We’re looking far down the line here, but it will be interesting to see how this dynamic adjusts once the situation levels out. Will the market-share battle slide back to prior levels? Will customers head to restaurants in droves just to get out of the house?
The NPD Group pegged the dining-out-of home opportunity as an $870 billion slice of the restaurant industry. For perspective, casual dining amounts to roughly $86 billion of that competitive set. The at-home segment accounts for another $750 billion pool, according to NPD.
The National Restaurant Association said recently in its 2020 State of the Industry Report that this year would mark the 11th straight in which sales have risen. By 2030, restaurant sales are projected to reach $1.2 trillion. Also, 44 percent of adults said they want to purchase takeout or delivery more often, and 52 percent said takeout or delivery is essential to how they live, up from 27 percent a decade ago.
It’s probable all of these trends will face disruption short-term thanks to the coronavirus. But just be sure to keep an eye on the day things slow down, too.
Where is the concern?
Datassential said consumers are concerned about contracting coronavirus from an array of food establishments. “And while restaurants and grocery stores are, of course, just one of many perceived ‘high-risk’ environments a typical consumer may encounter in a given day, it’s important to remember this is where their head is at—and provide honest reassurances that their safety is top of mind,” the company said.
- Cruise ships: 71 percent (people who believe visiting that establishment would increase their likelihood to contract coronavirus).
- Arenas/stadiums: 59 percent
- Movie theaters: 50 percent
- Buffet restaurants: 49 percent
- Bars/clubs/loungers: 48 percent
- Cafeterias: 46 percent
- Food courts/food halls: 45 percent
- Hotel restaurants/bars: 39 percent
- Limited-service restaurants: 34 percent
- C-stores: 32 percent
- Grocery stores: 29 percent
- Casual dining: 27 percent
- Grocery deli/bakery: 31 percent
- Fine dining: 21 percent
A number that really jumps out is the buffet. There’s no easy way to address that concern, and it will surely be a significant headwind for chains like Golden Corral and Shoney's moving forward.