A Permanent Impression: Covid-19 and the Future of the Restaurant Industry

As we look back on what has categorically been the most testing year that our industry has endured, the indelible message that has reverberated through our repertoire of articles is clear — unprecedented times call for novel solutions. Whether that refers to the groundbreaking innovation in restaurant technology, radically new marketing & customer-engagement strategies, or a heart-warming increase in unity within the entire restaurant ecosystem, 2020 has been a year of ingenuity, adaptability and unprecedented change.

Of course, COVID-19 has also brought changes — in some cases probably permanent — that no amount of data analysis or savvy intuition could have predicted in 2019. These changes involve everything from the exponential growth of takeout and delivery to the blossoming of European-like outdoor dining areas, as well as the sad fact that many thousands of restaurants have been affected so much by the crisis that they have simply ceased to exist. These, for instance, are the saddest restaurant closings of 2020.
—Excerpt from USA Today

Throughout the course of the pandemic, we have sought to present you with well-researched opinion pieces on public policy and financial aid, the plethora of advancements and inventions within the industry, and tips on how best to navigate these perilous times. In this piece, we hope to guide you in the right direction to prepare for the future by compiling a list of topics that we believe have been permanently influenced by the Covid-19 outbreak, and will remain prominent in the post-pandemic environment…

Ghost/Cloud Kitchens

In an industry where 60% of new entrants fail within the first year and nearly 80% don’t survive long enough to celebrate their fifth anniversary, it was inevitable that a data-centric approach would be the impetus that VC’s needed to step in and revitalise things. In the past few months, that’s exactly what we’ve witnessed. The most glaring example of this is the advent and subsequent meteoric success of Cloud kitchens.

Offering lower capital investments; there’s virtually no money spent on decor, you don’t need to shell out the bucks for a prime location or train a large serving staff for a food production facility where a plethora of restaurants rent space to prepare dishes from their delivery-optimised menus, as well as a sizeable advantage in terms of scalability, Cloud kitchens are indeed the hottest topic in food tech.
—Excerpt from The Big Picture

Industry experts speculate that ghost kitchens will operate much like food trucks of the past, enabling restaurateurs to experiment with novel ideas without having to found a full-blown establishment.

Increased Diversity

The food service industry already employs more women and minority managers than any other part of the private sector, and the industry will almost certainly become increasingly more diverse over the next decade. In addition, as the nation’s population continues to grow more diverse — and the number of older Americans increases — these demographic changes will be reflected in both the customer base for restaurants and their workforce, below management level as well as in supervisory positions.

Contactless & Hygienic Practices

In some of our previous blogs, such as Contextual Innovation: How restaurants have adapted to prioritise health & The Contactless Conundrum we presented concepts such as the exponential increase in the use of QR-code based menus and billing systems, the emergence of contextual startup businesses that are focused towards diner safety and hygienic operations and the growth of delivery integrators, online ordering, delivery and takeaway as the primary mode of business transactions. The magnification of this topic is unlikely to fade in haste.

Outdoor Dining

We showcased the ingenuity of using pods or outdoor greenhouses in our blog post titled Pandemic Panacea, with this video by euronews. This particular solution (one of the first to emerge) from Mediamatic, an art centre in Amsterdam is not only practical and attractive, but facilitates an intimate dining experience for two.

This concept has been refined in the last few months, with the utilisation of tents, parking lots, backyards and even simple curb-side table setups, owing to the laws pertaining to outdoor dining being arguably the most tangible respite establishments have had through this difficult year. We believe that the concept, previously more prevalent in European cities, will become a mainstay of American dining as well.

Alcohol-to-go

Laws in most places used to prohibit restaurants from adding a bottle of wine or a couple of Cosmos to pickup or delivery orders. With bars and eating places in much of the country closed either completely or partially since the pandemic arrived, a number of cities and states began allowing establishments to furnish adult beverages along with food. New York, California, Texas, and Illinois are among the states that have adjusted their regulations to permit this. In some cases the new rules are only temporary, but in others, alcohol to go is probably a permanent phenomenon. Some operators are even creating their own liquor and cocktail brands and selling drinks in large formats — like Margaritas by the gallon.

Technology & Personalization

While integrating technology has been the defining factor of almost all development strategies in the recent past, amidst the throes of a global pandemic it has become absolutely imperative. Not only does the restaurant industry need technology for its primary service — increasing efficiency, but also for its several ancillary benefits.
—Excerpt from Digitise or Die

Technological innovation has been the most rampant avenue of expansion, with solutions such as Moley’s Robotic Kitchen, foodtech apps and Mozo by MARSES Robotic Solutions, among several others that we have expounded in our writings.

According to the National Restaurant Association, by building on existing social media marketing programs, operators will get more personal and localized, perhaps using geo-tracking and even facial recognition technology to anticipate customer needs and wants. More on this topic can be viewed in our article titled The Marketing Blueprint.

*Increased Diversity & Alcohol-to-go excerpts via 24/7 Wall Street

Please reach out to aman@dashin.in for any feedback or clarifications regarding the content of this article.