It’s probably safe to assume people are ready for 2020 to enter the history books. Restaurants are no different. If anything, hospitality could make a solid argument it faced the most disruption from COVID-19 conditions as any sector in America. But that’s not to say January 1 will erase the challenges of the past 10 months. With winter here and coronavirus cases rising, brands are finding themselves reverting to earlier pivots as dining rooms close once again. Yet there is optimism on the horizon as COVID-19 vaccinations gain approval and distribution.
So what trends and changes, born out of the global pandemic, are here to stay? What should restaurants expect amid a shifting landscape where permanent closures and new service models become a tangible part of the discussion?
Here are eight predictions from industry professionals on what to expect in 2021 as restaurants brace for another year unlike any other.
Innovation will be key for restaurant operators in 2021, both in terms of menu offerings and service models. At Torchy’s, first and foremost we continue to be focused on serving our guests Damn Good food, no matter the challenges and changes we’re facing in the “new normal” of COVID. That means continuing to focus on high-quality ingredients and scratch-made food, for example making our tortillas fresh inside the restaurants, squeezing fresh limes for our margaritas and using a range of fresh proteins and produce for our tacos.
We’ll also continue to introduce new innovations that inspire our guests and give them something new to look forward to through our Taco of the Month program. In terms of service, I think it will become even more important than it already was going into the pandemic, to provide guests multiple ways to get their taco fix—how, where and when they want. That means serving up technology that enhances online ordering, curbside and contactless takeout, and flexible footprints that allow for more patio seating, efficient takeout and drive-thrus where it makes sense. Innovation, plus constant, clear communication and transparency with team members and guests will be critical to navigating the fast-moving changes in the restaurant industry.
This year marked Black Bear Diner’s 25th anniversary since first opening our doors in Mt. Shasta, California. This year also highlighted the importance of establishing a genuine culture and building earned loyalty with our teams, a trend we expect to continue for restaurants in 2021. Black Bear Diner is so fortunate to be rooted in a strong founder-led legacy, and we view our job as preserving and perpetuating a genuine culture of caring for our staff, our guests and our communities.
It’s this authentic culture and heartfelt experience steeped in a rich tradition of hospitality that keeps team members with us for the long term, and it’s what keep our guests coming back. What’s more, we believe guests are still seeking that experience even if it needs to move outside of the traditional indoor restaurant setting. In the last year we’ve been able to really focus on growing our off premise business, and we found that guests enjoy our home-style comfort food in the comfort of their own homes. We quickly pivoted to offer Family Meals To Go and have continued to expand our third-party delivery partnerships in key markets, which has contributed to our continued growth, even during one of the most difficult years on record for so many restaurants.
Technology is becoming an increasingly large part of how operators run their businesses and this will continue into 2021 as operators implement the latest technology in an effort to maintain a safe and seamless environment, which is critical given the current climate. For example, technological advancements bartaco has rolled out include contactless ordering at the table, virtual host stands, as well as online team member wellness checks and we expect we’ll see more adoption of these types of services across the board.
We also anticipate continued popularity in takeout and operators looking to expand these offerings. Like many others during this time, off premise has become a sizable segment of our business. In addition to opening ghost kitchens in New Haven and the Westside neighborhood of Atlanta, the demand for dining at home has led us to rolling out offerings including our new Taco Packs, Family Packs, margarita kits, handcrafted cocktails to-go and more. While the dine-in experience will never subside due to people’s desire to eat out and relax, we do believe for the foreseeable future guests will be choosy with where they go out, and brands who are able to provide a safe, yet authentic experience will have an advantage.
Given the increase in distressed real estate due to closures in retail and dine-in sectors, as well as the market opportunity for off-premise, we expect to see accelerated repurposing of retail spaces for ghost and other commercial kitchens. Also, as more options for take-out become available across a variety of markets, we envision increased adoption of digital ordering from baby boomers, who were previously less likely to use the channel or opt for delivery, but have become more comfortable with both over the last year. The pandemic has created off-premise dining habits that will remain well after a return to “normalcy.”
Operators today are managing reduced or restructured teams, while consumer behavior continues to deliver unpredictable trends. However, the financial and operational impact of making inaccurate predictions on sales and labor can make a monumental difference after a single week, day or hour. Forecasting will become crucial as managers look to adjust inventory and staffing plans.
Restaurants will look to adapt their labor models to accommodate shifting consumer preferences and local mandates for takeout and delivery, further complicating the scheduling process for operators who must meet predictive scheduling mandates. We also believe we will see more cities and states adopting paid sick leave and increased minimum wage rates in 2021. On a federal level we’ll also be monitoring the potential for paid family leave bringing additional relief to businesses and their teams.
Consumers are eager to find joy given the challenges of this year, and we believe there is great pent-up demand to return to restaurant dining. Restaurants that continue to innovate and find ways to provide guests value, and a sense of discovery will benefit greatly in 2021.
The pandemic has accelerated consumers’ shift to digital and forced restaurants to rapidly deploy or enhance digital capabilities to recover their sales faster than their competitors. This trend will continue in 2021 as brands fine-tune their digital customer experiences across in-store and online channels, build upon their technology foundation for ordering, delivery, curbside pickup, and double-down on loyalty to grow sales.
We expect more restaurants to invest in loyalty platforms and the ability to deliver seamless user experiences across all consumer touchpoints, both in-store and online. Compared to this time last year, our customers have seen their loyalty program members grow by over 20 million consumers, and loyalty sales grow by nearly 20 percent. This illustrates that the power of combining seamless, digital customer experiences with loyalty and personalization will continue to be a critical growth driver in 2021.
As with major economic, political and social events, the COVID-19 pandemic and its corresponding circumstances and regulations have changed consumer behavior and forced operators to adapt as a result. Restaurant brands have accelerated the deployment of certain technologies and we anticipate these shifts and tech advancements to have residual effects on long-term consumer expectations and restaurant operations.
As we head into 2021, we expect to see the lines between customer experience and digital continue to blur. For example, off-premise has been a major focus for restaurants during the pandemic, and at First Watch, we expedited the rollout of online ordering and third-party delivery in the early stages of the pandemic and introduced a new waitlist management system which is all integrated in our new mobile app. As a result, our off-premises business has grown from 6 to about 32 percent and will remain a key focus area going forward. We expect to see restaurant brands looking to extend the investments they are making and act on the direct connection they can make to the customer.