Retail

Some Restaurants Opt For A Long Winter’s Nap

In September, the Centers for Disease Control (CDC) issued updated guidance about on-premise dining as follows: “Findings from a case-control investigation of symptomatic outpatients from 11 U.S. healthcare facilities found that close contact with persons with known COVID-19 or going to locations that offer on-site eating and drinking options were associated with COVID-19 positivity. Adults with positive SARS-CoV-2 test results were approximately twice as likely to have reported dining at a restaurant than were those with negative SARS-CoV-2 test results.”

America doesn’t have the appetite for this. We’ve had it. And restaurant operators are aware.

Though predictions vary, the dine-in restaurant sector seems destined for a long and decidedly lean winter. Taking a bite from the cave bear’s playbook, some are going for hibernation.

“We want restaurants to work so badly that we are willing to lie to ourselves,” Heather Mojer, co-owner and beverage director at Boston-based Big Dipper Hospitality Group, operator of the Café Du Pays, Mamaleh’s Delicatessen and State Park restaurants, wrote in an Instagram post.

“We know the act of dining is aerosol-generating, with the laughing, chewing, storytelling good times of a typical meal out. And it doesn’t take a scientist to tell you that you can’t eat with a mask on,” she wrote, as quoted by Boston.com. “Then, try to prove how well the ventilation works in the restaurant space.”

It’s not coming out of the blue. Summarizing new PYMNTS research, CEO Karen Webster noted on Oct. 5 that, “The number of consumers who report missing the physical store shopping experience have dropped by 20 percent since April. And as fond as consumers are of the restaurant experience, 10 percent fewer now say they miss eating at one.”

In spring, as lockdowns began to have their chilling effect, the National Restaurant Association (NRA) surveyed over 5,000 restaurateurs and concluded that “3 percent of restaurants have closed permanently, 11 percent anticipated closing permanently and 44 percent have closed temporarily.” By September, NRA said that 100,000 restaurants had closed permanently or indefinitely six months into the pandemic.

Winter Is Coming

Admittedly, things look bleak for restaurants, even as life resumes and economies reopen.

In The Great Reopening Edition of PYMNTS' Navigating the COVID-19 report series, researchers discovered that four distinctly new consumer personas had been forged by COVID fears. It is the “safety shifter” who perhaps best reflects consumers' sentiment on dining out.

PYMNTS found that close to 77 percent of those shopping less in physical stores plan to do so at least "somewhat less often" than before, per the report. It added that “safety shifters are also the most likely to say they plan to buy ingredients to prepare at home [and] eat in restaurants with waiter service … less often than before — even after the pandemic has passed.”

Additionally, in its September 2020 Local Economic Impact Report, restaurant review and reservation platform Yelp said, “The restaurant industry continues to be among the most impacted, with an increasing number of closures – totaling 32,109 closures as of Aug. 31, with 19,590 of these business closures indicated to be permanent (61 percent).”

“Foods that work well for delivery and takeout have been able to keep their closure rates lower than others, including pizza places, delis, food trucks, bakeries and coffee shops,” Yelp said.

Keep One Eye Open With eCommerce

Seasonal restaurants, from the seashores to the ski slopes, knew how to shut down and reopen efficiently and profitably before “pandemonics” changed everything. Disruptions to supply chains, consumer behaviors and a depressed travel market put much of this in doubt.

Though the “hibernation” of physical eatery locations may take on larger proportions as this winter wears on, small operators will keep one eye open, as it were, using digital.

San Francisco-based Samovar Tea Company is doing this by adding digital engagement, like virtual tea rituals, to sweeten the eCommerce appeal. “The closure or ‘hibernation’ of Samovar’s physical locations came after the spike in cases after July 4 and Gov. Newsom’s order to close indoor service at restaurants and bars,” reported told Bay Area news site MissionLocal.org.

As more restaurants elect to hibernate as a stopgap to permanent closure, mobile order-ahead (MOA) apps and aggregator platforms are pulling out the stops to digitize prepared food.

A recent example is the ordering and delivery platform Paytronix teaming with software titan Oracle on the new touchless MOA applications for the MICROS Simphony point of sale system (POS).

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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