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Coronavirus
The Spoon team is working hard to bring you the latest on the impact of COVID-19. Bookmark this page for our full archive on the pandemic and how the food industry is embracing innovation to fight back.
On April 6th, The Spoon had a full day virtual summit on COVID-19 strategies for food & restaurants. You can watch all the sessions from our virtual strategy summit here.
You can also check out this COVID-19 resource page for food and restaurant industry.
Lunch Meat and Waffle Makers? NPD’s Susan Schwallie on How COVID-19 is Transforming our Dining Habits
The coronavirus pandemic has upended almost every aspect of our life, and eating habits are certainly no exception. What, where, and how we’re making and consuming our food has transformed dramatically in the past eight weeks alone.
At today’s virtual event Changing Food Habits in the Era of COVID-19, Susan Schwallie of market research firm NPD Group dug into the data on how the pandemic is shifting the way that we eat. Some you might be able to guess (more carbs and online grocery), but NPD’s numbers give some surprising insight into where and what we’re eating right now — especially at home. Here are a few of the biggest shifts she’s seen:
More Eating at Home
Unsurprisingly, as restaurant dining rooms around the country shuttered in March and consumers began working from home, people started to eat more at home. Schwallie noted that there was about a 6 percent lift in the number of meals consumers ate at home this April, compared to the same time period last year.
That might not seem like a lot. But according to Schwallie, “these are actually massive numbers.” Consumers already ate about 80 percent of their meals at home, a carryover from the shift away from restaurants after the 2008 recession, so that additional six percent equates to millions of meals.
The Return of the Sandwich
Not only are people eating more at home, what they’re eating is also shifting because of the pandemic. Schwallie noted that consumers are cooking in big batches, relying on leftovers, and buying private label and less expensive brands to make their dollars go further. As she pointed out, these shifts are pretty similar to what happened in the wake of the 2008 Recession — only now, disruptions in the supply chain are causing temporary shortages of products like flour, yeast, and pasta.
The Recession also saw the rise of brown bag lunches — something that’s not exactly relevant now. In fact, Schwallie noted that lunch is the meal experiencing the biggest shift lately, as office workers no longer pick up food to-go from restaurants. “It’s the return of the sandwich,” she said.
In fact, the food with the biggest spike in at-home consumption since the pandemic began? Lunch meat. (The beverage with the biggest spike is — you guessed it — wine.)
The Rise of Niche Appliances (and Carbs)
With more people cooking at home, it’s no surprise that we’re relying more heavily on kitchen appliances. But the type of appliances may be surprising. Schwallie said that in the week ending March 7 — around the time that people were realizing they might be at home a lot over the coming months — there was double-digit growth in sales of niche food and beverage appliances like soda makers, grills, pasta machines, and pizza ovens.
She noted that “carb-related categories” also experienced an uptick in home usage: waffle makers, air fryers, rice cookers, bread makers, etc. One obvious reason is that consumers are turning to comfort food right now. Schwallie also pointed out that as people get into cooking ruts, they might dust off specialized appliances to spice up their meal routine.
Switching to Online and Digital
“COVID has been an accelerator for everything online and digital,” Schwallie stated towards the end of the event. That’s certainly true for the food sector. She noted that third-party grocery delivery experienced a nearly 300 percent increase in sales in April alone.
As we’ve covered pretty extensively here on The Spoon, restaurants are also making rapid pivots to go digital. Schwallie said that online ordering for takeaway orders from restaurants is on the rise, as are ghost kitchens built to fulfill said orders.
What’s Next?
So which of these trends will stick around once shelter in place orders lift and we’re able to return to restaurants? Schwallie named ghost kitchens and online grocery orders as some of the technology that will carry over into the post-COVID world, for sure. Baking bread and using our waffle makers, though? Those trends might not have the same staying power.
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Next Thursday we’ll be back with a virtual event on The Future of Kitchen Design in a Post-COVID World, with Johnny Grey. Sign up — and check out our schedule of upcoming online events — here.
You can watch today’s event in full below:
Zuul Kitchens and Figure 8 Team Up for Ghost Kitchen Consulting Firm
Ghost kitchen provider Zuul Kitchens and delivery consulting firm Figure 8 Logistics announced via email today the launch of Zuul Studios. The initiative combines Zuul’s operational chops when it comes to ghost kitchens with Figure 8’s expertise around delivery strategy and logistics for restaurants.
