Impact Report May 29, 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, May 29th:


Traffic for all regions (US, Europe, Asia and Middle East/Africa) improved slightly or maintained similar performance as the prior week. In the US, the holiday weekend did not have a big impact – either negatively or positively. YOY traffic maintained previous week’s levels of negative 15%. In Asia, we continue to see improvement. YOY traffic inched closer to negative 20-25%, up from nearly 30% last week. Europe also saw traffic increases; however, they still lag behind their global counterparts, with traffic stagnating at negative 30-40% YOY.

For the US: 

QSR continues to outperform TSR in both traffic and sales.

  • Overall QSR traffic has remained similar to the prior week at 15 to 20% YOY declines; sales are continuing to show positive to neutral trends, at 0-5% YOY. Performance continues to be driven by drive-thru, where traffic is increasing by 15 to 20% YOY; sales are up 50-60%.

TSR improved this week to 50 to 60% declines YOY for both traffic and sales instead of the 60-70% we have seen in prior weeks.

  • Subtle traffic improvements have primarily been driven by delivery and to go meals, where traffic is up 80 to 90% YOY and sales are up 100%. Dine-in traffic continues to improve by another 5-10ppt this week.

Chicken continued to win out with sales and traffic numbers staying about the same as the prior week, though competitive brands focused on other categories (burgers, pizza) are performing better week to week with 5ppt gains in both traffic and sales as of 5/29.


  • Mountain, East South Central and West South Central divisions continue to perform best with positive YOY sales of up to 25% and YOY traffic declines of 10 to 15%.
  • Coastal divisions (Pacific, New England, Middle Atlantic) continue to perform the worst with traffic declines of 15 to 20% YOY. Sales are showing positive YOY growth (0 to 25%).

For Europe:In the second week of reopening for countries such as Germany, Austria and Spain, traffic continues to stay negative with declines of 30-40% YOY. Sales were slightly better this week, with declines of 20-30% YOY as compared to negative 25-35% last week.

For Asia: YOY overall traffic remains diminished, but is showing continued signs of improvement. This week, we saw declines of approximately 20 to 30% YOY as compared to 30-35% last week. Most restaurants can only provide delivery, take-out or drive thru services; dine-in options (or “lobbies” as this service is called in Asia) remain closed.

For Middle East/Africa: With the Ramadan season ending, YOY traffic has steadily increased from the low point of 75% declines YOY to pre-Ramadan numbers of negative 40-50%.


Share of QSR and Pizza Delivery

For another consecutive week, trends show a continued rebound in market share for those businesses most affected by quarantine closures (Table Service/Fast Casual/Family Dining). As expected, the sectors that were most successful during the pandemic were QSR and Pizza sectors which in most cases, continued operations while other segments were forced to close. In fact, pizza brands such as Domino’s and Papa John’s have reported that sales have been “accelerating” despite the pandemic.

Now, as customers look to add variety and as restaurants are allowed to operate at greater capacity, table service restaurants are seeing slight improvements.

Greater Strain on Booking and Contactless Payment Systems

With guidelines limiting capacity and social distance requirements likely here to stay, reservation and waitlist systems are increasingly important to ensure health and wellness of guests and manage peak hours. Reservations have also begun to show up in areas where they were never used before including retail shopping and other leisure activities. Combined, this may represent a change in consumer expectation and behavior as they return to the market.

Mobile payment, which prior to COVID was seen as more of a convenience, might also play a key role in health and wellness implementations. Although some guests are reticent about mobile payments due to security breaches, attitudes may be changing. According to a survey conducted by the Strawhecker Group and the Electronic Transactions Association , small businesses in the US have already seen a 27% increase in customers using mobile payment services. Implementation of cashless systems in Europe, which has been historically behind US and Asia in overall adoption, has accelerated due to the pandemic.

Pricing Activity

Further Insight on Potential Product Inflation

Recent updates from the Bureau of Labor Statistics regarding Food Away from Home (FAFH) paint a picture of potential commodity inflation that consumers may feel in the upcoming months. Guidance is up on almost all categories with particularly large adjustments to the Meat and Egg sectors. Overall revised guidance shows a projected inflation of up to 3%.

Not All Needs the Same

Although almost all operators have been negatively affected by the COVID crisis, other factors such as commodity inflation, labor increases and unique regional criteria may result in a different “need set” across organizations. As a result, brands may need to design localized pricing strategies (and increments) that address differing headwinds. It will be important to be transparent and communicate any variations to guests, including the industry hurdles causing price increases. The right communication will play an important role in how well increases are received once they are in market.

Industry Strategy

The “Chicken Wars”

Poultry items have been an area of strength both leading into and through the COVID crisis. Concepts are adding chicken menu items or promotions in order to “cash in,” elevating the humble QSR chicken sandwich to the centerpiece of menu strategy.

But will it last? As meat shortages continue, we may see the field open up for plant-based foods. Pre-COVID, plant-based items were already entering the QSR market as its popularity increased. But now that the pandemic has disrupted the US meat supply chain, this might be an opportunity for popular brands like Impossible Foods and Beyond Meat to gain further market share.

Take Away Cocktails

Early on in unit closures, innovative leaders found ways to vend alcohol as part of curbside service , helped along by changing regulations. This continues to be an area to boost add-on sales for take-away meal purchases. In particular, the introduction of larger, shareable cocktails have helped add needed revenue to take out and delivery orders in the face of declining transactions.

Family Meal Items

Another previously noted and popular menu addition, family meals, continues to grow across many menus and multiple service styles. These items have provided a good opportunity to raise average check during quarantine, but even with markets now reopening, family meals are finding a permanent place on delivery/carryout menus.

Menu Strategy

Change is Constant

As we enter a “new normal”, operators are encountering a new type of guest with new habits, new expectations and new ways of getting to your restaurant. So what tools can you use to maintain the customer-centric, flexible response needed in today’s ever-changing environment? RMS spoke to fast-casual brand, PDQ, about the brand’s approach to business in this new environment, key learnings and how data is shaping their decisions. Read about the brand’s proactive approach to evolving their menu since the start of COVID-19, which led to a 40% growth in drive-thru sales since the start of shelter-in-place orders.

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.