Fast food restaurants respond to changes in consumer tastes during the coronavirus pandemic in ways that have increased profits in some chains to where they were before the health crisis or even higher.
Some restaurants focus on expanding their takeout and drive-through business, while others are betting on delivery services amid the recent surge in infections and changing regulations in the US. And many expect this effort to pay long-term because the pandemic shows no signs of fading and some consumer habits can change permanently.
Many fast food chains reduce staffing and cleaning costs by closing their dining rooms, and are in no hurry to reopen them. “For fast food restaurants, they don’t want to reopen their dining room because this lowers profitability and increases costs,” said Andrew Charles, an analyst at the investment bank
Burger King brand owners, Tim Hortons and Popeyes of Louisiana Kitchen, are redoubling existing efforts to improve digital offer and delivery services.
“Covid acts as an accelerator for several trends that we have identified in our strategy,” said Matthew Dunnigan, RBI chief financial officer.
The Canadian-US fast food chain relied on its digital sales channels when the pandemic struck, Dunnigan said. The RBI is extending pickup, drive-through and curbside delivery services, he said.
The company now has nearly 10,000 outlets offering shipping in the US and Canada, compared to several hundred in early 2018. RBI added more than 2,000 stores to its shipping network in the first months of the pandemic and boosted investment in its cellphones. application, said Mr. Dunnigan. He declined to give figures for the initiative, but said RBI investment in digital sales channels in recent years was huge.
Church’s Chicken, an Atlanta-based fast food operator specializing in fried chicken, multiplies on drive-through, which has been in focus since 2017, said finance chief Louis “Dusty” Profumo. “We have been doing this for years, and the results pay off. It really benefits our business, “he said, pointing to a 15% to 20% increase in drive-through sales since March, with sales now becoming almost all Church business.
Church’s is looking for ways to reduce the size of some of its restaurants, Profumo said. “Customers want their food anywhere, anytime,” he said. “It’s very efficient to run all of your business through drive-through.” Most dining rooms are closed for now, according to Mr. Profumo
Church’s Chicken launched a new delivery and payment system to restaurants operated by franchise holders, which make up the majority of outlets, Profumo said.
Panda Express in June added its own shipping service, said David Landsberg, chief financial officer of the holding company Panda Restaurant Group Inc. “We have made a greater commitment to delivery since the pandemic began,” said Mr. Landsberg.
Panda has invested $ 40 million since the beginning of the pandemic in improving health and safety measures and its shipping platform. The company is looking to hire 30,000 new employees this year, although it has recently stopped reopening the lobby for customers to carry out their orders.
Panda’s dining room remains closed, even though management wants to reopen it. “This is about when social guidelines distance, and at this point, it might not happen until around 2021,” said Mr. Landsberg.
About a third of RBI dining rooms in the US and Canada have been reopened, Mr Dunnigan said, adding that the company plans to do it for all of them. RBI posted a higher average revenue per order in the drive-through and shipping business compared to dine-in.
earlier this month he said open more stores with drive-through lines for digital orders. More than 60% of new stores will include this line, which is specifically for receiving orders that are placed in advance online.
Even restaurants that offer dinner before the pandemic is adjusting their business.
Waffle House Inc., a restaurant chain based in Norcross, Ga., Expects more takeout customers as the pandemic continues, said Chairman Joe Rogers. “We will have a slightly more advanced business, and fewer competitors,” Mr. Rogers said, referring to the financial struggles of some of his rivals.
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