July 2, 2020

During strong economic times, the restaurant business can be a challenging one. On average, food and labor costs generally account for about two-thirds of expenses. Rent and other costs of operations add another 25 to 30 percent. That leaves a profit margin somewhere in the range of 5 to 10 percent. But there’s a major caveat: restaurateurs only realize these profits if they are at least 80 percent capacity. And even with many states phasing in their reopenings, most cafes and dining establishments are far from these figures.

The pandemic threat has been rough on some industries and a blessing to others. For restaurants, it has clearly been the former. These businesses suffered weeks to months where onsite dining was prohibited. This was then followed by limited-capacity seating and safety precautions. And just when things looked to be improving, the pandemic threat in many states came roaring back. As a result, restaurants have been faced with some pretty tough decisions.

“We’re seeing restaurants come online. I think that the entrepreneurial spirit that you see with these folks is powerful. I think we underestimate individuals and the ability of these businesses to get back online.” – Dara Khosrowshahi, CEO of Uber/Uber Eats

Restaurant Delivery and Takeout – A Savior for Some

In order to survive, many restaurants have explored new opportunities during this time of crisis. Many, for example, have scrambled to shift their business toward restaurant delivery and takeout. For some, like Dominos and Chipotle, this was a piece of cake. But for many mom-and-pop restaurants, the conversion was more difficult. Not only did this require changes in staffing, suppliers, and workflows. It also involved deciding how to shift to restaurant delivery while promoting customer and staff safety.

Restaurant delivery may be the next evolution in dining thanks to the pandemic threat.

The pandemic threat forced many restaurants to take the easy route. These businesses arranged for restaurant delivery with GrubHub, DoorDash or UberEats. But consistently, owners complain about the high fees these food delivery services charge. Most of the time, such fees are 15 to 20 percent of the bill. With reduced revenues resulting from the pandemic threat, these costs are hard to swallow. Thus, restaurant delivery has been seen by many in the industry as a double-edged sword. This has persuaded some restaurants to forego delivery and simply offer takeout alone.

“The reality is not all of these restaurants are going to come back. Expectations are that as many as 30 to 40% [of independent restaurants] may not come back.” – Christopher Gaulke, Professor, Cornell University’s School of Hotel Administration.

Alternatives to Restaurant Delivery

For many in the industry, restaurant delivery is simply not enough to keep them afloat. Some restaurants had menu offerings before the pandemic threat that were not ideal for takeout. These restaurants had to either change their offerings or come up with other solutions. A few innovative businesses decided to shift gears and provide customers with a new option. They created meal kits and pre-made foods that could be completed in the safety and comfort of the home. Others chose to combine restaurant delivery and takeout with grocery delivery. Despite fewer or absent dine-in customers, these add-on services allowed some degree of financial normalcy.

Other restaurants refusing to pay high delivery fees have decided to ramp up their own online offerings. With the increased use of technology in the pandemic threat, many customers are starting to prefer online ordering options. The conveniences this offers consumers is readily appreciated. Beverages and meals are ready on arrival. And exposure risks are minimal especially if online sites allow payment in advance. Some restaurants, including Wolfgang Puck’s, expanded their online merchandise inventory as well during this pandemic threat. For some restaurants, this may also be an option for additional revenues.

“We try to adapt and do things in order to get another customer to buy our product. We are trying to use the Covid-19 crisis as an opportunity. Maybe one day we’ll build a ghost kitchen where we’ll just do takeout. We could actually develop a whole new business with that.” Wolfgang Puck, Founder and CEO of Wolfgang Puck Fine Dining Group

After the Pandemic Threat Subsides

The hope for all restaurants, as well as everyone for that matter, is that a coronavirus vaccine will soon be developed. The end of the pandemic threat would hopefully restore dining attendance. But even before COVID-19, restaurant delivery was on the rise. Many restaurants were already revamping their kitchens to service the consumer demand for restaurant delivery. Thus, making these moves now may not only allow immediate survival but long-term advantages as well. This is especially true if the virtual workplace becomes more of a norm.

Recent developments among restaurant delivery businesses support these possibilities. For example, JustEats recently purchased GrubHub for $7.3 billion. Currently, UberEats has reportedly offered to purchase Postmates for$2.6 billion. While these companies have seen recent boosts in restaurant delivery demand, they know the pandemic threat won’t last. It would thus appear they believe these trends will persist even after COVID-19 is better managed. These are changes worth noting for restaurants wishing to stick around for the future.

“We’ve got these well capitalized, multi-unit restaurant chains taking advantage of a situation where we’re about to see real estate become available. They’re going to be able to increase and grow their numbers fairly quickly.” – Christopher Gaulke

Trying Their Best to Make Lemonade

The fact of the matter is that some restaurants won’t survive the pandemic threat. Those struggling before will have the most difficulty weathering the storm. And even some that convert their operations to restaurant delivery, takeout, and more may be unable to make ends meet. Regardless, it’s important to see this pandemic threat as an opportunity for innovation. Being dynamic and adaptable is essential during these times in an effort for restaurants to thrive if not survive.

