Weekly Update: Coronavirus & The Foodservice Industry, Week 46

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Stats Of The Week

The State Of The Industry

According to the NRA’s 2021 State of the Restaurant Industry Report, the association estimates foodservice sales will increase by 11% in 2021 to $731 billion. Though the restaurant industry is expected to grow in 2021, it will still come in about 15% below 2019 sales. In 2020, foodservice industry sales were down approximately 24% to $659 billion compared to $864 billion in 2019. Bars and taverns were down the most in sales of any segment with 65% followed by full-service sales decreased by 30%. The NRA’s report states that there is still pent-up demand for dining out. They suggest restaurants focus on catering to diners that are visiting establishments for both on- and off-premise occasions rather than trying to appeal to all customers.

Survey Estimates When Life Will Return To Normal

A new report from HealthCare Insider gauged when consumers believe normalcy will return through 10 activities, including not wearing a mask in public, family gatherings, and dining indoors. 21% of consumers expect life to return to normal in the summer, while 18% believe normalcy will return in the fall. Of those surveyed, 20% think life won’t return as usual until 2022 or later and 13% believe things will never be normal again. The report also found that comfort levels around dining indoors vary by demographic. Men are 40% more likely than women to feel comfortable dining indoors by the spring. Millennials are nearly 30% more likely than baby boomers to feel comfortable dining indoors. It has been shown that where you live also affects your level of comfortability with indoor dining. Consumers in the Midwest (29%) and South (27%) are more likely than people in the Northeast (25%) or West (22%) to say they already feel comfortable dining indoors.

What’s Trending

California Resumes Outdoor Dining

On January 25, California Governor Gavin Newsom announced that the state will be ending all stay-at-home orders and the most severe business restrictions will be lifted. For restaurants, this means outdoor dining will be possible across the state. Regional stay-at-home orders that affected most of the state were announced on December 3 as availability for ICU beds dropped below 15%. As a result, restaurants could only offer take out and delivery services for the past few weeks. Now, ICU capacity in every region in the state is at 15% or higher, which has put an end to those orders including the curfew that banned non-essential activity between 10 p.m. and 5 a.m. According to a report from The Los Angeles Times, LA officials indicated that they would move to allow outdoor dining later in the week.

NY Gov Announces 2021 Restaurant Relief Program, But Is It Enough?

New York Governor Andrew Cuomo has outlined relief measures for the restaurant industry as a part of his 2021-2022 budget proposal. The budget includes a $130 million pandemic recovery and restoration program, which allocates $50 million for restaurants to rehire staff. Restaurants can apply for a $5,000 tax credit for each worker they rehire with a maximum of 10 workers for a total of $50,000, according to New York Upstate. Though the state has not released eligibility criteria, the funds are geared towards small businesses, and affected businesses will have to show they’ve lost at least 40% of revenue to apply.

Critics argue that though this assistance could help a number of restaurants, it isn’t enough to support businesses and suggest opening indoor dining as a better solution. New York City has closed dining rooms since December while most of the state is allowed to offer indoor dining. Eater also reports these restaurant funds are contingent upon New York receiving $15 billion from President Biden’s administration. If the state does not receive that assistance from the federal government, the restaurant recovery program will be excluded from the budget.

Companies List Incentives For COVID-19 Vaccines

With restaurant workers deemed as ‘essential workers’, operators are beginning to prepare their staff for eligibility in the next few weeks, following healthcare workers and elders. Darden Restaurants Inc., which owns restaurants such as Olive Garden and LongHorn Steakhouse, is going to offer their hourly workers up to four hours of pay as an incentive to get both COVID-19 vaccines when they become available. The parent to more than 1,800 casual-dining brands will compensate workers two hours of pay for each dose of the vaccine they receive, Gene Lee, Darden CEO and chairman, wrote in a memo to team members. Darden noted that the pay rate will be based on the team member’s total earnings, including tips, over the most recent 13 weeks with a maximum pay rate of $20.

