2021 Restaurant Industry Trends
While the hurdles of 2020 may not end when the clock strikes midnight on December 31st, the restaurant landscape is better equipped to deal with whatever comes its way. The industry and its many players have experimented, failed, succeeded, but most importantly, gained a tremendous amount of knowledge this year. Significant shifts have occurred and while some are only temporary, others are here to stay. The novel coronavirus is no longer so “novel.” After nine months of adapting to a new normal, here is our restaurant industry outlook for 2021:
1. Shift to In-House Delivery
The start of the pandemic saw restaurants scrambling to expand or, in some cases, set up a delivery service. The lack of time to pivot from mainly indoor dining to virtually only delivery and takeout meant that most restaurants outsourced delivery to third parties, such as DoorDash, Uber, and Postmates. However, up to 70% of consumers prefer to order directly from restaurants and cut out the middleman. They’re not alone. Restaurants have found the lack of control that comes from outsourcing delivery coupled with high fees troublesome. Although not always economically feasible, those restaurants which can afford it are looking to make the switch to in-house delivery.
2. Ghost Kitchens Will Likely be Short-Lived
The past year saw the rise of ghost kitchens as a way to operate with lower overhead and labor costs. There has been much speculation as to whether this trend will continue, but it is unlikely. A mixture of concerns, including the importance of authenticity to millennial consumers again coupled with the high fees that come with outsourcing delivery, may spell out the fall of most ghost kitchens.
3. Transformation of Dining Rooms
The pandemic caused a major shift from indoor dining to outdoors. Heavy restrictions and consumer fears have made the traditional indoor dining experience a thing of the past. While restrictions have been eased or lifted in many places, indoor dining will not return to the cherished pre-pandemic experience it was for quite some time. With winter approaching, those restaurants located in areas where indoor dining is permitted will still need to get creative and modify their dining rooms to ensure the safety and security of patrons. As part of our 2021 industry outlook, we foresee flexible seating and modified dining remaining part of the industry trends for the foreseeable future.
4. Increased Safety and Sanitation
While the downsides are numerous, some pandemic-induced changes have their upside. Sanitation and cleanliness have become paramount, even more so than in the past. It is likely that those restaurants which can afford to go above and beyond in ensuring the safety of their guests will be rewarded. Installing advanced air filtration systemsand continuing expanded sanitation measures will make wary patrons feel more comfortable, increasing the likelihood that they will resume indoor dining as soon as possible.
5. Downsizing
Downsizing is a trend likely to continue into 2021. Many restaurants have found that they can operate just as well, if not better, in a smaller space and with a simplified menu. Downsizing in both menu items and real estate is likely to be prevalent in the industry. By focusing on customer favorites and seamless delivery and curbside options, fast-casual restaurants are poised to thrive in the upcoming year.
Takeaways for the 2021 Industry Outlook
While uncertainty remains, the forecast is promising for the restaurant industry. Moody’s Analytics predicts a 15% increase in profits for the industry next year. This is definitely a bright spot in the restaurant industry outlook for 2021. We are firm believers that with strife, comes opportunity. We operate in an industry that is nothing if not innovative. By embracing change and seizing opportunities, the restaurant industry can forge ahead into a brighter year ahead.
Unsure about how to streamline your business and embrace these changes? Contact TRG and let us help you set your business up for success!
