As COVID-19 spread across the country, many provinces declared a state of emergency, closing restaurants and bars in an effort to flatten the curve. For those that were able, takeout and delivery orders became the new lifeblood of the restaurant industry and operators had to re-examine their business models in order to adapt to what many are predicting will be the new normal.
In this new normal, experts say the foodservice industry will likely see myriad changes — from the viability of sustainability programs, to the changing role of third-party-delivery services, to customers looking more closely at how restaurant operators treat their workforce — that will have far-reaching implications across every aspect of operations.
Changing the Model
When provincial governments began mandating restaurant dining-room closures in mid-March, operators were forced to pivot to takeout and delivery offerings in order to stay in business. For large operators with resources already dedicated to this model, the changeover was seamless.
“We’ve always offered takeout and delivery, so nothing [really changed], except for the fact [it became] the sole revenue stream for those restaurants in our system that still operated in jurisdictions that allowed it,” says Bruce Fox, EVP, Business Development at Vancouver-based Browns Restaurant Group. “The third-party-delivery landscape has changed rapidly in the last few years, so we’ve been ramping up as demand called for it. We’ve adapted with some practical operational solutions regarding better containers, order-accuracy methodology and safety/sanitation needs, but, generally speaking, all of this was in the pipe before the COVID-19 crisis hit us.”
But, for smaller, independent operators, the struggle to find safe and affordable alternatives to dine-in required more creative thinking. In Stouffville, Ont., a rural community northeast of Toronto with a population of a little more than 45,000 people, family-run restaurants outnumber chains. Many of these small, one-off concepts were not equipped to pivot to a takeout and delivery model and were forced to close their doors while owners tried to navigate the world of third-party-delivery platforms.
Main Street Bake House, a popular community hub, built a new e-commerce site and transformed its neighbourhood coffee-house concept to offer pre-ordered bakery-boxes that could be picked up or delivered three times a week.
“As a small, family business, we’ve been hard at work reimagining ways to continue engaging with you,” the owners posted on the company’s Facebook page at the launch of the initiative.
The Smokery Kitchen + Bar, an elevated casual-dining spot on Stouffville’s main street, began creating Family Meals to Go for takeout and delivery, along with
a scaled-down version of its seasonal menu.
And, while it may seem logical that the millennial cohort will be ordering most of the takeout and delivery, Jo-Ann McArthur, president of Toronto-based Nourish Food Marketing, warns operators shouldn’t discount Baby Boomers.
“That generation hasn’t adapted to online technology the same way, so they don’t have Uber Eats on their phone. But [during the crisis], you started to see their kids, their grandkids concerned about their personal safety and teaching them how to use [the apps]. So, while they weren’t technology adopters before, [this was the] tipping point for them as well.”
McArthur says post-COVID-19, the transparency diners have long demanded in terms of their food will now extend to treatment of workers — especially third-party-delivery staff. “There’s going to be a questioning of the gig economy, because a lot of people [who work in it] don’t have a social safety net,” adds McArthur. “And we know the average person is one paycheque away from not being able to make their rent.”
She adds the gig economy, which includes third-party-delivery employees, “while responsible for creating flexible employment opportunities for many, has inherent risks and lacks a social safety net. One of the things we’ll see [once we get back to normal] is a reckoning around the whole gig-economy model,” says McArthur. “It’s been starting to move to more of a collective, potentially unionized, model and you’ll start seeing that as well. [People will gain an] understanding that these workers are incredibly vulnerable.”
She says operators and customers will also be taking another look at the role of sustainability, adding an increase in single-use plastics could be seen very early on in the COVID-19 crisis. “Short term, it’s got to be personal safety over planet safety,” she says. “And also, [restaurants] that accepted bring-your-own-cup or bring-your-own-container stopped all of that because they didn’t want to put their staff at risk of touching something that may not have been thoroughly cleaned.”
In fact, in the early days of COVID-19, reusable cups were one of the first causalities of increased health-and-safety measures, with large chains such as Starbucks, Tim Hortons, Second Cup and McDonald’s imposing temporary bans on their use. And post-COVID, says one industry analyst, green restaurant practices are likely to continue to take a hit as customers choose safety over sustainability.
“The COVID-19 crisis will thrust reusable takeout containers and cups into the trough of disillusionment,” says Vince Sgabellone, foodservice industry analyst with Toronto-based NPD Group. “This was a great idea when everybody was worried about saving the planet for our grandkids. But, now everybody is so focused on their own survival for today that protecting the future will likely take a backseat for a while.”
Moving forward, McArthur hopes people will continue to get behind the hospitality industry “because it always suffers more than any other industry [during a crisis].”
After working on the frontlines of the SARS crisis in 2003, she recalls that good can come out of bad times.
“Out of crisis usually comes something really disruptive in terms of technology. In 2003, it was (e-commerce and technology company) Alibaba [out of] China,” she recalls, adding post-COVID, “touch [technology] is going to be a real issue, because at a lot of quick-serve restaurants you have to use touch for kiosks and such. So, I wonder if [the industry] will move more towards voice [-activated technology]?”
“Something will come out of this,” she predicts. “I don’t know what it’s going to be yet, but it always does — and it’s going to be super cool.”