Nearly one out of every eight full-service chain restaurants that were open before the pandemic remain closed, according to the latest report from Black Box Intelligence.
The numbers suggest that the coronavirus has had potentially lasting damage on casual- and family-dining chains, even as some concepts have recovered while fast-food chains largely thrive on drive-thru and delivery orders.
The consulting firm said this week that 12% of full-service chain locations open before the pandemic remain closed, a level that has been flat for the past four weeks. By comparison, Black Box said, 7% of limited-service chain restaurants remain closed five months into the pandemic.
Other data suggest that the industry has a long way to go before it can recover from the pandemic. Newly released federal retail sales data, for instance, said restaurant sales rose 5% last month from June’s numbers, but remain 19% below their levels from a year ago.
Even a substantial rebound next year could keep the industry well below its pre-coronavirus results.
Restaurant Business sister company Technomic this week said that it expects industry sales to rise 21% next year, based on its middle-case scenario of a recovery. Yet that would still result in sales 11% below where they were in 2019.
Full-service chain closures align with the total number of restaurants expected to close by the end of next year, about 15% of total locations.
Same-store sales were down 15% in July, while traffic was down nearly 20% as consumers went in less often but made larger orders when they did. The consulting firm noted in its most recent report that “the pace of improvement suggests it will take a long time to” get to a full recovery. Black Box noted that improvement last week from the prior week was “almost negligible.”
While many chains have seen sales recovery, or even growth, a lot of chains have shuttered locations. Potbelly is planning to close 50 restaurants. Chains such as Chuck E. Cheese and California Pizza Kitchen are in bankruptcy, while Ruby Tuesday has closed numerous restaurants.
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