INDUSTRY VIEW
Food & Beverage
Bakery • Café • Catering • Dine-in • Fast Food • Grocery • Market • Takeout
THE NEW NORMAL
What Has Changed?
1
Hygiene Standards
Customers are concerned that eating out will increase their likelihood of getting infected by the coronavirus.
2
Crowd Control
Safety concerns and ongoing restrictions for crowd control will continue to reduce the volume of dine-in customers.
3
Habit Change
Customers will likely continue to choose grocery over takeout and will continue to spend more time at home even after restrictions lift.
4
Consumer Trust
Restaurants post-coronavirus will be more intimate and centered around the community.
5
Ethical Eating
Consumers consider ethical eating options for the long run with community impact and loyalty at the forefront of dining decisions.
6
Heavy Revenue Loss
Survey results revealed an average drop in revenue of about -63% due to COVID-19. Food and Beverage businesses already operate on slim margins and fear that further stay-home mandate extensions could cause permanent closure.
7
Drastic Model Pivots
Most businesses were forced to temporarily shut down or pivot to pickup, takeout, online and home delivery to sustain revenue, models that were only a fraction (if any) of revenues.
8
Supply Chain Blocks
Businesses are experiencing increased costs, delays, and shortages in key food ingredients such as dairy, eggs, and meat, and are turning to local alternatives to mitigate the risk.
9
Growing Partnerships
Businesses in this sector demonstrated a high tendency to partner with firms in the same industry and competitors. This can help leverage the customer base and distribution system of other businesses, and bring different products to new customers.
RECOMMENDATIONS
How Should I Recover?
PHASE 1
Onset
Go online
- Pivot the small business online by using available, low-cost options such as Instagram Business.
- Look for COVID-19 related initiatives to help food and beverage industries, such as Catch22 Delivery,in Seattle, WA, a free online platform designed to raise awareness and showcase the products and websites of food and beverage businesses. No fees are charged, so it can help keep employees working and get the word out for the business' website and online delivery options without paying high third-party fees.
- Search for online farmer’s markets in the area to help sell products. Kitsap Fresh, in Poulsbo, WA, for instance, allows a business to sell and buy foods on this website.
- Sign up for online local food markets. Fresh Food Revolution, a cooperative of local farmers and value-added food producers, has enabled their tenants to increase sales during the pandemic as customers turn to online shopping while staying at home.
Try creative delivery ideas
- Deliver food in bundles with other products. Try some with a fun or useful factor, such as a meal with a unique branded face mask to distinguish products—this idea was inspired by a business providing toilet paper roll with meal purchase.
- Package products as meal kits. Customers can purchase refrigerated or frozen foods and reheat them to eat at home.
- Offer food subscriptions. Consumers can pre-order ahead of time and set a predetermined pickup location and time. This can enable the business to have a source of steady income.
- Consider wholesaling food to local markets, groceries, and other sellers.
- Consider offering temporary personal catering services to homes and businesses.
Focus on customer engagement, acquisition, and brand awareness
- Ensure frequent and consistent online engagement to draw customers and keep them engaged. Post content about the company’s goals, initiatives, community impact and feature products and services on platforms such as Instagram, Facebook or Youtube Live.
- Try Question and Answer sessions, tutorials, themed live streams, giveaways, and collaborations with other businesses and guests from the local community.
- Start a TikTok or social media challenge on Instagram or Facebook.
- Better understand the demographics of your customers by collecting who they are (email or Instagram signup) and what channel they use (walk-ups, mobile orders, website, etc.) and load into a Customer Relationship Management (CRM) tool (e.g. Hubspot, Salesforce, or simply a spreadsheet).
- Offer online cooking classes and demonstrations.
- Create recipe books that include the company’s signature dish recipes.
PHASE 2
Oscillation
Create a safe space and follow social distancing requirements
- Learn what the experience was like for businesses in states that have already reopened (Tampa Bay, Houston).
- Move tables at least six feet apart.
- Tape down social distancing lines on the floors.
- Require employees and encourage customers to wear Personal Protective Equipment (PPE) such as face masks.
- Consider single-use menus, tablecloths, and condiments.
- Sanitize stations frequently.
- Require staff to do temperature checks and health screenings before clocking in.
- Consider conducting temperature checks for customers upon entry.
- Install interior structures to prevent infection, such as glass partitions between booths and cashiers.
- Use a doorbell to avoid crowd gathering at the entrance.
- Keep a customer log for 30 days to facilitate contact tracing.
- Encourage drive throughs, delivery, and curb-side pickups.
- Limit party sizes and occupancy.
- Avoid self-serve stations.
- Minimize the number of staff interacting with each table.
- Taking advantage of a newly-launched economic recovery plan that temporarily allows restaurants to expand their outdoor seating into areas that otherwise would be considered public rights-of-way, like sidewalks or alleys, as well as privately owned parking facilities.
Adapt menu selections
- Offer foods that were shown to improve health and the immune system.
