These numbers follow those from Black Box Intelligence, which found same-store sales growth at restaurants at -10.3 percent, a 3.8 percentage drop from October’s year-over-year sales growth rate.
Payments company TableSafe just released data that found transaction volumes at full-service restaurants declined to 50 percent of pre-pandemic levels in November after recovering 60 percent of pre-pandemic levels in October. But his half-joking, half-serious comment also serves as a reminder and a call to action to the entire industry to keep on innovating, even - nay, especially - amid the uncertainty that has defined the restaurant biz in 2020.ĭata :Full-Service Restaurants Are Still Flailing When It Comes to SalesĪpparently it was the week for new data on just how badly the restaurant industry is struggling right now, especially when it comes to full-service restaurants. Quote of the day goes to Lunchbox’s Nabeel Alamgir, who said, “The best thing you can ever do is just do what Domino’s did-invest in it 20 or 30 years before everyone else did.” Of course, he quickly followed up with some actionable advice about delivery and ghost kitchens. Technologically speaking, this is very expensive, but numerous companies exist that help power the back end of native storefronts without demanding 30 percent of each transaction. A good deal of marketing and communication has to go into this process, not to mention investing in actually building out that direct channel. After a restaurant has attracted an initial following on a third-party marketplace, the big challenge is converting repeat customers to one’s own website and getting them to place orders there. However, restaurants absolutely must invest in their own native delivery platforms. Others said restaurants need third-party delivery services in the initial stages of an off-premises/ghost kitchen strategy because of the visibility these services are able to provide via their online marketplaces. Some went as far as to say the industry would have been decimated over the last nine months without them. More than one panelist felt that, despite high commission fees, restaurants need third-party delivery services right now. Third-party delivery: Love it or hate it, we still need it.
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As restaurants plan for off-premises orders and virtual brands, they should consider the infrastructure assets they already have as an important factor in determining how to approach the ghost kitchen question. For example, if you are running a virtual brand out of an unused part of your own kitchen, you’re not paying for additional electricity, staff, or equipment. The benefit of this route, versus renting space for a commissary, is that restaurants can leverage fixed costs that are already there. From extra space in existing restaurant kitchens to hotel facilities to coffeeshops not open during dinner time, plenty of kitchen infrastructure already exists for restaurants to turn into a ghost or dark kitchen operation. There is a lot of under-utilized kitchen space out there. Even when it’s safe to dine inside a restaurant again, those new behaviors will continue driving the industry towards the off-premises model. Huge numbers of consumers have found new ways to interact with food via online channels. Many of the developments in recent months have been in reaction to the pandemic, but the ensuing focus on ghost kitchens, delivery, and virtual restaurants will stay long after vaccines have been administered. Ghost kitchens and virtual restaurants are here to stay. To top that off, here are a few more noteworthy points raised by event panelists and attendees throughout the day: Last week, I covered a couple of the major points made at the event around building a virtual restaurant brand and the risks of relying on a 100-percent delivery-only operation.
You can subscribe to our newsletter here to get this delivered to your inbox.Īnd now for some final thoughts on The Spoon’s ghost kitchen event, which we held this past Wednesday.įor the (virtual) event, we gathered restaurant operators, tech companies, ghost kitchen infrastructure providers, and thought leaders together to discuss not just the promise ghost kitchens hold for restaurants, but also the realities those businesses must face when using this model. It’s our weekend restaurant tech news wrapup.
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