the next evolution? Contact True POS today and ask for a free quote.

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