How Restaurants Can Manage, Adapt, and Thrive Through COVID

How Restaurants Can Manage, Adapt, and Thrive Through COVID

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COVID-19 has impacted businesses globally, reducing incomes and forcing long-running companies to shut their doors permanently. 

The pandemic has especially impacted is the restaurant business. 

The inability to serve a regular range of customers in-house has taken a massive toll on earnings, with restaurant sales reports estimating a loss of $240 billion USD in 2020 and others projecting permanent closures.

COVID-19 and the Restaurant Industry

It's no secret that the coronavirus had a widespread impact on restaurants well before the vaccine was ready. 

Since the US first went into lockdown in March 2020, dining establishments have been forced to close their doors to the public in response to the global pandemic. 

Although many restaurants have successfully reopened since then, a staggering number of them never made it out of the pandemic alive. In some parts of the country, such as New York City, indoor dining remains closed, causing restaurant owners to lose a large chunk of their revenue.

However, if there was one good thing that came out of this stressful time, it was the innovative solutions that restaurant owners came up with–albeit in an effort just to survive. 

Many dining establishments upgraded their delivery services to accommodate customers who didn't feel safe eating indoors. Similarly, online ordering became a priority for many restaurants as a growing body of consumers began to rely on these services.

Another unprecedented trend that emerged as a result of COVID is ghost kitchens. 

A ghost kitchen is a creative concept that grants restaurants a greater sense of freedom and versatility. Essentially, ghost kitchens operate from an independent kitchen area and lack an official storefront. Patrons then place orders through food delivery services or the restaurant's website, and chefs prepare the food from within the isolated kitchen.

It's Not About the Food

Oddly enough, the European Food Safety Authority confirmed that food is not a transmission route for COVID-19. The fear about going to a restaurant seems to be about gathering people, not the food. 

Indeed, the CDC has suggested that events for 50 people or more across the United States should be cancelled or postponed. At the time of writing this, countries and counties are starting to close all hospitality venues. While it specifically says that this does not apply to businesses, some states, such as Ohio, significantly reduce the number of people allowed in certain institutions, including bars and clubs, to improve social distance. 

In places like San Francisco, Toronto, Spain or Italy, restaurants have been closed by the local/national governments. The only option? Online ordering. 

Despite this, it's not clear whether take-out orders and delivery are increasing. Some anecdotal evidence suggests that they are. But with supermarket shelves becoming emptier and people getting bored of all the pasta they've now hoarded, it seems likely that many people will want to order delivery just for the sake of variety.

And in countries where going out is currently almost completely banned, small social gatherings seem to be gaining popularity. These people need food, and takeout is a good way to enjoy celebrations with something a little different.

Some data supports this, with one of the earlier studies stating that 13% of people say they will order more often if they are forced to stay inside.

What Does COVID-19 Mean for the Gig Economy?

In China, there was an 80% increase in online ordering.

Some Starbucks in the United States moved completely to online ordering.

Meanwhile, Chipotle is offering free delivery, and its food comes in tamper-proof boxes for security.

To help spur online delivery, Grubhub is offering to cancel certain fees for independent small businesses in certain areas (although it's not quite clear what qualifies as an independent small business). 

Other delivery apps may follow, and some seem to be getting together to create a mutual fund to help workers. 

In a segment of the industry that traditionally fights like cats in a sack to keep its workers as external freelancers, that's a huge step.

In short, despite the challenges of the pandemic, there have been some silver linings for the gig economy and restaurant industry. 

Unless you’re KFC in the UK… who was actually forced to change its slogan. Apparently, "finger-lickin' good" is a bad thing when it comes to COVID-19 transmission. 

restaurants-covid-kfc

How Will the Vaccine Impact Restaurants?

Even as an increasing number of people get their COVID shot, the world still looks very similar to the way it looked a year ago. This leaves many struggling restaurant owners to wonder how the vaccine will affect the restaurant industry going forward.

One of the biggest challenges restaurants will have to face is deciding whether to make the vaccine mandatory for their workers. While some believe that requiring proof of vaccination is an effective way to ensure optimal health and safety, others feel that this is a violation of workers' medical rights. Some employees have also cited religious reasons for refusing the vaccine, which raises new obstacles for employers who aim to vaccinate their entire workforce.

