Published on: Mar 22, 2021 by Nicole Gralapp, CPA, CExP™
Updated on: October 31, 2024
While the COVID-filled year of 2020 is behind us, COVID hasn't gone anywhere. Thankfully as more vaccines are administered, we can hopefully get back to a new "normal." For the restaurant industry, that will mean changes in how things used to be, which will require restaurant owners to look at innovative ideas and trends to help them adapt in 2021.
There are many ways to change how your restaurant does business. Here are just a few to help you prepare for a successful future.
Many restaurants and diners have been making changes to their menus due to COVID. In most cases, the number of menu items offered to customers has been reduced.
Benefits: Reducing the number of menu items should reduce the number of different food items you need to carry on hand, reducing food costs and waste. This reduced menu may also allow you to work with less staff during these challenging times as the kitchen can focus on making a smaller selection of dishes.
Tip: Try looking at foods that can be utilized in several ways. This allows you to keep less ingredients on hand, lessening food spoilage and cost. You will be surprised at the different ways some foods can be prepared. You can also use this opportunity to show your creativity in the kitchen.
With the onset of COVID, many restaurants and bars were forced to close their doors to in-person dining. Unfortunately, a good number of these establishments had to close their doors permanently. For those that survived (and are surviving), takeout and delivery services have saved the day. You can be sure that post-COVID, more people will utilize off-premises services to be on the safe side.
To utilize these services to their utmost, it is imperative that you have an online ordering option for your business. Create a website (or have one created) with pictures of your meals and the ability to place orders online, and you will be set moving forward.
Benefit: By offering takeout and delivery options or optimizing your current services, you will open your business up to more customers and increase business and brand exposure.
Tip: When offering online payment options, make sure your website is secure to provide your customers a safe transaction. A breach of your customers' data will NOT help your business.
When states and municipalities began closing businesses for indoor dining, one of the first things restaurants started doing was utilizing outdoor spaces. Some establishments were even using sidewalks or working with city officials to block off parts of slower side streets for tables, trying to find ways to get customers to come and dine. COVID has pushed many consumers to use curbside takeout, delivery, or other contactless forms to get their food. This leaves some food establishments with many unused internal and external spaces (e.g., parking lot).
Look for ways to transform some of your parking areas into outdoor dining or redesign part of your indoor dining into open-air spaces. Remember that this is not a year-round option for many states, especially during the winter months. So plan accordingly.
Benefit: Some customers tend to feel safer eating outdoors, so providing an open-air option can help bring these people to your tables. You either paid or are paying for the property, so you might as well use as much as you can to help generate revenue!
Tip: If you serve alcohol, make sure to check with your state and local laws regarding serving alcohol outdoors. A fence or gate around your outdoor dining section may be required.
Only fast-food chains offer meal deals, right? Not necessarily. This trend has been increasing as families are looking for deals when dining out, especially in these COVID times when many people are suffering financially.
Look at creating meal deals for couples and families by combining appetizer, entrée, dessert, and drink in package deals at slightly reduced prices. If you're not interested in creating various deals and changing up your menu or website, start with 1 or 2 meal deals and see how they sell. You may be surprised at the result.
Benefit: These deals may lead to an increase in sales. If you find them successful, use them for promotional purposes, especially during times of slower customer traffic.
Tip: Try a few different variations of the meal deals: some with or without appetizer or dessert, different number of people they can feed, etc.
More consumers are starting to purchase meal kits, mostly online at this point. This allows them to create meals at home without dealing with all the preparation. The question is:
Why can't restaurants sell meal kits to their customers?
Most people try to recreate a meal from their favorite restaurant and, most of the time, it just doesn't taste the same. Why not create meal kits for your more popular, easy-to-make at-home entrees and provide the exact ingredients you use to make it themselves. Just don't forget to provide cooking instructions!
Benefits: As with takeout and delivery, meal kits will allow you to reach a new customer demographic: people who like to cook and like their favorite restaurant. Give them the restaurant experience of creating a restaurant-caliber dish at home.
Tip: If you have signature dishes that utilize super-secret ingredients or a secret sauce of some sort, make sure you don't give the secret away! Provide these items pre-made so they don't learn your secrets. Also, don't forget to provide a list of ingredients so those with food allergies know what is in the meal.
Who would have thought the word "subscriptions" would make its way into the restaurant industry? Well, it has. Meal subscriptions are a rising trend with restaurants, where customers pay a monthly fee to get meals each month for takeout or delivery.
Benefit: Subscriptions are like fixed income, so the more you can sign up, the better. With more people using off-premises services, offering this service should be a revenue generator. Some infrastructure would be needed to manage the subscription part but it should be relatively easy to implement.
Tip: As these subscriptions would be set revenue each month, offer them a lower price to increase subscription sign-ups.
With the onset of COVID, many states and local municipalities have relaxed their laws regarding selling alcoholic beverages for takeout and delivery orders. Most laws require the alcohol to be in its original packaging (no mixed drinks).
Benefit: Additional sales is the obvious benefit, and this adds another selling point for customers to come to your restaurant.
Tip: Do your due diligence and make sure you have all the required permits to sell alcohol to go, as well as making sure you know what hours you can offer this service. Permits and times differ from state to state.
Roughly a third of consumers prefer dining establishments that offer comfort foods such as burgers, pizza, soups, sandwiches, and the like. The same percentage of people prefer dining at restaurants that offer healthier foods. The remaining third choose something in between.
Benefit: According to the statistics, you can make two-thirds of the consumers happy by offering a few comfort food items and healthy food options. Not too bad of a ratio.
Tip: While you want to offer foods that appease the most people, you need to balance the number of meal offerings and keep your food costs manageable.
Most of these trends and ideas are not earth-shattering, but they make sense. In the COVID and post-COVID world, many of these will be necessary for dining establishments to adopt for their business to survive.
As restaurant owners, your primary focus is the customer, and rightly so. If you find that you would like to implement some of the ideas above but don't know where to start or don't have the time to do what is needed, reach out to SVA Certified Public Accountants and let our industry experts see how they can help you.
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Nicole is a Principal at SVA Certified Public Accountants working primarily with closely-held businesses and individual clients. Nicole performs a variety of tax, assurance and business consulting functions. She provides clients with technical expertise in areas such as tax planning, financial reporting, financial projections, budgeting, financial and estate planning and review of internal controls. Her experience in the hospitality, restaurant, construction and professional services industries gives her the ability to consult with clients in a variety of areas.
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