According to industry tracker Black Box Intelligence, restaurant comp sales declined 10.3 percent in November—the worst result since August, or a 3.8 percentage point drop from October. Traffic fell 16.3 percent.

This report isn’t startling. It’s like getting a test back when you guessed on all the answers. Just Wednesday, the U.S. hit a record high COVID-19 hospitalization rate, with more than 100,000 Americans checked in. Johns Hopkins University reported 2,804 new deaths, which eclipsed the previous April 15 peak of 2,607. In early November, the number of hospitalizations reached mid-April and July highs of about 59,000, and have climbed since. Wednesday’s figure of 100,226 hints at a troubling winter ahead.

Black Box Intelligence said November’s results fuel fears of another downturn as cases climb throughout the country and colder weather translates into less opportunities for outdoor dining. Every week in November reported worse same-store sales than during any of the preceding eight weeks going back to the beginning of September. The traffic performance was the lowest since the second week in August.

Additionally, although change in average spending per guest, year-over-year, continues to track far above pre-COVID levels (thanks to larger orders and fewer solo occasions, especially around breakfast), the last two weeks witnessed a deceleration. In fact, it hasn’t been this low since early July.

Year-over-year growth in off-premises sales dropped for limited- and quick-service chains. “This creates concern that consumers may be becoming more cautious and shifting some of their food spend away from restaurants as they did at the beginning of the pandemic,” Black Box said. In other terms, hoarding behavior could be on the horizon once again.

President-elect Joe Biden on Wednesday held an economic roundtable where he addressed the challenge for restaurants, saying, “It should not be a loan, it should be a guarantee,” of potential federal aid.

“You should be able to get that money to be able to stay open because it affects the ability of the economy to continue to grow … Putting this money into the economy generates economic growth. It’s not just you have a debt—you do—but it generates so much growth,” he said. “When your restaurant employees are able to go out and buy a used car or go out and make sure they can get their first apartment, make sure they can get out and purchase new clothing, it all relates to everybody else does better.”

TRENDS TO LIVE BY IN 2021 AND BEYOND

The most recent stimulus proposal—a $908 billion package—left out direct aid for restaurants. While there is another round of PPP loans in the outline (much could change, if the stimulus even passes), the Independent Restaurant Coalition didn’t appear optimistic. “The Paycheck Protection Program didn’t work for restaurants in March and it won’t work now,” the organization said. An August report from the U.S. Small Business Administration showed the “Accommodation and Food Services” sector received just 8.1 percent of PPP dollars. This as restaurants and bars contributed to nearly a quarter of all jobs lost during COVID—more than any other industry.

Since the initial program, one in six restaurants have closed, according to the National Restaurant Association, and 2.3 million people are off payroll. In just Q2, restaurants lost $220 billion in revenue.

Restaurants continue to push for the $120 billion RESTAURANTS Act in response. “[It] would allow us a bridge to a post-vaccine world where we could get our staffs back to work, to galvanize the Wisconsin tourism industry, to encourage travelers to eat in Wisconsin’s establishments, visit our tourists attractions, go to our retail shops, and take in a show at one of our local independent concert venues which, selfishly, I miss the most,” Dan Jacobs, owner of DanDan and EsterEv in Wisconsin, said in a statement.

Jacobs added winter, plus an “exploding COVID positive rate,” has formed a “perfect storm of loss of revenue for businesses and then on top of that, the loss of jobs for the American workforce that were propped up by those PPP loans”. 

Here’s a look at markets stepping up restrictions in recent days.

All of these challenges have stirred a purgatory state for restaurants. So as operators approach 2021, taking the pulse, or the “state of the industry” view, is a complicated task. In some ways, it feels like the beginning all over again.

But, in reality, that’s not quite the case. Restaurants are armed with far more data this time to navigate what lies ahead, as bleak as it might seem. But will it be enough after months of depressed revenue is the question facing thousands of operators.

Upserve assessed trends from its 10,000-plus restaurant base to examine what worked this past year and what could get restaurants through the coming gauntlet.

As it often does, the road back begins with food.

Menu trends changed dramatically in 2020 versus 2019 thanks to a rise in online ordering. From fine dining to quick service, customers sought simple and comforting options. Restaurants rushed to meet those demands while also trying to balance cost and labor, simplifying menus for better off-premises execution, and adapting items so they could travel.

Increased appearance on menus in 2020

• Sandwiches and wraps: 21 percent
• Burgers: 10 percent
• Pizza: 9 percent
• Salad: 7 percent
• Seafood: 6 percent
• Pasta: 5 percent
• Fried chicken: 5 percent
• Desserts: 5 percent
• Bread: 4 percent
• Barbecue: 2 percent

When it came to dine-in menu trends, Upserve saw plenty of overlap with online ordering. But it also observed a guest who wanted to experience certain comfort foods at a restaurant more than at home, particularly ones best eaten fresh from the kitchen, like seafood, steaks, and roasts.

