This is the fourth story in a five-part series examining the long-term impact of the coronavirus pandemic on the restaurant industry.
The mass shutdown of restaurant dining rooms forced operators to rethink their menus, with some implementing changes they say will endure far beyond the current crisis. Takeout and delivery, once an afterthought for some, is now vital to their survival. Some are reconsidering the menu mix and how to optimize selection to boost razor-thin margins. Others are scrapping their shared-plates models and reimagining the future of catering.
As they struggle to stay in business during the pandemic, all operators are trying to figure out what the post-coronavirus customer will want to eat, spend and expect on restaurant menus.
Shunning shareables and rethinking price points
Although social distancing mandates will gradually be lifted sometime in the future, sharing food may still turn off diners spooked by the pandemic. As owner of Kush Hospitality, Matthew Kuscher operates eight different full-service concepts in Miami. The menu at The Spillover, a casual surf and turf restaurant, included many shareables, but “when we reopen, we are remodeling the menu to the appetizer-entree-dessert format, focusing more on salads, sandwiches and entrees,” says Kuscher. “We are also thinking of doing $12 lunch specials from Monday to Friday. I’m not sure customers will casually choose a $15 burger in the future.”
A few of the Kush Hospitality restaurants have pivoted quickly to takeout, and since the bar menu is key to the dine-in experience, they are offering premixed cocktails and craft beers to go. “We’re selling a decent amount, plus we have a higher quality of beer than you can get in the stores,” says Kuscher.
The rapid expansion of restaurant alcohol delivery started as an experiment, as operators scrambled to find alternate revenue streams when COVID-19 closed dining rooms. Regulations were temporarily loosened in more than half of states, and the experiment seems to be going well from both a government and operator viewpoint. Anecdotally, some industry forecasters predict that the relaxed rules may become permanent in some form, although the laws vary widely from state to state.
Kuscher says that even if alcohol delivery laws become stricter again, it’s possible to continue this experiment. “We may sell our bar’s premeasured mixers and fruits in a kit, along with a recipe, and guests can add their own spirits.”
Family dinners fill a need
Molly McGrath, culinary director and chef of Roti Modern Mediterranean, is taking a cue from current consumer behavior to tweak the menu. She launched family meal boxes for takeout and delivery, and they’ve turned out to be good sellers. “We always hoped to strengthen our dinner business,” says McGrath, “and these have been a good way to introduce families and kids to Roti.” The fast casual specializes in rice plates with a choice of sauces, toppings and proteins, and families are enjoying mixing and matching and tasting a little of everything, she says.
While most of Roti’s 42 units are in business districts and busy at lunch, the nine that are currently operating are in residential neighborhoods where housebound consumers are looking for family dinners to go. “I’m hoping to sustain and grow the dinner business now that I see it catching on,” says McGrath.
With Roti’s dine-in model, guests must line up to order, and even if they stand apart at a safe distance, the space can get crowded. Before the stores closed, McGrath began curating menu items at one location to eliminate the decision paralysis that comes with customization and holds up the line. Depending on projections, she thinks those chef-created plates can be applied to more locations. And she’s looking at more sanitary individual fork dispensers for the front of house.
“I’m hoping to sustain and grow the dinner business now that I see it catching on.” —Molly McGrath, Roti
Upgraded delivery packaging
Kyle Welch, CEO of limited-service Epic Burger in Chicago, is also reevaluating disposables, particularly with the rise in delivery. Even before COVID-19 hit, he upgraded and integrated the chain’s technology to ramp up delivery. “Our goal is for takeout and delivery to account for over 50% of revenue, and the health crisis is expediting the process,” he says. Four of its eight locations are now doing a robust to-go business, Epic’s mobile app goes live in two weeks, and even when stores reopen for dine-in, the focus for the future will be takeout and delivery.
Toward that end, Welch is looking at new packaging for burgers and fries—the core of Epic’s menu and items that don’t particularly travel well. Consumers are going to want sealed, tamper-proof packaging, but to retain the quality of the product, tightly sealed plastic doesn’t cut it. “We’re looking at ventilated plastic bags that release the steam without sacrificing safety or sustainability,” he says.
Streamlining menus and inventory
Welch has also been thinking a lot about waste during the shutdown and is planning on cutting back on inventory and creating menu items that cross-utilize more ingredients. “We’ll rely on data, look at the product mix and determine what customers are ordering, then cut down SKUs,” he says.
Jason Valentine, CEO of Zoup Eatery, is also “doubling down on our core products” and “speeding up menu development around that niche,” he says. The company’s broths are the base for grain bowls, broth bowls and soups—comfort foods that are currently doing well with takeout and delivery customers isolating at home. The broths also sell well on the retail side, and Valentine expects to expand varieties offered on grocery shelves. “This helps leverage the brand for Zoup Eatery,” he says. Branded packaged foods also create an alternate revenue stream.
Catering, which makes up 10% to 20% of Zoup’s business, will also evolve differently, he predicts. “No more lunches where 20 people gather around and help themselves from large serving dishes,” Valentine says. Zoup is planning to develop more boxed lunches and individual soups to boost business catering sales and meet stricter safety standards and customers’ new expectations.
“We all work on very thin margins, and very few restaurants have money saved for crises like this.” —Sujan Sarkar, Rooh
Finding operational workarounds to survive
Rooh, an upscale Indian restaurant with locations in Chicago and San Francisco, is also doing takeout for the first time, in Chicago only. “We’re surviving; doing better day by day,” says chef-owner Sujan Sarkar. In fact, he wants to continue takeout, offering customers the same menu items as sit-down customers but at a 25% reduction in price.
The dine-in experience at Rooh is all about attentive service, beautiful presentation, chef-inspired modern Indian cuisine and signature craft cocktails. Sarkar doesn’t intend to skimp on any of those attributes, but the shutdown has given him time to think about future cost- effective measures. “We all work on very thin margins,” he says, “and very few restaurants have money saved for crises like this.”
He has several ideas for cutting costs without sacrificing quality or the experience. For example, revamping the menu with less-complicated dishes to involve fewer of the kitchen staff in the preparation. Another idea: have guests preorder their dinner online, so the kitchen will know how much to prepare and minimize waste.
The way the menu is currently set up, there are a couple of starters to share, small plates and large plates. Diners often share the large plates, but that won’t be as appealing in the future. “I may do all small plates, so people can try their own two dishes and maybe a dessert,” says Sarkar.
And as an alternative to Rooh’s tasting menu, which involves multiple items, many trips to the kitchen for the server and increased labor, “I’m thinking of arranging a tasting menu of sorts on Indian thali platters. That way, customers can experience many flavors and menu items in one serving, designed just for them,” says Sarkar. “How we serve the menu is going to impact margins in the future.”
How the coronavirus will change the restaurant industry
Tuesday: Will mom and pops survive this?
Today: How the coronavirus will change menus
Thursday: With survival on the line, expect restaurants to plan for the impossible