As 2020 progresses, many restaurants have a question mark hanging over them. COVID-19 has changed the way that business must be done; whether that be for better or worse. The following trends are those we observed prior to COVID-19, those during the pandemic, and those we see continuing to persist after the pandemic ends.

Delivery and Takeout Demand Surges

o   Through 2019 and into early 2020, delivery and takeout services such as UberEats, DoorDash, and SkipTheDishes began to grow steadily in popularity. The ability to have popular restaurants menus at your fingertips without sitting in the restaurant, or even leaving your home, fit perfectly into what we like to call the “age of convenience.”

Takeout Pizza

As we entered the COVID-19 pandemic, this popularity of such services grew exponentially, only this time it was out of necessity and not convenience. Now that we have entered a time where delivery and takeout are not only the sole source of service, but also revenue generation, restaurants and lounges must shift their operations to embrace this change moving forward. As the World begins to recover from COVID-19, having this solidified workflow for delivery and takeout will provide an additional revenue stream, as opposed to the only one. We fully expect to see delivery and takeout surge forward for long after the end of pandemic.

Fast Casual / QSR Format Will Continue to Take the Top Spot

o   We previously spoke about being in an age of convenience, and our next trend falls into that age of convenience quite well. We’ve seen quick service and fast casual restaurants rise in popularity in recent years; consumers enjoy a quality product, but don’t necessarily enjoy the appeal of making an entire night of the experience. This is where quick service and fast casual restaurants come in.

Quick Service, also known as “fast food” has been the most popular format for some time, as it’s fast, it’s simple, and consumers get consistency with the product. Fast Casual takes the second spot, offering a high-quality product with a higher price point, while still emphasizing the speed of service. What makes both these formats popular is the convenience and speed of them, and moving forward, our belief is that these formats will continue to flourish in the future, especially so if health authorities emphasize on minimizing contact for the foreseeable future.

Increases in Portion Control

o   As the restaurant industry tightens, so too will the need for stricter portion control. As we have seen with many restaurants, portions are too large for customers to consume in a single sitting, with 17% of diners’ meals going uneaten. (SOURCE) This represents a large amount of wastage that could be staying in your pockets.

Orange

Due to this, we expect to see an emphasis on recipe and menu costing, allowing restaurateurs and chefs to manage their food costs effectively and efficiently. A restaurant’s ability to survive in our current climate can be determined by shaving one or two points off this cost, and as such, we expect to see plate sizes shrink in 2020.

 

 

 

Biodegradable / Plant-Based Containers and Utensils Will Become Commonplace

o   Prior to 2020, we saw the beginning of the end for single-use plastics in restaurants and bars. The greatest shift in this trend was the replacement of plastic straws with plant-based ones in many QSRs. We see this trend continuing with not only the adoption of plant-based straws, but also in more takeout containers, and even more so with single-use utensils.

While these plant-based alternatives cost more than their plastic counterparts, the environmental benefits and goodwill associated with the use of them outweigh their cost, and may ultimately shift business in your direction if you adopt early enough. Those businesses late to adapt may LOSE revenue, as their customers choose to give their dollars to establishments that embrace the change early.

Adoption of Plant-Based Meat Replacements Slows

o   Prior to 2020, we saw a large push for meat replacements including Beyond Meat; however, in the final days of 2019, this adoption slowed. Tim Horton’s removed their meat replacements from the menu, and other organizations slowed their marketing push for these products.

Beyond Meat

As we move through 2020, we expect this trend to continue, and as people will tend to stick to their comfort foods when life around them is uncertain. This does not mean that plant-based meat replacements will be disappearing completely, but the push for organizations to adopt them and market them heavily will slow and businesses will push products that are tried and true.

Smaller Menus

o   To pair with the smaller portion sizes, we expect to see menus shrink in size in order to make inventory a much more manageable task. In the past year, we have seen restaurants choosing to go with small menu sizes as opposed to the books used in the past by companies such as The Cheesecake Factory.

Having a smaller menu also means that restaurants are able to adapt and change their menu in a short period of time, as new ingredients become available, and others become unavailable, a chef can make the changes to one or two dishes, instead of reworking many different recipes. This smaller number of ingredients can also translate to making recipe and menu costing a much more efficient process.

Moving to Smaller Locations

o   As the trend of less people dining in at restaurants continues, we expect to see newer restaurants, or existing ones, looking at smaller locations as opposed to much larger ones that can seat as many covers as possible. By doing this, restaurateurs allow themselves to manage costs much more easily, as their required inventory will be lower.

Small Cafe

This lower inventory ensures that there’s less wastage, greater inventory turnover, and inventory management becomes less time consuming. In addition to inventory, depending on the location, rent may be lower in these smaller locations, freeing up greater capital for room improvements, staffing, or kitchen upgrades.

 

As we can see, the restaurant and lounge world is seeing seismic shifts in how business is being done, from business models, to menus, to locations, everything is changing rapidly both out of willingness, and necessity. We’re less than halfway through 2020, and we look forward to seeing what the future holds for everyone in the industry!