When you look around your favorite store, you can’t believe it’s still open, right? The decline in service, when, how and what people order — the pandemic has meant dramatic shifts for an industry defined by its resilience and adaptability, perhaps changing the dining landscape forever. It is a development that will be lost.
That has changed because we at The Diners have changed. Method is as follows.
Restaurants are still eating 16% fewer people than they were pre-pandemic. But off-site dining is on the rise, according to the National Restaurant Association. But it’s clear how it’s broken down. Shipping is up more than 5% and carryout is down 3. The big winner?Drive-thru, up 13%.
Currently, 39% of all restaurant traffic is stuck in drive-thru lanes, according to National Restaurant Association economist Hudson Riele.
“Operationally, many restaurants are functioning differently than they did three years ago, with greater integration of technology and reliance on off-site markets,” he said.
The restaurant industry has been split in two 2 types of locations: “Hungry”, something that caters to crowds who need to eat right now and those who want to be nurtured and entertained.
“There is a dichotomy in what consumers want. They want value and convenience, but they also crave experience,” says David Henkes, senior analyst at market research firm Technomic. says. “Quick-service restaurants are betting big money that these changes are permanent.”
He cites Taco Bell’s Defy as an example. This is his concept that debuted in a Minneapolis suburb in June with four drive-thru his lanes and a kitchen upstairs. Orders placed via delivery driver-only lanes or through Taco Bell’s mobile app are delivered to customers’ cars via space-age-like tubes about two minutes after order time. There is no cafeteria.
McDonald’s also unveiled a prototype restaurant design for take-out and delivery orders this month in Fort Worth. last year, Fast food chains have added their own delivery services. Delivery is often nearly double the price of buying through the drive-thru, yet customers are still enthusiastic.
It’s a quest for speed and efficiency, something that virtual-only restaurants and kitchens promised at the beginning of the pandemic, and they had a variety of bags to offer. I’ve learned the hard way that the visibility and street credibility associated with is invaluable.
“The eat-in business will be much smaller than it used to be, with more emphasis on take-out orders, and the basis of competition will shift significantly to technology and convenience,” Henkes said.
A restaurant’s digital strategy, accelerated by the pandemic, has become critical. The restaurant industry saw an 18% increase in restaurants offering direct online ordering this year, according to restaurant website company BentoBox. This is despite third-party shipping companies holding their own. While Grubhub’s sales were flat in the first half of the year, DoorDash reported better-than-expected sales in the third quarter.
Delivery app menus and mobile app-based loyalty programs have also been prioritized in this digital dining pivot. McDonald’s, which launched its loyalty program about a year ago, had 25 million members as of Sept. 30 and had used the app in the past 90 days.
“A client was talking on the phone when he was trying to order food and he was annoyed. I said, ‘Why don’t you call me?’ I don’t have to talk to people.” Customers have come to expect digital ordering,” said Tony Smith, co-founder of Restaurant365, a restaurant management system.
But according to software developer TekRevol, developing a basic on-demand food delivery app costs between $30,000 and $50,000. For large corporate restaurants, that cost can be amortized between units or even passed on to franchisees.
For many independent restaurants, this is prohibitively expensive, and they may be locked out of this increasingly essential tool.
“We’re going to see a hollowing out of the restaurant industry,” said Laurie Thomas, executive director of the Golden Gate Restaurant Association, who owns two restaurants in San Francisco.
“We end up with super expensive bespoke opportunities where we’re paying through the nose, and then we’re going to have fast casual restaurants. It’s not really a viable part,” she said.
Independent restaurants may suffer the most, but some restaurant groups that may struggle with cultural change are less focused on ‘experiences and uniqueness’, such as the big name brands roaming suburban malls. Belongs in the category of uninterested, family meals. ”
The last major revolution in the restaurant industry was The Great Recession of 2007-2009. Food trucks proliferated, fine dining chefs shed their crisp white coats and began crafting sophisticated, casual fare, deli sandwiches and diners scrutinizing his food. Fast casual was booming, but demand for Highfalutin’s multi-course his fixer outstripped supply.
Some of the culinary changes, often referred to as the “casualization” of the industry, brought about by these difficult times continue today, but it’s clear that the pandemic has pushed things further.
Regardless of whether the economy heads into recession next year, diners are cautious and very price sensitive. Restaurant transactions fell by about 7% in the third quarter of this year, according to Rabobank research. This is a slightly worse decline than the second quarter, which experts attribute to menu price inflation and consumer pressure.
“We’ve been steadily lowering our forecasts every time we look at the industry, especially actual volume growth,” Henkes said. Top-line numbers look pretty good as restaurants have raised prices, but “underlying it is a softening going into the fall. It’s starting to slow down,” he said.
Consumers feel constrained, but restaurateurs are even more distressed: Government data shows that the price of food consumed at home has risen 12% in the past 12 months, and that more people are staying away from home. At the same time, food consumed in the United States rose by 8.5%. This means that restaurant owners are eating some of that food cost increase and are not passing it on to their customers in order to remain competitive.
One way restaurants are dealing with uncertainty is by scaling back their offerings and streamlining their menus. Focus on foods that have a longer shelf life, higher profit margins, and less effort to prepare. (Restaurant labor costs are up 9.8% this year, and last year he was up 9%. According to the National Restaurant Association.) Menus have become an exercise in brevity during the pandemic and are no longer haiku, but they remain simplified.
Chefs and owners need to reduce their entrees from 10 to, say, 6 and cover the most popular categories such as chicken, beef, salmon, shrimp, and vegetarian, so the range is narrower and more creative. Cooking is getting shorter.
Adding to the culling of choices, says Smith, is the shrinking nest egg of small, independent restaurateurs during the pandemic. not. He anticipates struggles and possible closures of several small international and local cuisine-focused restaurants.
