COVID19 is not only one of the gravest public health crises in the world, but also one of the most devastating challenges faced by the hospitality industry. The true figures of how much the industry has suffered are hard to pinpoint as the pandemic is still ongoing.

Recent estimations have shown that nearly 70% of all North American restaurants have suffered lay-offs or furloughs due to the pandemic. According to the National Restaurant Association, nearly 3% of all U.S. restaurants have shut shop, with a further expected number of business closures at 11% of the entire industry.

The COVID19 pandemic is the biggest crisis to have ever confronted the hospitality industry, and it has blind-sided many ‘industry experts’. You have seen it haven’t you, the pressure building up as the news of lay-offs and business closures slowly creep into the forefront of your imagination.

While it might seem like the end of the road, and we did start off the article with a rather bombastic opening, all is not lost yet. The hospitality industry has started to evolve at a much faster pace, according to a recent survey in the United Kingdom, since the beginning of the pandemic online food deliveries were up by 11.5% compared to previous years. This increase also coincides with a rise in online food delivery app users by a margin of 9.8%.

If the numbers are any indication, then the question isn’t will you survive, the question is how! Hence we take a holistic assessment to understand the impact, containment/mitigation, and reopening of the hospitality industry so that you not only survive the pandemic but thrive in it!

How Has COVID19 Impacted The Hospitality Industry?

The short and simple answer would be that it has completely devastated the hospitality industry, as in a report by the California Restaurant Association, it said that close to 30,000 of the 90,000+ restaurant businesses would shut-shop in the state alone.

Another critical insight that this pandemic has given us is the often postulated segmentation of the restaurant industry as a whole is indeed true. Even though the pandemic has hit everybody in the business, the impact has not been the same on everybody.

For example, Fast-Service restaurants like Pizza joints have either maintained or in some cases increased their sales during the pandemic. When you compare that to Full-service restaurants, the story is entirely a different one as many fine-dining restaurants have seen revenues dip to zero.

The difference between whether or not your business will take a dip in revenues is largely dependent on the following aspects:

#1 Revenue Generation Streams

The majority of restaurant business before the pandemic had two streams of revenue pouring in, dine-in & takeaway/online ordering. Traditionally an average restaurant would derive the majority of its revenues from its dine-in stream, but with the pandemic, that stream has run dry.

Restaurants with a more moderate or even higher volume of online ordering/takeaway deliveries are doing far better when compared to the latter. Since the beginning of the pandemic, online food ordering platforms in Brazil have seen a gargantuan 44% increase in order frequency.

#2 Restaurant’s Reliance On Daily Operations

While it is true that a majority of Quick Service Restaurants have been able to survive the pandemic well enough, not all QSRs are made the same. As the majority of workforce operations around the world have been shifted to Work From Home, many popular QSRs that specialize in lunches & daytime eating have taken a drastic hit.

These QSRs would include your traditional coffee shops, breakfast dinners, sandwich parlors, hotdog stands, etc. Due to these businesses serving people on the run when people don’t commute they suffer.

#3 Geographic Location

The geographic location of the restaurant played a critical role in determining whether it will survive the onslaught of the pandemic or not. As COVID19 is a highly infectious disease that spreads faster in close urban communities like our modern cities, restaurants in these cities suffered the most.

On the other hand, restaurants that were located in rural and less urbanized parts of the country saw a moderate decrease in walk-in customers that was manageable. Here is a statistical analysis from McKinsey & Company illustrating the same:

#4 Digital Presence

Restaurants with a higher and more robust digital presence have been able to glide through the pandemic quite smoothly. A strong online food ordering network powered by your mobile app, integrated loyalty programs, and data-driven Customer-Relationship-Management systems have been at the vanguard of protecting restaurant businesses.

China saw a 21% increase in digital transaction and online food ordering post-COVID19, this goes on to show that a robust digital presence powered by your own personalized food ordering app can enable you to not only hold your ground but also march over potential pitfalls of the pandemic.

Pro Tip – #Restaurants is an end-to-end restaurant management system for restaurateurs allowing them to manage their menus, their outlets, and their orders. Along with a cloud-based restaurant management system, it comes with a white-labeled mobile application in Android and iOS for customers to order food online. Click here to learn more

What Should Your Future Strategy Be?

The above data points given an overall understanding of the impact and the containment/mitigation of the COVID19 pandemic, what it does not do however is tell you what you should do next. Hence here are our recommendations of what your future growth strategy should look like:

#1 Rightsize Your Business

Before the pandemic, you had experienced an uninterrupted spurt of growth that led to making rather poor choices, the reason you didn’t feel the brunt was because everything was going fine. It is only after the pandemic that you understand that having too many employees & restaurant locations doesn’t give you an operational edge, it just adds onto the bulk.

Hence you must take corrective measures and rightsize your business to better meet the new operational realities & challenges of the post-COVID19 world. Cut down unnecessary redundancies and streamline your operations to increase productivity!

#2 Standardise Your Operations

As the country slowly opens up you get the once in a lifetime opportunity to re-write how you operate your restaurant. Once you have rightsized your business now is the time to establish SOPs or Standard Operating Procedures for your restaurant that help you declutter your operations and create a clear strategy for action.

As a result, you reduce the wastage of resources that save money and enable higher operational efficiency that results in faster and better service quality in these critical times. With SOPs you will be able to handle the onslaught of customers once the consumer-demand corrects itself even with a small number of staff.

#3 Deploy Integrated Marketing Campaigns

Depending on how long the overall pandemic lasts, your customers will be somewhat accustomed to home-cooking as they shift their lifestyle. You can’t just expect to get consumer demand and growth back on the first day of the pandemic being over. Hence you must deploy comprehensive digital marketing campaigns to woo potential customers before they even leave their homes.

Re-engage your previously loyal customers with personalized deals, coupons, and offers that entice them to order with you again. Having your own personalized food ordering app plays a crucial role in this quintessential tactic to get your growth back. With your mobile app, you get a direct window to not only interact with your customers, but also attract them to go for contactless table ordering, online delivery, and much more.

#4 Go Digital All The Way

Online food delivery has been knocking on the door of the hospitality industry since the last five years, the best that we could do was a partner with predatory third-party food delivery apps that charge your restaurant to bankruptcy.

Hence this pandemic is the right opportunity for businesses to take control and establish dominance by going digital all the way with the deployment of their own personalized food ordering apps.

With your own cloud-based restaurant management system and mobile application, you can now offer your customers contactless table ordering, rapid online food delivery, and easy food pickup options. Now you don’t have to worry about losing business due to social distancing, as you turn the crises into a growth opportunity!

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#5 Redesign Your Restaurant Establishment

It might sound like a drastic step, but the pandemic has fundamentally changed the way humans interact with each other. The focus on social & physical distancing has become paramount in the post-COVID19 world, and if you want to get dine-in customers back you need to rethink your restaurant premises design.

Therefore you must incorporate designs that encourage social distancing and maximize the limited space you have for operational productivity. You may have to reduce your setting capacity to ease the anxiety of people when they see crowds again once the country starts to open up. You may also have to use face-shields, protective barriers, automated doors, etc. to decrease physical interactions to the minimum amount possible.