Council Post: How Restaurant Brands Can Navigate The Dynamic Pandemic Marketplace

Roger David is the President/CEO of GSR Brands, the parent company of Gold Star Chili and Tom & Chee.

The Covid-19 pandemic has drastically altered the restaurant industry and what it means to “go out to eat.” What was once a merry staple in our social routines is now, at worst, considered a risky endeavor and, at best, an atmosphere stymied by the coronavirus threat. National safety guidelines, local health orders, personal health risks and personal comfort level factor into restaurant choice as much as the restaurant fare itself.

According to a Yelp economic impact report for the second quarter of 2020, as of July 10, more than 26,000 restaurants had closed due to Covid-19. Business Insider reported that by the end of 2020, as many as 85% of independent restaurants could close permanently because of the pandemic. As the second-largest private-sector employer in the U.S., few industries have been hit harder by Covid-19 than restaurants. Staffing is a top issue for many restaurants that are still in working order, as employment remains nearly 2.5 million jobs below the industry’s pre-coronavirus peak, according to a September analysis by the National Restaurant Association.

Anybody who has ever worked in the restaurant industry knows it is not for the weak or meek of heart. As the CEO of a restaurant brand, I’ve learned this lesson firsthand. Only those with mental toughness and tenacity make it in this industry. The pandemic has proven to be an adversary that has brought even the toughest and most tenacious of us to our knees.

So, how do you survive and even thrive in the restaurant world despite what seems like a no-win situation? Three things: Become an expert on the situation at hand, get and keep your off-premise machine well-oiled and, last but certainly not least, adapt to your consumer’s changing needs.

Become an expert on the situation at hand.

Right out of the gate, my team and I took a big step back to understand and decipher the data related to the pandemic — what was accurate and supported versus what was not. Luckily, there was a whole lot of data about the subject, readily available for free. We dug deep into what was available, verified sources against one another and were able to get a clearer look down the road.

Once we felt we had a decent understanding of the situation, we stayed on top of the information. It was our responsibility to know fact from conspiracy and to know which safety precautions were the most critical for protecting our employees and our guests.

While it seems a simple and obvious thing, I can’t say enough for how critical it is for restaurant brands to approach the situation as researchers and fact purveyors. Being well-read and informed of the situation can help you see and map a path through the chaos, and it enables a decisiveness and nimbleness that can help get you through the thick of it.

Get and keep your off-premise machine well-oiled.

Before Covid-19, “off-premise dining” (i.e., drive-thru, carryout, delivery) already had the industry’s attention because of its consistent upward trend. Just consider that more than 70% of casual-dining restaurants and more than 60% of family-dining and fast-casual restaurants saw an increase in delivery sales, according to the National Restaurant Association’s 2019 State of the Restaurant Industry report.

Since the shelter orders that shut down dining rooms for several months, off-premise numbers have soared. At one point, access to restaurants was all but cut off. The only way to enjoy your favorite restaurant was outside of the dining room. And for those consumers who did not feel safe eating in a dining room, off-premise became the alternative.

Over the past seven months, restaurants scrambled to get their off-premise game in order and regain lost pandemic sales. I’ve found that restaurants prepared for off-premise typically fared better than those that were unprepared.

Keep in mind that the off-premise trend isn’t going away any time soon, if ever. What was a competitive edge pre-pandemic is now the price of entry for all restaurants. It’s important for brands to adapt.

Adapt to your consumers’ changing needs.

Probably the biggest and most challenging challenge in this dynamic Covid-19 marketplace has been staying on top of and ahead of the changing needs of guests.

My restaurant brand’s success is built squarely on a service promise to make our guests “feel like family.” To stay true to that promise, putting guests’ needs front and center is an operational prerequisite. To do this yourself, listening to your guests as they express what they’re feeling and what they need. Pay attention to social media conversations about your brand and the industry to keep pace with changing wants and needs.

For example, we could see early on from social listening that face masks and other physical, tangible evidence of safety measures were quickly rising in importance to guests. So, instead of waiting for masks, gloves and safety measures of the like to be mandated by the health department, we made them a requirement early on. We had masks on every employee weeks before it was a mandate. That made our guests feel more secure and gave us a competitive advantage.

As the pandemic has rolled on, guests’ priorities around safety and health when eating out — whether in the dining room or to-go — have mutated at a rapid pace. This is only going to continue with the fits and starts that Covid-19 is sure to bring.

Consider it your responsibility and duty to stay on top of what your consumers need from you. I firmly believe that one of the most important things a restaurant must do in any environment — in particular one like this — is to pay attention to your guests’ needs, wants and desires and adapt accordingly.

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