The restaurant industry could lose $300 billion by the end of 2020

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Technomic has revised its guidance for the rest of 2020 and into 2021, according to A press release the firm sent this week. The reason for these new figures? You guessed it: the pandemic. Speaking in this week’s announcement, Joe Pawlak, chief executive of Technomic, said he expects a “continued decline” in restaurant sales for the rest of the year but “aggressive growth” in 2021. .

“Few industries have felt the repercussions of the COVID-19 pandemic quite like the restaurant business,” he wrote, adding that the restrictions (e.g. reduced capacity, no bar seating) “are taking their toll , especially in segments that rely on on-site consumption.”

In light of this, the company made revised forecasts based on the Best, Middle and Worst Case scenarios. While the bulk of those numbers are behind Technomic’s paywall, the company has released some telling facts based on the new forecast:

  • Based on the mid-case scenario, the restaurant industry will grow 21% in 2021, but sales will still be down 11% from 2019 sales.
  • The restaurant industry is expected to lose between $250 billion and nearly $300 billion in sales for 2020, depending on the scenario.
  • QSRs are currently the best of all restaurant types; restaurants and full-service bars are struggling the most.

The firm also notes that the state of the industry outlook is “directly linked to medical advances related to COVID-19” such as a vaccine.

It’s no secret that the spikes in COVID-19 cases are partly related to the reopening of state economies, of which restaurants are a major part. Again this week, the New York Times noted that “State and city data shows that many community coronavirus outbreaks this summer have been centered in restaurants and bars, often the largest settings for infecting Americans.” In a separate article he also noted that indoors, the six-foot rule for social distancing is misleading because “people think they’re protected indoors and they really aren’t.” No wonder, then, that CDC lists indoor dining as the most risky setting of any restaurant format for the spread of the virus. the virus spreads more easily in a restaurant that offers to eat in, even with a reduced table capacity, According to the CDC.

None of this is exactly an encouraging scenario that restaurants will face in the coming months. Even in a Best Case scenario, full recovery will be slow at best. As we move towards this prospect, companies are best advised to keep their foot on the gas when it comes to offering offsite formats.

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