Jun 26, 2020 - Economy

Fast food catapults to the future

Illustration: Sarah Grillo/Axios

The coronavirus pandemic has accelerated trends in the fast food, giving franchises that stayed open a new leg up over their dine-in competition.

Why it matters: Social distancing was a seismic event for customer behavior prompting rapid changes from some American classics.

The big picture: Drive-through and advance ordering have higher margins for restaurants, with a side benefit of luring more customers, the WSJ reports.

  • "Franchisees can reduce labor costs by operating stores without the usual dine-in service."
  • "While urban locations are suffering, suburban stores with drive-through service are seeing massive increase in demand."
  • Starbucks is planning to build more locations in urban areas designed specifically for takeout and advance ordering."

Efficiency plays a big role...

  • Chains are reducing menu options, closing dining rooms and offering better deals.
  • McDonald's has cut 25 seconds off its average drive-through wait time, its CEO said last week.

Between the lines: This is also a moment when other food chains, including grocery stores, are looking to chip away at the power of delivery services.

  • Kroger and Albertsons are among the grocers that are willing to do the shopping for customers, with no fees for pickup.

The bottom line: Necessity and competition have spurred a solid 5 years or more of innovation in about 4 months.

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