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Industry Trends June 26, 2020

We’ve experienced a generation-changing disruption of the Food and Beverage Industry landscape with the COVID-19 pandemic.

Throughout it all, we’ve been supporting our clients to make the best decisions for their brand under these unprecedented circumstances. Now, as countries start to reopen, we are being asked new questions about how to adjust to the ever-changing environment. To help guide our clients this week, we have collected the following information for your consideration as of Friday, June 26th:


YOY traffic trends for the US improve slightly again while Europe, Asia and Middle East/Africa see declines.

In the US, traffic figures are trending slightly upwards again from the prior week, with YOY traffic at negative 10 to 15%. In Asia, we see a slight decline in YOY traffic, which is trending at negative 25% YOY. In the Middle East/Africa numbers continued to drop to declines of 30% to 35% YOY. Europe’s traffic trends remain between negative 35 to 40% YOY.

For the US: 


  • QSR traffic regained positive momentum, though still down 10 to 15% YOY. Sales also increased from last week and show a neutral-positive YOY change of 0-5%.
    • The performance of QSR is still mainly driven by drive-thru, which has seen a slight decline in both sales and traffic over the past two weeks. Traffic is trending at 15-20% growth YOY and sales are at 35-40% growth YOY. This is compared to early June when sales were up as much as 50% to 60% YOY.
    • Dine-in continues to lag in this segment, however, it continues to trend positive since the reopening of dining rooms in various regional areas.
  • TSR continues to lag behind QSR, however, we are seeing vast improvements as more restaurants open dining rooms. YOY traffic and sales both rose another 5ppt this week; moving them closer to negative 35-40% range for both metrics.
    • YOY traffic and sales metrics for ‘delivery’ and ‘to go’ increased by 5-10 ppt, with both metrics showing growth of above 100% YOY, respectively. ‘Dine In’ sales and traffic also improved by 5-10 ppt, though still down 55-65% YOY.

By Daypart

  • Lunch and dinner continue to lead. Traffic overall is down 10-15% YOY and sales are neutral-positive between 0 and 10% YOY.
  • Breakfast YOY traffic is trending at declines of 20-30% and YOY sales declines of 5-10%.
  • Late night continues to lag other dayparts. For the segment traffic is down 20-30% YOY and sales down 10-20% YOY.

By Food Category

  • Chicken continues to lead other categories with YOY traffic between 0% and negative 5%. Sales are trending positive with YOY growth of 15-20%.


  • Mountain, East South Central and West South Central divisions continue to outperform other regions. Sales remain positive 0-10% YOY. Traffic remains down by 10 to 15% YOY.
  • Coastal divisions (Pacific, New England, Middle Atlantic) continue to see the most negative impact. Traffic remains at negative 15 to 20% YOY and sales are negative to neutral – between -5 and +5% YOY.

For Europe: Many European countries started to reopen for dine-in customers over the past month, and the UK plans to reopen July 4. However, YOY trends continue to hover at previous weeks’ levels, with traffic fixed at negative 35% to 40% and YOY sales trending at negative 15% to 25% YOY. This is a combination of lack of foreign demand, some independent restaurants still being closed and residents still working from home.

For Asia: Traffic slowed down this week, sinking to 25% to 30% YOY, compared to declines of 20-25% last week. Dine-in options (or “lobbies” as this service is called in Asia) are now available again in Japan, South Korea, Taiwan, Thailand, Indonesia, Philippines and Singapore.

For Middle East/Africa: Traffic continued a slowing trend started last week. Both traffic and sales are down 30 to 35% YOY.


Slow Growth for Casual Dining

In a continuing theme, the return to normal business has been slow and highly regional for casual dining. Any gains seen in regions that reopened earlier may be lost if states require a second shutdown, and some restaurants are already “reclosing” their dining rooms as a preventive measure. Others have had to temporarily shut down due to employees testing positive.

Sustained Delivery

Delivery continues to carve a larger niche in normal restaurant operations even during post-COVID re-opening phases. This may represent a permanent change to revenue centers. In our recent customer survey of 1,200 US consumers, all limited contact channels experienced an increase in May as compared to April, and customers may start considering at-home dining as part of their overall restaurant experience.

Third-Party Channel Growth

Third-party delivery services continue to see impressive year over year growth in sales and use, according to Sense360 latest insights. Overall growth has sustained through April and May, suggesting restaurant operations need to be prepared to cover third-party costs for the long-term, adding to price pressures.

Pricing Activity

Cheese Prices Reach New Highs

Drastic changes in usage since the start of the pandemic have commodity prices on a roller coaster, and cheese is now at the top. A block of cheddar cheese on the Chicago Mercantile Exchange jumped from a dollar a pound in mid-April, when suppliers were offloading product usually purchased by institutions to the export market, to $2.585 on June 9, as demand from both restaurants and consumers increased. The 160% jump in the cost of cheese is already visible to consumers in grocery stores and will add to continued price pressure on restaurants.

Continued Bracing for Higher Menu Prices

Labor cost increases, commodity cost spikes, and additional overhead due to health and safety procedures have set the stage for potential price increases. That might be okay with customers, according to our May survey of 1,200 US consumers. When asked if they believe restaurant prices will increase, 79% of respondents responded yes. Nearly half (43%) of those respondents thought prices would increase by 10% or more.

Industry Strategy

Cook at Home Menu Items

Meal Kits and “partially prepared items” continue to find a place on menus past re-opening, likely due to the sustained demand for limited contact channels and possibly the desire of guests to support their favorite local restaurants.

QR Code to the Table

Digital menus continue to be a trend post re-opening, particularly QR codes that offer easy and contactless access to menu items. Perhaps the most creative use of QR codes comes from The Buffet at Wynn, the first all-you-can-eat restaurant to reopen in Las Vegas, on June 18. Instead of bellying up to the buffet, guests are seated and greeted by a server. Coasters with QR codes outline an extensive menu of over 90 items, guests make their choice and the server brings their meal to the table. The buffet style might be gone, but all you can eat remains – guests can reorder unlimited items within a two-hour period.

Focus on Kids & Fun

Families are both slower to return to dining rooms and more likely to use delivery, so kid-focused promotions have potential to attract attention and increase overall check size. In our recent phone interviews with families around the world, moms (and some dads) shared that “giving kids a choice and themselves a break” were the main reasons for dining out pre- and post-COVID. They also expressed that a welcoming atmosphere was important pre-COVID. Finding ways to extend the brand promise beyond the four walls and deliver choice and value through limited contact will remain important to attract the segment.

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.

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