Impact Report April 10, 2020

The current COVID-19 pandemic has quickly and dramatically redefined the food and beverage industry landscape.

One of the most common questions we are receiving is “how is the industry responding and what are they doing to adjust” either at the overall or local level.  Although responses are changing by the day (if not by the hour), we have collected the following information for your consideration as of Friday, April 10th:


The negative traffic trends in the US and Europe seem to have stabilized at last week’s numbers. Across Asia, though, YOY traffic is more negative due to the latest social distancing restrictions put in place by several governments to fight a second wave of infections.

For the US: overall QSR negative YOY trends seems to have hit bottom and are leveling out around -30-45% with coastal regions more affected. Table service has similarly seemed to level around -70-80%.

We’ve also observed the following micro-trends:

  • Delivery sales primarily increased YOY during the ‘late night’ periods (10PM thru 6AM)
  • Drive Thru during Breakfast is down but holding steady
  • Drive Thru during Lunch and Dinner were among the bright spots

For Europe: The overall traffic decline seems to have hit its lowest point in many countries, with strict social distancing guidelines imposed. Nonetheless, there is light at the tunnel. Some brands in Italy, Spain and Denmark are starting to open restaurants again in areas with lower infections.

For Asia: the decline in YOY overall traffic is increasing between -15% to -25% due to newly introduced restrictions, but the numbers are less negative than in the rest of the world, mainly due to the fact that brands had already established in-house delivery and take out channels.


“Leaner Restaurants” as a necessity

Even during recovery, brands may be facing potentially depressed traffic, so brands should be looking at strategic ways to further refine their models, in order to do more with less. Examples may include a new menu that allows for a smaller staff.

Suggested reading: “The Coronavirus Crisis Will Change Culinary Education; Here’s How” (Forbes)

Slow Growth during the Recovery Phase

Cautious travelers and restriction removal occurring at different times may dampen the recovery phase for a number of segments in the food and beverage industry. Combined with a potential decrease in spending from economic hardships, recovery may be challenging even as Stay at Home Orders are relaxed.

Suggested reading: “How high will unemployment in America go?” (The Economist)

Pricing Activity

The Alcohol Effect

Loosened restrictions on selling alcohol have given many restaurants, particularly fine dining, an add-on opportunity for food orders. Some operators are even targeting wine collectors by including higher-end selections, offered at discounted prices, to help move products out.

Suggested reading: “Restaurants Are Selling Their Trophy Bottles to Make it Through the Pandemic” (Eater) 

Industry Strategy

Value Focus

Most brands are focusing on value/deals promotions, especially if they can leverage social media, their apps or their email clubs to promote them.

Many operators are incenting consumers to order through company websites instead of third-party sites by offering free delivery and deeper discounts.

Combo deals, BOGO and free kids’ meals have seen heavy use. Couponing for free items with purchase (desserts/apps) is also prevalent.


An emphasis on food safety and cleanliness has emerged. For example, Domino’s and Papa John’s are advertising a “no touch” process, where boxes are sealed after product leaves the oven.

Advertising focus has shifted to delivery boxes and families eating “remotely,” with some messages changed to highlight “comfort food.”

Some of our clients have seen a shift to customers having larger meals so leftovers can be eaten the next day.

Breakfast is a category that seems to suffer.

Giving Back

A bright spot is the sense that we’re all in this together, and there are many ways restaurateurs are giving back to each other and the community.

#TheGreatAmericanTakeout on March 24 generated awareness (about 50,000 social media posts according to Nation’s Restaurant News, donations and traffic). On March 31, the industry expanded the effort to a weekly promotion called #TakeoutTuesday.

Starbucks implemented a $3 pay raise for all working employees during the coronavirus crisis.

Chefs have cooked and delivered free meals to kids. Others are using their restaurant kitchens to help feed restaurant employees who have been laid off due to the coronavirus, while others give away excess food to food banks and charities.

For every meal ordered from its ordering website, U.S.-based Just Salad will donate a meal to public school partners who are trying to keep kids fed during this difficult time.

Dig Food Group, with restaurants in New York, Boston and Philadelphia, started a program called Dig Feeds that matches each online delivery order with a meal donated to a local hospital, school or shelter. The initiative donated more than 50,000 pounds of food in its first week.

Menu Strategy

Groups have adjusted menus to:

  • Assure fast and consistent execution of items so they can expedite pick-up and drive-through times
  • Create consistent products with less staff, adjusting for high cost and potential stock limitations
  • Limit/reduce available options to increase operational efficiency

So far, no supply chain shortages have been observed in the U.S.

Some brands are creating menus to be deployed only in highly affected areas, driven by available staff.

We realize these are stressful and unprecedented times. RMS is here for you. Reach out to us today if you are looking for practical recovery strategies designed to optimize menu profitability, sales and financial profitability that can be implemented by operators immediately.

Let’s start your recovery strategy

Now, more than ever, RMS is committed to doing all we can to support the restaurant industry. Our team of experts is ready to help put you on a path toward profitability.