It’s been a year since the pandemic upended restaurant dining in the United States, and plenty of people have more questions than answers. When will things get better? When can we safely go to a bar? When can we see our friends again? Will our favourite restaurants survive?
A recent estimation from the National Restaurant Association found that 17 percent, or 110,000, U.S. restaurants have closed, either permanently or for a prolonged period of time since March 2020. It’s a sobering statistic as we face several more months of pandemic living, even with the promise of a successful vaccine rollout in our future.
Over the past year, restaurant technology companies like Yelp and OpenTable have been collecting data from restaurant customers to help explain how restaurants are faring in tough times. Their numbers paint a picture that’s slightly less grim, and perhaps hint at the types of restaurants that could fare well in the near future.
Instead of tracking closures, Yelp’s 2020 Economic Average Annual Report, released in January, tracked new business openings. The data showed that during the last three months of the year, new openings were nearly on track with 2019 — they were down just 4 percent. According to Yelp’s data, 68,975 restaurants opened last year.
Yelp’s data also shows that plenty of businesses reopened after shutting down temporarily. A majority of restaurants that reopened during the last year did so only once — just over 40,000. A much smaller amount — fewer than 5,000, according to a visual representation of the data — reopened twice, or even three times.
Toast, a restaurant point of sale and payments system, also collected data from restaurants to illustrate the changing restaurant landscape. It’s updated in near real time and broken down to a state level. Since January, revenue at Toast’s restaurants has been down between 23 and 53 percent. That dramatic 53 percent dip came on New Year’s Day, with a notable 42 percent drop on 1 February, the date of last year’s Super Bowl.
A comparison of dine-in and off-premises options shows that in-restaurant dining accounts for the majority of revenue this year, between 68 and 53 percent of revenue, depending on the day. In fact, in-restaurant dining has made up the majority of revenue for these restaurants since late May; previously off-premises options made up the majority of revenue since 18 March.
OpenTable, a reservations provider for nearly 60,000 restaurants worldwide, set up a ‘State of the Industry’ dashboard last year to track trends across a portion of its restaurants. As of 10 February, about 75 percent of restaurants in the U.S. were accepting reservations from diners. Restaurants that are open for dining in the U.S. are seating between 45 and 70 percent of the diners that they were at this time last year, with one notable exception: on Valentine’s Day, restaurants in the U.S. seated almost the same amount of diners as last year — 92.5 percent of last year’s total. Of course, even with this year’s Valentine’s Day lift, U.S. restaurant reservations were way down — numbers have been in the red since 8 March.
So what’s working right now? Yelp attributes some of its good news to “the innovative ways business owners moved their operations outside during the milder months and prioritised opening less traditional food services – such as farmers markets and food trucks”. In fact, at the end of the year, new openings were up at certain types of food businesses, including food trucks and bakeries.
According to Toast’s data, quick service restaurants have fared slightly better than full service. But the most successful restaurants on its platform are adopting the most tech. A business that uses online ordering, digital gift cards, loyalty programs, and Toast’s marketing platform has 30 percent higher revenue year over year than its peers who don’t take advantage of the company’s full suite of products (restaurants that use any three out of four see 25 percent higher revenue, according to the company).
It’s good proof of concept for Toast, which makes its money by selling software to restaurants, but also an indication that good technology can boost a restaurant’s bottom line, especially in a pandemic.
Latest
