COVID-19 And The Restaurant Industry: What Happens When Winter Comes?

COVID-19 And The Restaurant Industry:
What Happens When Winter Comes?

The travel and hospitality industries have taken a huge hit in 2020 because of the COVID-19 pandemic. Still, one of the bright spots to emerge has been the public's immediate acceptance of outdoor dining as soon as the worst of the restrictions was lifted.

Outdoor restaurant
Outdoor restaurant (Image by Positive Images of Pixabay)

Even for places like New York City, which rely to an enormous extent on tourist dollars, it was a lifeline to a struggling restaurant industry.

But, what happens across North America now that temperatures are getting colder?

Jason Kaplan, CEO of the New-York based restaurant consulting group JK Consulting, is quoted by CNN. "Everybody is scared of the winter right now," he said. "[They are] still losing money, regardless of delivery and takeout and outdoor dining, they're still not being profitable. And they're still having problems paying rent."

In some areas, like NYC, indoor dining is still banned. In others, some indoor dining is allowed, but the social distancing regulations make it extremely difficult for restaurants to just break even. 

Prolonging The Season

The first line of defence seems to be offense - i.e. trying to make the possibility of outdoor dining last as long as possible. Measures taken by some restaurants include:

  • Strategically placed outdoor heaters;
  • Well placed rows of shrubbery or ornamentation that blocks the wind;
  • Making sure tables and chairs are made of suitable materials - i.e. not metal, which feels cold to the touch;
  • Offering lap blankets for use (and laundering them after each use);
  • Glass or plexiglass panels to block winds.

In temperate zones, a covered patio roof can be a viable solution for nearly the whole season.

Government programs that offer payroll relief are another important step in enabling the restaurant industry to weather the pandemic.

Outdoor dining
Image by Candid Shots of pexels

We In The North

We in the north have a problem ahead, and it’s called winter.

The words come from Avery Shenfeld, managing director and chief economist of CIBC Capital Markets. According to Reuters, the Canadian food service industry has lost about 400,000 jobs because of the virus and its effects, which translates into losses of almost $45 billion overall year over year. 

Janet Zuccarini is owner and chief executive of Gusto 54, a company that owns several restaurants in Toronto. She reports buying heaters for expanded patios. 

“You’re not looking to make money during the pandemic, you’re looking to survive,” she said to Reuters. “The bar is set pretty low right now. ... The pandemic has really exposed the weakness in this industry.”

Winter Options

In Canada and other northern areas where winter is serious business, the situation places even more emphasis on takeout, delivery, and curbside pick-up.

That will build on the trend that already began this year. According to a survey by Upserve, as of July, Canadian restaurants had seen a “782.7% increase in Online Order sales volume growth.” 

The Upserve report also warns the industry to lean into the online ordering environment. “It’s key that restaurants find an online ordering solution that works for their customers by the fall,” the report said.

Increasing delivery costs might be in order to help offset the necessary changes. What's clear is that the landscape for the restaurant business has changed drastically, and will probably never fully return to a pre-pandemic status.