With major decisions regarding vaccination left up to restaurant owners, the future of the restaurant industry is still hazy. In the meantime, though, it's still imperative for workers and employees alike to take the proper precautions to stay safe from the virus.

How Restaurants Can Cope

The most important steps to take are precautions that have been in place since the start of the pandemic. Restaurants that currently offer indoor dining should make sure that their workers are wearing masks at all times, especially when interacting with patrons. Diners should also be required to don a mask when they're not eating to curb the spread of the virus.

Frequent handwashing and sanitizing should also be in place. Not only can these safety protocols help keep businesses safe, but they also reassure customers that the restaurant is a trusted place to eat at.

Ghost kitchens and online ordering show no signs of disappearing yet. In addition to protecting customers from COVID-19, these trends serve as effective alternatives to in-person dining while things start to return to normal.‍

Trends That Will Continue After the Pandemic

Some businesses in the food and beverage industry have adapted to the restrictions brought on by the pandemic, learning to depend on new ways to turn a profit. Even when COVID-19 restrictions are eventually lifted, the pandemic has forever shaped the way the industry will function. Here's what restaurants can expect once we approach the end of the pandemic.

1. Limited Seating

In the US, most restaurants are in the re-opening phase

This involves limited seating, with some restaurants restricting their seating to outdoors only. 

Many businesses have invested in outdoor heating lamps or igloo-like structures to accommodate the cold weather, and most restaurants require customers to wear masks when they're not seated or eating. Servers need to wear masks at all times and sanitize hands whenever possible.

As covid restrictions begin to be lifted, restaurants can expect a gradual increase in the amount of seating they can permit. However, it is unlikely that full seating will be allowed for a long period of time. Moreover, smaller restaurants or businesses that lack outdoor space are at a disadvantage because it is harder for them to meet social distancing requirements. Finally, many customers may be hesitant to eat in restaurants that do not offer a wide range of space.

2. Online Ordering

One of the main ways restaurants have adjusted to accommodate the limitations of COVID-19 is by relying more heavily on online ordering. At the beginning of 2020, online sales reports saw a 169% increase in the number of restaurants that used food delivery tools. For many restaurants, takeout services have helped them stay afloat; restaurant analytics report an upward trend in food services relying on takeout and delivery, sometimes for the majority of their income.

For ghost kitchens or virtual kitchens that operate without the standard seating of a restaurant, delivery is par for the course. 

However, some traditional restaurants have had trouble transitioning to delivery. The main use with online ordering are costs and technological difficulties.

3. Costs

Prior to the pandemic, many businesses rejected the notion of delivery services because of the costs associated with online ordering tools; for example, restaurants that partner with UberEats reportedly pay a hefty sum of 15-30% just to use the platform. 

These costs cover a variety of services, including:

  • Payment processing
  • Customer support
  • Marketing

For many restaurants, these costs were enough to rule out the idea of third-party delivery altogether. Some businesses have managed to create their own delivery systems, while others chose to rely solely on in-person dining and pick-up orders. However, the pandemic has made it virtually impossible for a restaurant to stay open without delivery. Even restaurants with their own delivery people and cars rely on third-party apps because it helps them reach a wider audience.

While many of these apps lowered or even eliminated their fees to help the industry, there's still the issue of technological difficulties.

4. Technology

For restaurants that are new to delivery apps, it can be difficult to learn how to process those orders. It requires knowledge on how the app functions; businesses that are used to conducting all of their transactions in-person or over the phone struggle with managing a new platform.

It becomes especially difficult when a restaurant partners with multiple online ordering tools. Each service provides a tablet for the restaurant to accept and process orders through, and not knowing how to efficiently check and use each one can result in missed and lost orders.

Due to the limitations inflicted on in-person dining, not knowing how to properly manage these food delivery tools can be the difference between a restaurant thriving and a restaurant having to permanently shut its doors. Fortunately, there's a solution.

RELATED READING: Restaurant Tech Trends to Embrace

What The Future Holds

As we move forward, we have to acknowledge that COVID-19 has impacted the way we do things, perhaps permanently. 

And some of the most significant changes are in the restaurant industry. 

Many restaurants have become dependent on online ordering to stay in business and those that haven't should certainly be looking into it.

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