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State of Restaurant Industry Report 2021 reveals impact of pandemic

Consumers want to return to restaurant dining rooms but embrace takeout business during health crisis

The 2021 State of the Restaurant Industry Report, prepared by the National Restaurant Association, became available today. The report reflects industry practices and advances in technology, off-premises businesses and prime costs in restaurants. This year, with the poignant challenges of the coronavirus on the industry, the report’s measurement of the pandemic’s impact is timely and critical.

Restaurant industry sales totaled $659B, a loss of $240B on the original, pre-pandemic projection of 2021 sales. In addition, more than 110,000 eating and drinking places closed temporarily or were shuttered for good, based on data available as of December 1. The State of the Restaurant Industry Report incorporates a survey of 6,000 restaurant operators and important trends in consumer behavior, as revealed by a survey of 1,000 adults.

“While we still have a long way to go, we are confident in the resilience of the industry’s workforce, operators, suppliers, and diners,” said Tom Bené, president and chief executive of the National Restaurant Association. “The year ahead will be critical as we continue to advocate for much-needed recovery funds to help get our industry back on track. Working together as one, I am confident in our ability to continue safely serving our guests and supporting our communities.”

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Consumers drive significant off-premises demand

Technology adoption by consumers and by restaurants has accelerated during the pandemic. Consumers are embracing takeout: delivery and carryout orders are part of the new normal. Sixty-eight percent of consumers say they are more likely to purchase takeout from a restaurant than before the health crisis. A total of 53 percent of consumers say that carryout and delivery is “essential to the way they live.”

Consumers are increasingly becoming more aware of the economic impact of the coronavirus on restaurants. Sixty-four percent of delivery customers prefer to order directly from restaurants, while 18 percent prefer to order through a third-party service. Moreover, 72 percent of adults say it’s important their delivery orders come from a location that they can actually visit in person—as opposed to a virtual kitchen space.

Technology a critical tool in adapting to pandemic

Eighty-eight percent of consumers and Millennials say they enjoy going to restaurants, so they’ll return to dining rooms. In the meantime, technology is playing a big part in the way that restaurants can gin up sales during the pandemic. Half of fine-dining and casual-dining restaurants have invested more in technology, while 39 percent of quick-service restaurants have likewise invested more.

Ghost kitchens, whether cloud or dark, are on the rise and reflect another advancement as apps and online ordering platforms facilitate customers ordering from any location. As an example, a growing cadre of technology companies, including United Kitchen and Reef Kitchens, continue to set up remote, fully-equipped cloud kitchens that can accommodate to-go only business. Nonetheless, only five percent of restaurant operators have added service from a ghost kitchen thus far, notes the State of the Restaurant Industry report.

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The pandemic has also put a spotlight on contactless ordering and payments. Forty-percent of restaurant operators have implemented such technology during the health crisis. Diners appear willing to consider this when making decisions about dining on-premises. About one-fifth of them would factor these options into their dining choice.

To learn more about the State of the Restaurant Industry Report, navigate here.

Photo credit: Louis Hansel (featured preview image)

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