Even before the pandemic, ghost kitchens were on the rise for their ability to ensure faster, less expensive food preparation and more efficient delivery to customers looking for off-premise dining options. Now, many restaurant operators are looking at ghost kitchens as a critical way forward at a time of great uncertainty for the industry. They may be on to something: Recent research from Euromonitor found that the global market for ghost kitchens could reach $1 trillion by 2030 – and in the process, capture big slices of industry segments including drive-thru sales, take-out foodservice, ready-to-eat meals, pre-packaged cooking ingredients, dine-in foodservice and packaged snacks. But when you’ve been running a traditional brick-and-mortar restaurant, what actions (and investment) are required to pivot to the ghost-kitchen model? Food distributor US Foods is aiming to give operators a hand with that transition through its newly launched US Foods Ghost Kitchens program. The company promises that for an average start-up investment below $5,000, they can help operators open a ghost kitchen concept in about three weeks and achieve an average profit margin exceeding 35 percent. The program includes market research, marketing support, a digital technology framework, menu optimization and management guidance.
COVID-19 has turned the employee training rulebook on its head – and it’s a major area of investment among restaurant operators right now. A June survey of senior executives in retail and hospitality found that for 75 percent of respondents, employee training was their highest priority – well above even contactless payment (48 percent). At a time when fluctuations in COVID-19 cases are causing mandates to change at the state and local levels, it’s critical to be able to contact your team (and have them take appropriate precautions) before they even walk through your doors. Can you connect with your staff at a moment’s notice? Before flu season adds to the strains of the past several months, now is the time to assess weaknesses in your communication protocols and ensure everyone on your staff receives alerts about important operational changes promptly – and understands how to adjust to new mandates as needed.
Yet another aspect of restaurant life that has shifted in recent months is the typical hour when people are consuming restaurant meals. As people have stayed closer to home – both during and after work – they have also altered the lunch and dinner rush. Even as lockdowns have eased, those changes may persist: A Datassential survey of 1000 consumers that was conducted in May found that 35 percent of respondents planned to avoid peak busy times at restaurants – even after lockdowns eased. But instead of seeing this as a negative, could there be advantages to spreading traffic out through the day and evening and not having a crowd for dinner on a Saturday night? Consumers’ perception of time has shifted with the pandemic. Can your incentives capitalize on that? Getting your customers to come in for dinner on a Tuesday or a Wednesday night instead of a weekend may be easier to sell right now. Lunch may not need to fit squarely between certain hours when people are working from home. More people may be open to picking up an extra-early dinner. Case in point: QSR reported recently that Dunkin’ had significantly grown its year-over-year sales between the hours of 11 a.m. and 2 p.m. as a result of offers to “entice guests to join, reactivate, and use DD Perks to make their transactions.” In other words, the brand effectively enticed customers to come in during once-slow periods. How can you harness your rewards program and marketing efforts to drive traffic at odd hours? If you have a lot of customers who are socially distancing now, you may be giving them just the incentive they need to support you.
The capacity to offer outdoor seating is changing the competitive landscape for restaurants right now. Datassential surveyed consumers recently about their perceived safety of a long list of places, ranging from food trucks to grocery delis to stadiums. Restaurants with outdoor seating topped the list, with 63 percent of consumers perceiving them as safe places to go when restrictions are lifted. But is outdoor seating a feasible longterm solution, particularly as the weather gets cold? Air quality has been a key factor in allowing restaurant dining rooms to reopen during the pandemic – and ventilation of indoor spaces is likely to become a growing concern for operators who want to continue to serve people in dining rooms. In Florida recently, McDonald’s unveiled its first net-zero energy restaurant, which includes a new automated energy system and passive ventilation dining room designed to circulate air and regulate temperature. Further on down the ladder, look for more restaurants to incorporate potential air quality fixes like ultraviolet lights – such as the ones installed in the grated ceiling at Marlaina's Mediterranean Kitchen in the Seattle area. The technology holds promise: NPR reports that research shows close to 90 percent of airborne particles from a previous coronavirus (SARS-CoV-1) can be inactivated in about 16 seconds when exposed to the same strength of ultraviolet light as in the restaurant's ceiling.
Everyone needs to eat – but the experience of eating at a restaurant or enjoying restaurant food is something that will keep consumers coming back to your business, particularly if they have had to cook for themselves for several weeks on end. Recent Toast research found that 78 percent of Millennials would rather spend money on an experience such a restaurant or activity than on an item at a store. Whether guests are dining at your restaurant right now or opting for delivery, you can fine-tune the experience you offer. First, focus on making your brand come through effectively via delivery. Ensure your menu of delivery items travels well and represents the best of what you can offer off-premise – and take care to update it online, particularly if you have introduced new items recently. When you send out an order, help customers connect with your business – Deliverect suggests small acts like a handwritten note or a smiley face on a receipt can go a long way, or you can enclose a small photo of your team to introduce customers to the people who are working hard for them behind the scenes right now. Provide vouchers or other promotions to increase future deliveries and in-house orders. Think about how you can get people back to your restaurant once people are ready to dine out again: Stay in touch with other business owners in your community to plan potential events together, and keep your conversations with guests going on social media (share some photos too) so you’re front of mind for them when they are ready to dine out.