“The COVID-19 vaccine will be a critical tool in helping end this pandemic, which will allow us to welcome more guests and team members back into our restaurants. We recognize getting vaccinated is a personal decision that you alone can make. While we will not require hourly team members to be vaccinated as a condition of employment, we strongly encourage you to consider getting vaccinated,” Lee wrote to employees.

Chipotle’s 1st Super Bowl Ad Highlights Farmers

Chipotle Mexican Grill will make its debut spot in a Super Bowl commercial on February 7. The commercial titled, “Can a Burrito Change the World?”, showcases the effect of Chipotle’s “Food with Integrity” standards to help cut carbon emissions, save water, and support local growers. On Super Bowl Sunday, Chipotle will waive delivery fees on orders through the Chipotle app and website. With each order made on those platforms and through third-party delivery services, the chain will donate $1 to the National Young Farmers Coalition, an advocacy group that promotes independent family farms. In a statement, Chipotle CMO Chris Brandt called the chain’s first Super Bowl appearance a milestone moment for the brand.

"We want to use this massive platform to help shift attention toward creating positive change for the challenges our food system faces and educate consumers on how they can make a difference," Brandt said in a statement.

Dunkin’ Adds Unexpected Menu Items To Target To-Go Customers

Dunkin’ has partnered with Chicago-based Farmer’s Fridge to test out menu items which include Greek salads, burrito bowls, pesto pasta, Greek yogurt, and chia seed pudding in six restaurants, according to Food & Wine. Three of the test restaurants are in Chicago and the other three are in New Jersey. The test will last three months and highlight Dunkin’s focus on creating items for on-the-go and lunch. These new menu items come more than two years after Dunkin’ dropped “Donuts” from its name to rebrand and expand both food and beverage offerings. In a statement emailed to Food & Wine, a Dunkin’ representative wrote that the test is designed to gather feedback from customers, franchisees, and employers to inform future decisions. They also state that the chain is committed to delivering a wide variety of delicious, convenient menu choices to keep their guests running all day long.

Bright Spots In A COVID-19 World

Chefs Come Together To Host Virtual Fundraiser

Harrisburg University and the Hilton Hotel have teamed up to host the “Just A Taste - The Great Pennsylvania Cooking Show”. The show will consist of renowned Pennsylvania chefs coming together to help struggling bars and restaurants during the pandemic. The fundraiser will be held virtually and streamed live with guest appearances from local chefs and Roy Choi, co-host of the popular Netflix series, “The Chef”. He will be sharing his talent from California and will participate in a question and answer session during the show. All donations will be going to the Pennsylvania Restaurant and Lodging Association’s hospitality assistance program.

“The hospitality industry is hurting desperately and financial support from the government is lacking, leaving hundreds of businesses and thousands of employees without a safety net. We are grateful to the organizers of ‘Just a Taste’ for contributing event proceeds to HARP so we can continue providing relief to frontline hospitality workers who have been impacted by COVID-19, through no fault of their own,” John Longstreet, President & CEO of the PRLA, said to Local 21 news.

Super Bowl Sunday Gets SOUPier

For the last 15 years, Heritage Baptist Church in Annapolis, MD has raised funds for the local homeless shelter through soup. The event was held every Super Bowl Sunday with signature soup recipes from local restaurants that were popular with customers. With COVID-19 discouraging large gatherings and sharing foods, the fundraiser is going virtual this year. Event Spokesperson Lea Hurt wrote in an email to the Capital Gazette that though everyone can’t gather around and raise money for the shelter, they can’t break the 15-year streak. For a week, Heritage Baptist will host a SOUPer Bowl event on their Facebook page with daily content including featuring soup recipes. 100% of the funds donated will go to the Light House Homeless Prevention Center. Over the years, the fundraiser has raised over $30,000 for the shelter.

Quote Of Hope

“Restaurants are the cornerstone of our communities, and our research shows a clear consumer desire to enjoy restaurants on-premises more than they have been able to during the pandemic.” - Hudson Riehle, senior vice president of the research and knowledge group at the National Restaurant Association

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