Increase appearance on menus in 2020 (dine-in)

• Seafood: 17 percent
• Sandwiches and wraps: 14 percent
• Steak: 8 percent
• Salad: 7 percent
• Pasta: 6 percent
• Burgers: 6 percent
• Fried Chicken: 5 percent
• Desserts: 4 percent
• Barbecue: 3 percent
• Roasts: 3 percent

Upserve also broke down the highest-selling items by restaurant type to see how they stacked against the overall average. This encompasses in-house and to-go orders, and is in order.

Bars

• Beer
• Bottles of wine
• Cocktails

Fast casual

• Tacos, quesadillas, and empanadas
• Coffee
• Chicken sandwiches

Casual

• Sandwiches and wraps
• Burgers
• Fried chicken

Upscale

• Sandwiches and wraps
• Seafood
• Salad

Fine dining

• Salad
• Steak
• Seafood

The effect off-premises (thanks to COVID restrictions) is having on menu trends remains glaring. This likely won’t endure indefinitely when things return to some semblance of normal, dine-in wise, but it does present a roadmap for the coming months. Can a fine-dining spot turn one of its classic dishes into a salad? Can an upscale chain do the same with a sandwich? If there wasn’t a clear menu distinction between dine-in and off-premises before, this could be a good time to prepare for further lockdowns.

Each year, Upserve looks at trending items from James Beard Award-winning restaurants, too, and compares it to the database. Generally, what emerges is new and exciting flavors, concepts, and ingredients that appear a step ahead of the trend pack. In 2020, however, even the most high-end and acclaimed spots turned to simple and satisfying choices.

Family style meals were the top-selling items at JBF restaurants this past year. Fish, chicken, salads, and veggie-based options were the most popular types of meals sold, either family style or otherwise. One reason could be the spike in beef prices seen throughout much of 2020.

Alcohol sales moved toward bottles of wine and cocktails, which as Upserve pointed out, is expected as many of these venues are special occasion destinations and tout menus often accompanied by beverage pairings. So if you’re going to dine out, you might as well buy the whole bottle.

Tickets that featured “tasting menu” as an item made the top 10 as well. This tells us that while simple comfort food is the top trend for 2020, many people are still looking for a special experience, Upserve said.

On to the sales

In Upserve’s base, brands that adopted an integrated online ordering platform, diversified their revenue streams, and relied on hard data to continue adapting consumer demands, fared better than others.

Generally, though, upscale restaurants and bars absorbed the biggest hit, as we know by now. They simply weren’t as equipped to deliver food without a 360-degree customer experience proposition, which made the pricing structure of off-premises difficult. Not to mention trying to get food never designed to travel to, well, travel. And what that did to the presentation, quality, and perception along the way. Bars, naturally, are socially driven gathering venues trying to survive in a time of crowd avoidance.

Here’s a look at market breakdowns comparing March–October 2020 sales to the prior year.

West

• San Diego: –50 percent
• Denver: –51 percent
• LA: –55 percent
• Las Vegas: –57 percent
• Portland, Oregon: –62 percent
• Seattle: –65 percent
• San Francisco: –71 percent

South

• Miami: –51 percent
• Atlanta: –54 percent
• Houston: –55 percent
• Nashville: –58 percent
• Austin, Texas: –60 percent
• New Orleans: –72 percent

Midwest

• Chicago: –49 percent
• Detroit: –61 percent
• Minneapolis: –63 percent

Northeast

• Providence, Rhode Island: –56 percent
• New York City: –65 percent
• Washington, D.C. –67 percent
• Philadelphia: –69 percent
• Boston: –70 percent

Lean on holidays

The pandemic hasn’t really slowed the holiday rush. Mother’s Day and Cinco de May still reported sales spikes of 306 percent both in-house and for online hoarders. However, since people are coming to restaurants less, Upserve did witness an above-average drop in sales in the 48 hours following each holiday.

There’s a smaller window to capture holiday guests than before. People break quarantine rank, but not for long.

Upserve identified two types of holidays where people proved most likely to dine-in at or order from restaurants—those that are celebrated on the actual holiday and those that are celebrated on an observed day (usually the day before).

What are the “day-of-holidays” to watch? Mother’s Day, Thanksgiving, and New Year’s Eve. Obviously only one remains but it speaks to the future opportunity. Guests want to celebrate these holidays on the actual day, Upserve said. So ramp up staffing accordingly.