- Analyze high margin items in your menu and reduce low margin items that are harder to source.
- Evaluate key ingredients affected by supply chain sources and consider altering the menu for ingredients that are in stock instead.
Collaborate with other businesses
- Collaborate with other food and beverage businesses to share space, products, delivery options, community initiatives and events.
- Launch joint efforts with other businesses to get involved. Help healthcare workers by supplying lunch and other necessities and share the good news on social media to help in COVID-19 relief efforts.
- Partner with businesses in the supply chain to acquire certain ingredients at special bargains.
- Share information with other food and beverage businesses and the supply chain as a short-term strategy for survival.
Market what you’re doing
- Ensure customers know what efforts being taken to make them safe and well and post signs where appropriate.
- Describe on your menus.
- Post information on your website and social.
- Write an article for a local newspaper or blog.
- Offer creative promotional campaigns. For example, Cucina Deli in Utah tied free coffee promotions to the Dow Jones Industrial index.
PHASE 3
Opening
Pivot to other business models
- Become a supplier, wholesaler, or distributer.
- Try catering and weekly delivery to businesses and homes.
- Consider becoming an online-only business.
- Sell boxes and packaged goods to grocery stores and markets.
Partner with business and hospitals long-term
- Offer local companies lunch boxes and happy hour deliveries on a weekly basis.
- Provide convenient, nutritious meals to local hospitals and healthcare facilities regularly.
Start a delivery-only virtual kitchen
- Find shared-use kitchens or commercial kitchens that rent by the hour, day or month to multiple tenants to reduce operational costs (e.g. The Kitchen Door).
Adapt the space
- Restructure space to share with other tenants or move into a new space.
- Try “smart space planning” by staggering operating times among different restaurant tenants (e.g. Bakery A in the morning, Café B in the evening), or Consider combining forces and sharing restaurant spaces with other local restaurants in the area. See how Scramblers and Andoro's Pizzeria combined in 2008 recession.
Case Studies
Success Stories
Heart of Dinner
How Kopitiam NYC developed Heart of Dinner to provide elderly Asian communities in Chinatown during the pandemic.
SEE FULL STORY
Jubilee Farms
Jubilee Farms’ subscription box model, allows customers to commit to buying produce from local farmers
SEE FULL STORY
Piroshky Piroshky: Catch 22
Seattle Pike Place’s Piroshky Piroshky launched Catch22, an online delivery platform for small businesses.
SEE FULL STORYTechnology
Tools to Adapt
Mobile Payment Systems
Offer options to order and pay by phone. Square Pay enables customers to pay and tip via phone and processes credit cards, gift cards and cash. Other platforms include PayPal and Stripe.
Voice-Activated Ordering System
Try embedding new technology into the business’ ordering system by establishing voice-activated features. These are compatible with many home artificial intelligence devices such as Amazon’s Alexa and Google Home.
Kiosk Ordering
Consider installing a kiosk for ordering. By reducing staff-to-customer contact, risk of infection may decrease, and can free up time to work on other tasks for existing employees. See how The Italian Place is building their kiosk strategy.
Useful Industry Resources
Find More Ways to Help You
Dining Bond
Consider joining Dining Bond. A team of restaurant industry veterans created a campaign called Dining Bonds. These bonds work just like savings bonds, where guests can purchase a bond at a value rate today, to be redeemed for full face value in the future. For instance, a bond for $100 will sell for $75 and be redeemed for full value on or after the predetermined redemption date, often about 30 – 60 days after purchase.
Toast Restaurant
Try installing Toast, a Point-of-Sale and Management System. The company eliminated all software fees for the customer community in light of COVID-19 related efforts, and provides customers with free access to digital ordering, marketing, and gift card programs for three months. Toast released a COVID-19 Resource Center, an educational resources hub for the restaurant community, updated in real-time with new content, best practices, information, and events. The page provides five-chapter online classes to help small businesses weather the pandemic.
Frontline Foods
Try joining Frontline Foods, a united effort among volunteers to support local restaurants that have been impacted by shelter-in-place measures and provide meals to healthcare workers on the frontlines of the pandemic. Restaurants prepare meals for healthcare workers using money given to them through donations from the community.
Rally for Restaurants
Rally for Restaurants is a grassroots initiative launched by restaurant technology providers, businesses, restaurant owners and workers, and volunteers to support local restaurants to order takeout, buy gift cards, and raise political awareness to support food and beverage businesses during the crisis.
CDC Guidelines on Reopening Restaurants and Bars
This document outlines the minimum requirements that must be in place in order to reopen. It includes general considerations, health and safety procedures, as well as ongoing monitoring guidelines.
Washington Phase 2 Restaurant/Tavern Reopening Guidelines
This document outlines the requirements that businesses in this industry must take to reopen during Phase 2 in Washington. It outlines physical considerations as well as employee safety and health procedures.
SCORE Action Plan
SCORE released an action plan tailored for restaurants.