The 2020 COVID-19 pandemic and its echoing effects have heavily impacted the restaurant industry, and as a result it continues to experience many restrictions. Indoor dining closures, staff shortages and the supply chain are ongoing issues, especially as the Delta and Omicron variants continue to spread. The restaurant industry lost $240 billion in profits in 2020, and in 2021 is projected to fall about $167.5 billion short of pre-pandemic levels, showing that a return to normalcy is not quite yet in reach.
With new problems come opportunities for new innovations, and technology has been a vital resource for restaurants during the pandemic. Restaurants that incorporated digital solutions such as contactless ordering and delivery have been able to continue safely serving customers despite closures and shortages. From 2019 to 2021, the number of customers using food delivery apps rose by 21 percent, and this number is expected to grow another 22 percent by 2023.
Technology has helped restaurants survive the pandemic, but it has also become a regular part of the dining experience for millions of customers. While some operators have been hesitant to invest in technology, they must reflect on the past two years. To grow and sustain business, every restaurant needs to be able to quickly adapt to a changing world. Restaurants large and small must adopt digital solutions in the next year to maximize their profit potential and evolve with the ever-changing state of the industry.
Restaurants Must Prepare For Continued Disruptions
The setbacks restaurants have faced will continue to impact them into 2022. The staffing crisis is sure to continue, but many restaurants are not currently positioned to address its root causes. The top three reasons ex-restaurant workers gave for entering a different industry were higher pay elsewhere, a need for consistent schedule/income and lack of professional development and promotion opportunities. All three reasons tie back to dissatisfaction with wages, but restaurants may struggle with addressing this, as 86 percent of operators are reporting lower income than before the pandemic.
Restaurant operators are understandably concerned about the ramifications of staffing shortages. Longer wait times can create unhappy patrons and/or prevent customers from coming in altogether. Even for restaurants that are well-staffed, the Delta and Omicron variants have proven to be concerning, and a number of customers will continue to prefer delivery and pick-up options for the foreseeable future. Additional shutdowns and/or indoor dining restrictions may also be unavoidable in certain areas of the country. Restaurant operations need a boost to address all of these issues, and technology can provide that support.
How Tech Solutions Address Shortages and Increase Revenue
Investing in technology now will not only help restaurant operators address today’s issues, but diversify their business’s revenue streams for years to come. This year, 91 percent of restaurants implemented or planned to implement kitchen automation technology such as digital ticket systems. Limited staffing during the pandemic has shown operators how technology can streamline front- and back-of-house operations, providing much-needed support for even the smallest shift teams. The benefits provided by in-house tech will persist beyond the pandemic, helping to reduce errors and increase efficiency.
Restaurants must also focus on customer-facing technology and digital marketing. Customers have become accustomed to using digital touchpoints as part of their restaurant experience — from looking online to decide where to eat, to using websites to order and their phones to pay. Nine out of 10 customers research a restaurant online before deciding to dine there, so building a strong online presence is key to attracting customers. There are a number of digital solutions operators can implement to bring customers in from the web, such as online reservations, which 54 percent of guests say is the most important technology feature for them. Contactless digital solutions, such as QR codes to access menus and make payments, not only create a safer environment inside restaurants, but free up time for staff to focus on other tasks while still providing excellent service.
For smaller restaurants that have yet to bring in technology solutions like those mentioned above, the most important tech investment they can implement now is to create a presence on food delivery apps. Doing so will help increase revenue while effectively managing shortages. Delivery apps are a two-in-one marketing and sales platform, as users can peruse menus and build an order directly on their phones. While third-party apps are popular, the majority of diners — two out of three — prefer ordering directly from a restaurant’s own mobile app or website. Operators can cut out the delivery middleman and own their online ordering platforms, which creates great opportunities to reward new and loyal customers who order through the app.
Technology has helped thousands of restaurants survive unexpected shutdowns and shortages since the beginning of 2020. Operators who have yet to incorporate technology into their business model must consider the ways that tech not only fills in the gaps during times of need, but how it has set a new standard for both operations and customer expectations. Technology is a key driver behind the most efficient restaurants and high customer satisfaction. As we continue to navigate ongoing industry issues, restaurants that embrace technological solutions will continue to survive, and thrive, throughout 2022.