“Observed holidays” generally land on a Monday, like Memorial Day or Labor Day. Since many people enjoy a three-day weekend for these and have to return to work Tuesday, these are more likely to be celebrated on the Sunday before.

“Outliers” comprise holidays less predictable since they land on a different day of the week every year. The 4th of July, for instance. It tends to be a notoriously slow restaurant day thanks to backyard cookouts. In 2020, it fell on a Saturday and Upserve saw an increase in restaurant sales on the Friday before, a day many people had off as an “observed day.” Then, sales dipped on the actually holiday.

The company offered three tips to plan ahead of holidays—something critical when spontaneous foot traffic remains fleeting in a COVID world.

Ramp up your marketing efforts

Come up with a special or promotion for each holiday and begin marketing it early to your followers on social media and to your email subscribers. You won’t be able to avoid the 48-hour post-holiday drop off, but you can try to make up some of that lost revenue by selling as much as possible on the holiday.

Schedule enough staff on holidays

With increased marketing efforts, you’ll be bringing in returning guests and new customers alike. Make sure their experience is memorable and up to your standards by having an adequate number of employees scheduled and they will keep coming back.

Reduce staff following a holiday.

Prepare for the 48-hour dip by cutting back to a smaller staff on the two days following each holiday (or give yourself a break and close up for a day or two if you feel it’s a viable option). Also keep this two-day lull in mind when ordering inventory for the week.

What’s working, and what to do

Upserve gathered some success stories and came away with a blueprint.

The first point was online ordering. Those who added the option to operations early on saw less of a drop in sales than those who waited. But looking ahead, it’s something that won’t get shut off by future case waves, winter weather, or official mandates.

“At the beginning, we spent all of our time perfecting our to-go and delivery so that later on this year, if there’s another shutdown, we pull back then slip right into what we were doing before,” Antonio Gudino of Go Fish Sushi told Upserve. His point is clear and simple: have multiple options to rely in.

Next was to invest in marketing and have a clear strategy to lure new customers. Keeping an open and honest line of communication with guests via email, social media, and in person is critical during this time of frequent and unforeseen changes, the company said.

As Neyah White from The Retriever shared, “We built up business by radically changing our offering every week. Really giving the kitchen a workout and keeping our clientele engaged on social media. That yielded huge engagement on our social media, because that’s how we announced everything. Plus, it allowed us to expand our alcohol sales.”

Simplifying or adjusting menus for takeout and delivery was another point. You see this everywhere from local shops to Outback. If you’re going to satisfy lifted off-premises volumes, getting it right becomes critical and a direct tie to whether or not a new customer comes in for dine-in later. Plus, many restaurants are working with tighter staffs, and less margin for error on the P&L, including monitoring food waste. So removing complexity is more than just a buzzword.

The last one was diversifying revenue streams. Like online ordering, restaurants realized they couldn’t keep all of their survival eggs in one basket. Some started serving new types of fare, hosted events, and found new retail options to bolster the bottom line and reach new guests.

Amanda Sullivan, from Canlis, captured the chaos. “What do we have to offer? And what’s safe? We started with burgers. We then did bagels in the morning. Family meal delivery. Then we had the CSA boxes, the drive-in, and the crab shack. It’s been just really cool to see everyone extending the meaning of hospitality in a really difficult time.”

“The 2020 trends in menu items, the way people choose to support restaurants, and the way in which restaurants are run are going to carry into 2021 and, for some, become a permanent fixture in the ways our industry does business,” added Upserve.

And on that note, here are some 2021 hospitality trends to monitor, courtesy of Upserve.

Hospitality is still king

From in-house to to-go, fast casual to fine dining, the key to guest retention is treating every single customer as if they are your top priority. If you can’t speak with them face-to-face, use social media, email, and reach out to online reviewers.

Always keep adapting

Restaurant owners have always been nimble and quick-thinking, but now more than ever it’s important to have better data at your fingertips to make quick decisions and to know when to abandon a strategy that no longer makes sense.

Online ordering is here to stay

It was already on a meteoric rise, but the pandemic has increased guest’s reliability on the feature. It is no longer a nice add-on, but a must-have feature. Restaurants need to be able to strike a balance between using third party sites and native online ordering to hold on to as much revenue as possible while attracting new guests.

Simplify and adapt menus

Family-style meals, comfort foods, and items that travel well for takeout and delivery are going to continue to be best-sellers as dining rooms are closed or working at reduced capacity.

Look outside the box for new opportunities

Diversifying revenue is the name of the game for 2020 and beyond. We saw wine bars start selling breakfast sandwiches and coffee and a famous fine-dining establishment turn itself into a drive-in movie theater. Shifting focus to anything that will make money and retain guest attention is key to surviving the pandemic.