COVID-19 has had a major impact on the food and beverage industry this year, and foodservice has made headlines having been one of the hardest hit sectors. Restaurants have seen a major shift in business operations, traffic, and income. Restaurants have adapted by amending takeout procedures, elevating the on-premise experience and attempting to create as normal of a pre-COVID environment as possible. Limited capacity has caused menus to be reassessed while distributors struggle to keep up with supply as demand fluctuates.
In September, The National Restaurant Association reported that nearly one in six restaurants nationwide have closed permanently due to the pandemic and an estimated 3 million employees have been left jobless. The industry is estimated to lose approximately $240 billion in sales by the end of 2020. Despite doing a tremendous job at adapting, a tough and uncertain road lies ahead as a new challenge, winter, approaches. The industry will have to implement new procedures to stay afloat and ahead of the competition into 2021.
Cater to the Experience
The first and most important factor to tend to is the on-premise experience. Restaurateurs must create a safe and inviting environment for diners. Customers must feel safe and well-attended to. This includes communicating cleanliness. If not already done so, consider adopting signage for tables expressing they have been cleaned in between parties. Continue to remind and enforce policies for patrons and staff when it comes to wearing face coverings while walking through the restaurant. Dining out is still a worrisome experience for many and has been recently highlighted as a source for Wave 3 infection.
Turn to Technology
Today’s technology can easily replace many of the traditional dining operations, from ordering to paying. If you have not yet adopted a QR code menu, now is the time to. Digital and tap payment methods instead of cash will limit high touch points. Increasing digital interactions was already on the rise, but now, more than ever, these practices are sought after.
Invest in Takeout/Delivery Menu Options
As winter begins to take hold, the key to keeping sales will be utilizing delivery and takeout. Scrutinize menu options to determine which items will make the best presentation and/or are the most desirable on your menu to gain loyal customers and increase order frequency. Packaging, presentation and product quality will be critical in building this business.
Restaurants that have been offering carry-out and delivery have likely gained new customers. It is important to retain these customers and get them to spread awareness that the restaurant is open for business. Establish a loyalty program. Points or incentives for reviews, social shares or visits will go a long way and drive people through the door or to an online ordering platform.
Give Them All You’ve Got
Cold and inclement weather will leave less traffic coming through the door. Coupled with the high rent some establishments face in cities like New York, operating at limited capacity will result in the need to increase check average. Restaurant management will need to get creative when it comes to finding ways to upsell. Whether a bundled deal or convincing patrons to opt for appetizers or desserts, pre-COVID check averages will simply not turn a profit. Tables need to be turned at least one-and-a-half if not twice the rate as they were previously. Consider implementing time limits on tables to ensure as many patrons as possible are seated.
Along with increasing check averages, cutting costs is something to consider heading into the last months of 2020. What aspects of the business can you change? Utilities such as electricity and water are standard costs, but take a look at rent. Is it possible to renegotiate this monthly expense? What about ingredients? Check in on inventory. Can the menu be adapted to include the most popular dishes that share the same ingredients? What is expiring and what do you not need to order more of? Selling more and lowering costs is critical. This is where ghost kitchens play a role.
Ghost kitchens will play a pivotal part in helping establishments recover. Crucial for executing carry-out, ghost kitchens will compliment another establishment’s menu while building your on business and expanding local presence.
Pivoting plans will be difficult, but not impossible. It is important to identify areas of improvement, ask for feedback and incorporate changes to help create a flawless dining experience.
Kathy Holt is a sales and channel lead at JPG Resources, and is an accomplished sales and marketing executive with 30 years of foodservice industry experience, developing teams that are responsive to market activity while focused on sustainable growth.