COVID-19 and What it means for restaurants

pandemic restaurant industry

On Wednesday, The World Health Organization declared the COVID-19 coronavirus outbreak a pandemic. The panic that this is going to cause will have rippling effects on everything from the worst day on Wall Street since 1987, to falling oil prices, to cancelled flights between Europe and US. Analysts suggest that the worst is yet to come and most probably it's going to get much worst before it gets better.

This crisis is going to impact a lot of businesses and especially those providing in-person services like restaurants. In this article we're going to talk about what effect this crisis is going to have on the restaurant industry and how small restaurants and chains can survive through it.

Rise of Remote Ordering

With people more concerned than ever about physical contact and communities and families on quarantine to keep the vulnerable safe, we've already seen the rise of remote ordering. People have started to call-in their orders instead of dining in or staying in lines to place their orders. Many restaurants are even going a step further, offering curb side pickup to reduce the contact. The trend is already shaping up, as Starbucks CEO said customers may only be able to order via drive-thru or mobile due to corona virus.

Ghost Kitchens and Pickup only Restaurants

Although ghost kitchens were becoming more and more popular due to the better economics and the less capital intensive business models, they now have one more advantage over full-service restaurants: fewer people entering the premises where food is prepared means lesser chance of contamination and spreading the COVID-19 virus. This is an important advantage that has already made many restaurants close doors to dine-in customers and provide only pickup and delivery services. As the pandemic gets worse, we should see more ghost kitchens popping up.

In-house Delivery to come-back

As people are trying to stay indoors and reduce the number of unnecessary trips, we'll see a surge in delivery orders. Although this could mean a surge in orders to 3rd party delivery companies, this could also mean that the restaurants' in-house delivery could come back as well. Not only a higher number of delivery orders can make it financially viable for the restaurants to have their own delivery teams, having fewer people to come to restaurants to dine-in would mean more staff will be free to help with the delivery side of the business as well.

Role of Technology

For bigger brands that have access to more funds and technology teams these changes are less concerning. They already have the tools at their disposal to facilitate online and mobile ordering, enable 3rd-party delivery or have their own in-house delivery teams. Local restaurants and small chains on the other hand are the ones that will get the surge in phone calls which will be time consuming, resource intensive and error prone. In addition to the rise in phone-in orders, the restaurants will probably be dealing with some shortage of staff due to the virus and precautions that need to be taken. This is where technology could come into play to help facilitate the transition.

Online/mobile ordering and order-ahead technologies will be able to help and enable customers to place orders without requiring resources such as your staff. Integration between the mobile/online ordering platforms and POS systems and payment processors help to make the ordering process is as seamless as possible.

Delivery management systems and routing apps will also be a great part of the solution. They can make the in-house delivery process much easier and more efficient. Plus you'll have the ability to taping into 3rd party delivery services on-demand.

Technology is going to help restaurants stay afloat as we go through this pandemic. This crisis is going to affect many people and a lot of businesses, from small to large. The key is to be ready for the changes that are coming and adapting to the ever-changing circumstances.

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