Apr 30, 2020 - Economy & Business

Restaurants gingerly test how to return amid coronavirus

Kim Hart, author of Cities

Tables are marked off at J. Christopher's restaurant that now offers dine-in service in Decatur, Georgia. Photo by Jessica McGowan/Getty Images

As restaurants in some areas begin reopening their doors, their performance will provide a first big test of Americans' readiness to resume life outside their homes.

Why it matters: Restaurants play a major role in just about every downtown core, shopping district and office hub. But that doesn't mean people will be ready to slide into a booth right away.

Driving the news: Florida Gov. Ron DeSantis yesterday announced restaurants can reopen on Monday at 25% indoor seating capacity.

  • Texas Gov. Greg Abbott announced that restaurants can reopen Friday at 25% capacity, along with retail shops, malls and movie theaters — but not all restaurant owners are ready to invite patrons into their dining rooms.
  • In Georgia, restaurants were allowed to reopen this week with restrictions, such as limits on dine-in customers and mandatory mask-wearing.
  • Tennessee restaurants are now allowed to be open at 50% capacity.
  • Colorado is easing its stay-at-home order but will still restrict restaurants to takeout and delivery.

By the numbers: Restaurants employ about 15.6 million workers, per the Bureau of Labor Statistics — and the industry saw its largest employment drop on record when restaurants suddenly closed last month, according to the National Restaurant Association.

What's happening: Restaurants known for delivery and take-out have weathered the coronavirus downturn better than those that, up until a month ago, were focused on dine-in business, per Yelp.

  • Restaurants using order-ahead and take-out apps will continue to get consumer spending.
  • In China, restaurants that leveraged order-ahead and delivery apps came back faster — and consumers were more likely to adopt these apps than before the coronavirus lockdown, according to Katherine Fogertey, restaurant research analyst at Goldman Sachs Global Investment Research.

What to watch: "Consumers are going to be on the hunt for value," said Fogertey in a recent Goldman Sachs webinar — which means that fast food joints and low-priced eateries will recover fastest.

  • For dine-in restaurants, the first phase will include sneeze guards around booths and the removal of tables to increase physical distance between diners.
  • Corporate dining and high-end restaurants will come back even more slowly.
  • Restaurants in malls, stadiums and tourist hubs are likely to be the last to come back.
  • Local chains, especially those that source their food from local farms, will be more trusted by consumers early on in the recovery.

What's next: All restaurants will be incentivized to increase cleanliness standards, per Yelp's data science editor Carl Bialik.

  • He also expects greater use of reservations and wait-lists so people can avoid the busiest times for dining and better control their interaction with restaurants.


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