National Restaurant Association – Pandemic Inspired Business Strategies with Traction

A person using a payment terminal in a restaurant - Source National Restaurant Association
Operators have embraced contactless transactions that let customers order and pay directly from their mobile phones, accessing the platform through a QR code.

In the pandemic’s darkest days, resourceful restaurant operators developed innovative solutions to keep business running. Some strategies proved so effective, they’re likely here to stay, even as dining restrictions lift. The National Restaurant Association identified “trends with traction” in its State of the Restaurant Industry Mid-Year Report, to be released Aug. 24.

In the pandemic’s darkest days, resourceful restaurant operators developed innovative solutions to keep business running. Some strategies proved so effective, they’re likely here to stay, even as dining restrictions lift. The National Restaurant Association identified “trends with traction” in its State of the Restaurant Industry Mid-Year Report, to be released Aug. 24.

Accelerated tech adoption

When dining rooms closed or limited capacity, to-go service became paramount. Restaurants quickly upgraded online ordering and digital payment technology to keep up with demand. Technology that was nice to have before suddenly became a necessity—and now is expected by consumers.

Potbelly revamped its website and app, enabling easier customization and simplified re-order options. Panera added geofencing technology that speeds up curbside service by automatically notifying the eatery when pickup guests arrive.

Operators embraced tech solutions that allow for contactless transactions, like GoTab, which lets customers order and pay directly from their mobile phone, accessing the platform through a QR code.

As dining rooms and bars reopened, this type of technology has eased the labor crunch, allowing guests to pay their checks or order another round of drinks without having to flag down staff.

Tech also provided operators with real time information that enabled them to stay agile and make fast, but informed decisions as COVID-19 altered the business landscape.

Tender Greens uses an accounting system that automates information gathering, consolidating data from multiple sources (POS, scheduling software, inventory management), and generating real-time performance reports the restaurants need to quickly adjust operations, menus, suppliers, labor, and more.

Alcohol-to-go

Early in the pandemic, many states passed emergency measures allowing alcohol-to-go sales—a lifeline for struggling restaurants. At its high point, 39 states permitted cocktails-to-go in some way. In many locales, it appears the trend is here to stay. As of August 4, 2021, 16 states have made cocktails-to-go permanent and another 13 have extended permission; a decision is still pending in three states.

Restaurants embraced portable potables, offering wine and beer, as well as premixed cocktails in bottles, mason jars and pouches. Capo Deli in Washington D.C., serves its Fauci Pouchy cocktail in a plastic pouch imprinted with a picture of coronavirus expert Dr. Anthony Fauci. In states where off-premises alcohol sales are allowed, 89% of operators who serve alcohol are selling it to-go, according to the upcoming Association report.

Off-premises dining

The pandemic spurred an expansion of drive-thru restaurants. Taco Bell launched its Taco Bell Go Mobile concept offering a dual-lane drive-thru with a priority pick-up lane for customers who order via the restaurant’s app. Krystal, a regional quickservice chain headquartered in Atlanta, introduced a prototype that 86-ed its dining room, featuring a walk-up order window, pickup area and double-lane drive-thru.

Cloud kitchens emerged as rainmakers, pouring in a much-needed infusion of cash. These ghost kitchens focus on delivery, operating with a reduced-rent footprint by nixing the dining area. Some function like a digital food hall, letting customers mix-and-match menu items from several concepts operating under one roof. At Kitchen United Mix in Austin, Texas, customers can order a pizza from Grimaldi’s, vegan bratwurst from Plant B and Tandoori Chicken from Teji’s Indian Restaurant.

Streamlined menus

When the pandemic compromised supply chains, restaurants reduced their inventories, honing menus to focus on customer favorites that traveled well and could be produced by a smaller staff. Slimmer menus may be here to stay.

“We're going to keep [the menu] lean,” Applebee's President John Cywinski told CNN Business in May. Applebee's trimmed its menu from roughly 160 items to about 100, cutting items that were complex to prepare and didn’t sell well. Simplified menus allow for less food waste, faster prep times and reduced labor needs.

Upscale restaurants also streamlined their offerings. New York City’s Dirt Candy simplified dinner to one five-course tasting menu, eliminating its 10-course option. Farm-to-table Vie restaurant in Western Springs, Ill., elevated its dining experience—with budget in mind—by introducing a seasonal prix-fixe menu and dropping most a la carte offerings except a few signature items.

Outdoor dining

Operators welcomed guests into the great outdoors, investing heavily in all-weather tables, canopies and portable heaters. With the blessing of local jurisdictions, restaurants opened impromptu seating in public sidewalks, parking lots and roads that were transformed into “streeteries.”

Among restaurant operators that expanded their outdoor seating onto a sidewalk, parking lot or street since the beginning of the COVID-19 outbreak in March 2020, 90% say they plan to continue offering customers this option if their jurisdiction continues to allow it after the coronavirus crisis is over.

Outdoor dining continues to be in demand, with some guests preferring the fresh air, particularly with the rise of the coronavirus’s delta variant. Operators with their own outdoor dining space are in luck, but the picture is mixed for those using public space.

The future of public outdoor dining is unclear in Boston’s North End, where some residents complain about crowded sidewalks and a lack of parking. Meanwhile, many jurisdictions have extended outdoor dining ordinances. Chicago’s iconic State Street closed to traffic Sundays this summer for a block party featuring entertainment and al fresco dining.

This article is brought to you by Sage Intacct, sponsor of the National Restaurant Association's State of the Restaurant Industry Mid-Year update