COVID-19: Making sense of impact on the restaurant business

The restaurant business is one of the most competitive and tough to operate. Apart from an extensive organizational structure, there are a lot of external factors that diminish the chances of success of a new restaurant startup. These include an ever-shifting consumer choice, slim profit margin, a burgeoning expense in the form of sourcing products and employee salaries, wrong location, and much more.

While restaurant owners had to think about these problems, another one was looming at the door. Enter the COVID-19 crisis. After the full-blown onset of the global pandemic, there was an abrupt decrease in the demand for restaurant food. When governments enforced a strict lockdown, and the entire workforce shifted to the “work from home” setting, the lunchtime crowd of office workers vanished. Along with restaurants, retail businesses that carried out physical transactions were also amongst the economic sector that suffered the most.

Behavioral Shift Towards Dining

The Corona Virus spread brought about a seismic shift in traditional ways of eating. Not only could people not dine out in restaurants, but the takeout culture also stooped way below its previous statistics, as people were locked into their homes for two months. The statistics corroborate this grim reality for restaurants.

Even after the lockdown started to ease out, the fear of getting infected dropped down the number of people that sat in at restaurants to eat by a whopping 85 percent. This behavioral shift also prompted people to cook themselves. As medical experts all around the world prompted people to eat healthy food to boost their immunity, many people opted to cook from fresh produce that they could buy themselves from grocery stores.

This lead to the rise of people browsing the internet for organic solutions to food. During this time, the number of people finding recipes online at platforms such as  also increased profoundly.

Which Food Businesses Survived?

While most catering and restaurant businesses that survived on in house eating were devastated by a lack of consumers, on the other hand, certain elements of the industries saw unprecedented growth in their scale of operations. These included those that had perfected the art of food deliveries over the course of many years such as Pizza joints.

There are several reasons that prompted an increase of sales of pizza joints. Firstly, pizza joints had shaped their operations in such a manner where they relied more on making swift deliveries within 30 minutes, rather than serving people in the house. Furthermore, the process of pizza making has minimum human contact after the pizza has been placed in the oven. The pizza chef can use a pizza peel to take out the pie and place it directly in a fresh box, without any risk of contamination.

Lessons For Traditional Restaurants

Every economic crisis brings with a range of improvements that need to be co-opted in order to minimize future loss. Organizational experts suggest that every traditional restaurant that relied on in-house consumers has to diversify in order to survive. The best improvement they can adopt is to build a robust delivery system that can guarantee fresh food in a short period of time.

They should also come up with new menu items that are both convenient to package and quick to cook so that their order processing can become much more efficient. While no one can predict when things will back to normal for the world, these methods can definitely minimize the losses and allow restaurants to survive during this financial crunch.

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Author: Julia Harris
Graduated from Stanford University. Previously, he worked in various free news media. Currently, it is a columnist of the economy section in the Free News editors.
Function: Reporter
Julia Harris

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