Stats Of The Week
The State Of The Industry
Following weeks of dining room closures, to-go sales have increased by 96.4% in May from 66.8% in April, according to data from Black Box Intelligence. Their data represents more than 15,000 restaurants across 300 chain companies. During the coronavirus pandemic, dine-in sales declined by 99.3% in April with a slight improvement to 88.4% in May. The amount of chain and independent restaurants utilizing third party delivery grew about 36% from March 13 through April 13. Full-service chains had the largest increase with 104.8% growth in the adoption of third-party delivery channels.
Texas Restaurants Give Mixed Reviews On Reopening
According to a survey conducted by the Texas Restaurant Association, 60% of operators say it is unlikely their restaurant will be profitable within the next six months. On average, Texas restaurant operators reported a 54% decline in sales from May 1 to May 15 compared to the same period in 2019. Nearly 28% of full-service restaurants responded that the number of dine-in customers has been “steady”, while 26.3% rated business as being “slow”. Only 1.4% reported that they have been “packed” and 12.4% responded that traffic has been “very slow”.
What’s Trending
The President Signs The PPP Flexibility Act
On June 5, President Donald Trump signed the Paycheck Protection Program Flexibility Act into law. The law had been passed by the Senate the day before with Senate Minority Leader Chuck Schumer stating that businesses can’t wait any longer and are really suffering from not being able to utilize the changes proposed in the Act. The main benefits of this act are that it reduces the percentage of PPP funds restaurants are required to spend on payroll from 75% to 60%, it extends the time period businesses have to use the funds from two months to six months, and extends the amount of time restaurants have to pay back their loans.
Parts Of New York Enter Phase 2
After being shut down for nearly 3 months, regions of New York are reopening to allow residents to walk into retail stores or dine outside at restaurants. Last week, Governor Andrew Cuomo announced the seven regions of NY that have entered phase 2: the Capital Region, Central New York, the Finger Lakes, the Mohawk Valley, the North Country, the Southern Tier, and Western New York can reopen outdoor dining. To comply with restrictions, restaurants must space outdoor tables six feet apart, all staff must wear face coverings, and customers must also wear face coverings when not seated. Cuomo also unveiled plans for phase 3, which is expected to take place in July, where restaurants can reopen dine-in services. For phase 3, restaurants can reopen with half capacity indoors and tables must be placed six feet apart. For tables that can’t be placed six feet apart, the phase 3 guidelines call for restaurants to install barriers that are at least five feet tall.
Chef José Andrés Speaks To Dr. Fauci About Restaurants Reopening
Chef José Andrés hosted an Instagram Live with Dr. Anthony Fauci to address questions operators have on reopening dine-in services during COVID-19. Andrés started the conversation by asking Fauci how restaurants should determine when it is safe to reopen their dining rooms. Fauci responded by saying the intensity of the virus varies greatly city to city, and restaurants should consult their local health officials who are tracking local case numbers and monitoring the spread to determine when to reopen.
When it comes to effectively sanitizing restaurants, Andrés asked Fauci if owners should explore new technologies like UV lights. Fauci suggests a much simpler solution by wiping down surfaces with alcohol-based cleaners, which the virus is very sensitive to, and he adds that employees should be constantly washing their hands and use hand sanitizers themselves. Andrés asked Fauci when he thinks things will go back to normal and what words of wisdom he has for business owners.
“I would hope that as we get further into late spring and early summer, we’ll start to see a diminution. You may not get back to absolutely normal, but you’ll get back to something that resembles normality where you can start gradually opening up,” Dr. Fauci said.
McDonald's Franchisees Are In Favor Of Keeping A Limited Menu
A McDonald’s franchisee advocacy group, called The National Owners Association, is advocating to keep their limited menu as stores reopen post-pandemic. The organization told members in a letter obtained by the Nation’s Restaurant News that the limited menu and ease of operations allowed their teams to focus and provide blazing fast service. In a statement sent to Nation’s Restaurant News, McDonald’s USA said their temporary limited menu helped provide the best possible customer experience while simplifying operations in their kitchens along with simplifying operations for their crewmembers during the pandemic.
“We are partnering closely with our franchisees to monitor the impact of COVID-19 on restaurant operations and evaluate the best path forward for our national menu,” the company said.
Safety Is The Key To Reopening
Jack Li, founder of menu research firm Datassential, said restaurants should focus on safety and menu innovation over meal deals at a digital conference organized by Nation’s Restaurant News. Li said as stay-at-home restrictions begin to ease across the country, customers are entering a new phase from a place of helplessness to a place of caution. According to Datassential, the types of venues that guests feel safest at are restaurants with outdoor seating, quick-service chains with contactless drive-thru, fast-casual chains, and businesses that provide prepared foods or grocery deli. Li cited consumer data by Datassential showing that once shelter-at-home orders are lifted, consumers rank dining out as one of the top three things they look forward to doing.
“Eating at a restaurant is right up there with seeing family. That's remarkable. The mental benefit and the psychological benefit we get from restaurants and this feeling of normalcy that we derive from those sit-down restaurant experiences cannot be overstated,” Li said.
Bright Spots In A COVID-19 World
Chef Comes Up With A Unique Dish For Social Distancing
Chef Ethan Rodgers has come up with an innovative lunch special for two people who want to share lunch while following social distancing guidelines: the “Back to Work Baguette”. Measuring 6.5 feet long, the massive bacon and sausage sandwich was created with the help from a bakery, deli, and restaurant in Cirencester, England. While dining-in restrictions aren’t planned to loosen until July in England, Rodgers has been happily sharing the sandwich with the staff members that helped him create it and offers the sandwich for £20 for delivery only.
Red Lobster Reignites Date Night
As the majority of the country chooses to stay home to avoid spreading COVID-19, Red Lobster is looking to keep love alive by providing all of the tools need for a romantic night at home while social distancing. The restaurant chain has created Date Night Deals that serves two and comes with an appetizer to share, an entree, and a side that serves two, along with two desserts. The deal also includes virtual elements like a customized playlist and unique Zoom backgrounds to recreate the experience of dining in a restaurant.
Quote Of Hope
“My advice to the people in the restaurant industry is that, please try and hang in there because this will end. It is not going to be forever. Part of our culture that makes us happy is going out to restaurants. It’s a very important part of our culture. Don’t give up. We will come to an end to this, really.” - Dr. Anthony Fauci, the country’s top infectious disease expert, said.