When it comes to COVID-19, each of us has had to face setbacks, inconveniences, and in some cases, major challenges. Quarantine, lockdown, and social isolation has created their own set of pressures as well. One of those pressures for many people has involved managing their weight effectively. Gyms have been closed, schedules disrupted, and a large percentage of people have been working at home. Together, these changes combine to make weight loss more difficult. If ever there was a need for a virtual weight loss app, the time would be now!

Before the pandemic, roughly 40 percent of all adults were obese. It’s unlikely that these figures have declined in the past few months. In fact, these rates have probably increased. The “Quarantine Fifteen,” “Pandemic Pounds,” or “Lockdown Load.” Weight gain during the pandemic goes by many names. But fortunately, several businesses now offer weight loss apps that go beyond traditional weight loss approaches. These virtual weight loss programs are more comprehensive in their strategies. And the benefits might be more profound as a result.

“Obesity is a chronic disease and there are factors at play, such as biology, genetics, hormones and environmental consequences. We are focused on understanding what the root cause is and helping people learn how their brain and gut are connected.” – Isabelle Kenyon, Founder and CEO, Calibrate

Virtual Weight Loss Considerations

Traditional weight loss programs assess your health, discuss weight loss goals, and then structure a plan accordingly. In essence, newer weight loss apps do the same. However, many of these virtual weight loss programs embrace a more holistic and comprehensive approach. Certainly, traditional programs considered exercise, caloric intake, and dietary health. But newer programs are including additional measures like proper sleep hygiene, social support, and personalized coaching and education. These are actually things that have become more feasible in virtual weight loss platforms.

For consumers fighting the ‘pandemic pounds’, virtual weight loss apps might do the trick.

Consumers have become more accustomed to videoconferencing, contactless menu scanning, and other digital techniques over the past few months. These skills actually reduce the barriers for many in using weight loss apps. In the “before,” these apps might have been viewed as a nice complement to traditional weight loss programs. But combined with more comprehensive tools, virtual weight loss tools are increasing rapidly in popularity. Depending on which tools best suit a customer, they may download one or several.

“Free tools allow you to track your food intake, which is a form of self-monitoring that’s been found helpful for reaching or maintaining a comfortable weight. They can also expose when you might be grazing or over-snacking, which happens when you’re spending more time working at home with a stocked kitchen.” – Samantha Cassetty, Principal at Samantha Cassetty Nutrition & Wellness, LLC

Businesses Offering Weight Loss Apps

Some weight loss apps are relatively new to the market while others have been around a while. But in each case, these virtual weight loss platforms keep expanding their offerings and tools. As a result, users can choose from a variety of these apps depending on their unique situation. And with personalized medicine becoming the norm, these apps fall in line with current trends. The following are some that are noteworthy in their personalized and holistic approach.

Lose It! – This weight loss app is liked by thousands because it is extremely user-friendly. Its virtual weight loss approach is to calculate your daily calorie needs based on your weight, age, and goals. It then creates a personalized weight loss plan for you to follow. Key features of Lose It! include a bar-code scanner capable of logging over 33 million foods’ nutritional information. It also has a “Snap It!” feature that determines portion sizes from a photo you take of your plate. And it also has a community sharing feature that boosts accountability and provides a forum for questions.

Calibrate – This New York-based startup recently received an additional $5.1 million in venture capital funding. And for good reason. Calibrate’s new weight loss app combined prescribed medication with personalized coaching to help people achieve their goals. Their holistic approach involves an initial screening survey, a doctor’s analysis, followed by a personal coach. The virtual weight loss program strives to achieve a 10 percent reduction in body weight over a full year. Though only available in 4 states currently, its funding will help it scale and expand in the near future.

Noom – This virtual weight loss program also begins by collecting a comprehensive health and lifestyle survey from users. Height, weight, gender, and weight loss goals are combined with this to tailor a specific plan for each individual. Noom’s weight loss app records your daily weight, physical activity, foods eaten, and even glucose levels. Plus, a virtual coach is available during working hours to users along with motivational readings and quizzes. Noom has increased significantly in popularity and now boasts over 3.5 million foods in its recording database.

WW – Previously Weight Watchers, WW is a commonly used weight loss app by millions. However, the company has greatly expanded its virtual weight loss programs recently. Completely digital programs now exist that records weight, diet and activity. WW also has weekly workshops, social networking supports, and 24/7 personalized coaching. Using a Smart Points system, individuals are assigned daily point totals they are allowed. Not only does WW have a proven record of success, but it also offers more than 8,000 recipes for users.

Choose One, Choose Many

Virtual weight loss programs are convenient, easily accessible, and mobile. Additionally, modern weight loss apps are more comprehensive in their approach and offer an array of tools for users. For this reason, customers are often using more than one of these health-focused apps. Depending on specific needs, more than one may help individuals attain their weight loss goals. While no one was planning on adding weight during lockdown, at least there’s a silver lining. Several innovative companies now offer much-improved virtual weight loss options. There’s little doubt these advances will change the weight loss industry for good.

Day: July 2, 2020

Something to Chew On – Pandemic Uncertainty Forcing Restaurants to Reinvent Themselves