To be sure, there are plenty of gloomy news headlines about the restaurant industry right now – and more than ever, restaurants need the support of their communities to recover. But at a time when it is easy to feel overwhelmed by the multitude of challenges standing in the way of rebuilding business, take heart in the examples of operators who are somehow doing better than ever right now. They are succeeding, seemingly, through a combination of letting go of ego, ignoring the desire to keep items on the menu out of sentiment, being willing to flex to new business conditions each day, and focusing on what people need right now – even if it doesn’t necessarily mesh with the polished brand the restaurant had in its beginnings. Take Alinea veteran Eric Rivera of the Seattle restaurant Addo. A report from Wired details, Rivera has been offering an ever-changing menu of items ranging from $9 food bowls, to meal-and-wine packs, to eat-at-home versions of his 20-course tasting menu during the pandemic. He has even thrown in some Game of Thrones- and Seattle Mariners-themed dinners to mix things up. The constant changes give him some new fodder for social media promotion on an ongoing basis, and people are linked from Addo’s social media posts to its Tock sales platform, which allows customers to order meals in advance (and Rivera to better manage inventory and waste). Addo’s dining room now looks more like a warehouse and the employees who once served a roomful of guests are now staffing in-house delivery for the restaurant.
“No one really had this in their playbook.” That’s what one conference planner said in a recent New York Times report about how the pandemic has forced changes to conferences and business meetings – and the hospitality surrounding them. Restaurant operators who hosted events before the pandemic have faced an equally steep learning curve. Now, as guests begin returning to dining rooms and we all look forward to being able to safely gather in larger groups for parties, weddings and less formal celebrations that have been put off in recent months, how can you plan accordingly? If you’re feeling ready to take bookings for events later this year and into 2021, your event management protocol will naturally need an update – and it’s something you can promote to your guests now to encourage their business and demonstrate your commitment to keeping them safe when they gather. As you think about replacing buffets and self-service stations, how can your menu, service model and staffing plan flex to accommodate it? Can you cover or wrap food items, plates and utensils to minimize cross-contamination? Serve individual plates to guests either at the table or in a buffet line? Transition to fixed menus that minimize waste and are easier to prepare and serve? Adapt your indoor and outdoor spaces to ease traffic flow and allow for better ventilation? Your service agreements – both with guests and any vendors you use – may need an update as well to help protect safety and ensure you are protected legally in case lockdown measures force cancellations down the line.
The reopening of restaurant dining rooms across the United States has been a study of extremes, whether in terms of guests’ responses to restaurant reopenings, operators’ willingness to enforce new health and safety guidelines, or even the guidelines themselves. As we enter the summer months and jurisdictions look to accommodate outdoor dining in previously unseen ways, we’re likely to see an even broader range of approaches to kick-starting restaurant sales. While your state and local authorities detail the precautions your business must take to protect against the spread of COVID-19, there is also room for some imagination within the rules you must follow. Hearing from operators who have deftly maneuvered through their own reopenings may help you sidestep some challenges (or even just plain awkwardness, like how to go about confirming the accuracy of orders when everyone in your establishment must wear a face mask, or determining how guests can best store their masks while they eat). A new website launched by Team Four Foodservice, www.foodserviceceo.com, can serve as a guide to the many guidelines restaurants are following right now. The site includes information from health and safety authorities but also recommendations from industry consultants. It may offer you some ideas that make sense to implement in your business. In any case, leaning on your network of restaurant operators as you reopen can help you tackle existing challenges and anticipate potential ones.
Does your menu look different right now? Scrutinizing it will help you make sure you’re not only staying on trend but are also providing value, minimizing waste, spending money wisely, considering the production capacity of your staff, and offering foods that are best suited to where customers are most likely consuming them – whether that’s in your dining room or off-premise. New research from MicKinsey entitled “How Restaurants Can Thrive in the Next Normal” advises operators to start out by offering their usual menu, emphasizing core dishes and comfort foods. Then attract customers to your value items and upsell from there. It will likely be necessary to reprice some items to compensate for current market fluctuations. A separate report from Johnson & Wales advises operators to identify ways to reduce the work needed to prepare menu items, particularly if they’re working with a scaled-down team. Consider keeping a mix of proteins, pasta and vegetarian items on hand, then rotating in a new category on a two-week rotation to keep things interesting. Even if you have a loyal following looking to come in and dine with you, your current seating capacity guidelines limit how many in-house meals you’re able to serve. When in doubt, err on the side of bolstering your takeout menu and offering items that travel and reheat well.
The experience of sitting down at a restaurant, ordering a favorite meal and enjoying the service is something so many people are craving right now. But for a lot of operators looking to reopen, the math doesn’t look workable – at least right now. The need to create extra space between tables, significantly reduce overall capacity and limit the kinds of in-person interactions that once helped define service will lead to a further reduction in previously slim margins. So what are operators – particularly those relying on full-service business – to do? Take the creativity you used to develop your business, menu, brand and service and channel it into reinvention. With so many small businesses trying to keep sales flowing, it’s a time when experimentation is needed and missteps are more easily forgiven. Depending on the flexibility of your space, whether you own or lease your property, what extent you can adjust your restaurant’s layout and hours, and the limits of your imagination, you may be able to make sweeping changes. Do you serve a popular seasoning, sauce, wine or other item that can be packaged and sold in a corner of the space you once used for seating? Can you open a small greenhouse in your parking lot and grow foods for sale – or even for your business use at a time when staples like lettuce can be difficult to source? If off-premise dining becomes the norm in the long term, can you restructure your space to accommodate a deli case full of sandwiches and salads to go or expanded catering options? At a minimum, take a close look at your menu to ensure you are maximizing your revenue while seating capacity is limited. People who enter the restaurant industry tend to have vision, learn on their feet, and carry on in the face of risk. It’s time to use all of those traits to your advantage.