Zuul launched its first ghost kitchen facility in NYC last year for restaurants needing more space to fulfill off-premises orders. Like other major ghost kitchen networks, Zuul provides members with kitchen infrastructure, labor support, delivery fulfillment, and consultations about menu and POS integrations.
Meanwhile, Figure 8 is a consulting firm for food delivery businesses that works with restaurant operators to analyze their existing strategies and improve upon them. Helping restaurants launch native delivery — that is, delivery orders that originate on the restaurant’s digital properties, not those of third parties — is a key offering Figure 8 pushes.
With Zuul Studios, it seems the two companies have put the best of their respective capabilities together to offer restaurants both the physical space to fulfill more delivery orders and the strategic know-how to build a stronger business around off-premises offerings. Zuul Studios says will help restaurants design, build, and launch ghost kitchen operations, configure an affordable tech stack for off-premises models, and launch virtual restaurant brands.
According to the press release, “Zuul Studios acts as a catalyst for helping restaurants and real estate owners remain competitive and develop sustainable food delivery business models. Combining Zuul’s expertise operating ghost kitchens and Figure 8’s experience in food delivery consulting, Zuul Studios is able to create innovative delivery strategies for their clients.”
Of course right now, the pandemic has turned most restaurants into ghost kitchens that can only serve delivery and takeout orders. And though restaurants are slowly reopening, by and large they won’t return to the pre-coronavirus days of packed dining rooms. For QSRs and fast-casual spots that survive, off-premises will be an important element of the overall restaurant business model of the future.
Ages ago, Chowly’s Sterling Douglass mentioned that when it comes to ghost kitchens, it’s “a tough business, in some ways tougher than running a traditional restaurant.” That’s still true. A lot of the methodology, whether around operations or financials, that would apply to a dine-in restaurant isn’t relevant in a ghost kitchen setting. Plus, many restaurants aren’t even sure of how to determine whether they have the demand to even warrant a ghost kitchen operation. As businesses shift into this new and very off-premises-focused normal, many of these questions will need to be addressed.
That makes a consulting firm for ghost kitchens a potentially attractive sell right now. Zuul Studios hasn’t publicly released numbers on how much they charge for consulting fees or kitchen space. To be honest, it’s probably out of reach for many small restaurants, though they probably won’t have the customer demand anyway. For bigger chains now looking to make delivery a bigger part of their business, teaming up with Zuul Studios might be a way to ensure smoother operations and a better off-premises strategy overall going forward.
Boston, D.C., and Baltimore Join the List of Cities That Want Caps on Third-party Delivery Fees
Baltimore, Boston, and Washington, D.C. all recently joined the growing list of cities imposing mandatory caps on the commission fees third-party delivery services charge restaurants. San Francisco, Chicago, NYC, and Los Angeles have already passed similar measures or are considering them.
The D.C. Council passed emergency COVID-19 legislation on Tuesday that, among other things, capped commission fees at 15 percent during the city’s state of emergency. As the Washington Post noted, “The commission cap, similar to ones implemented in Seattle and San Francisco, is meant to help eateries turn profits on those sales.”
Last week, city council members in Boston proposed an order for a hearing to discuss the possibility of caps on commission fees — much like the one NYC just held last week. A date has not yet been set for the Boston hearing.
Baltimore is legally prohibited from imposing caps on delivery companies, but that didn’t stop Mayor Jack Young from sending a formal letter to DoorDash, Postmates, Grubhub, and Uber Eats, asking them to cap commission fees at 15 percent.
It’s a noble gesture, but Mayor Young might as well be talking to a concrete wall. The major delivery services have made it clear that they strongly oppose any caps on commission fees, arguing that caps would make food delivery orders more expensive for consumers, lessen the number of orders coming through the platforms, and ultimately harm both restaurants and the delivery companies themselves. As a Grubhub representative put it at last week’s NYC hearing, “These caps may force us to exit certain markets or suffer substantial losses that threaten the sustainability of our businesses.”
To which one council member replied, “You’re saying a lot of stuff would force you to operate at a loss but you don’t seem to care that you’re forcing restaurants to operate at a loss.”
Grubhub, in particular, has taken severe (though deserved) heat for the way it has handled it has restaurant relationships during the COVID-19 crisis. The service sent out a press release back in March that led many to believe it was waiving commission fees for restaurants during the health crisis. In actual fact, Grubhub was only deferring those fees, and the policy included a lot of unsavory fine print that won the company yet-more bad press. And if you haven’t yet seen the viral Facebook photo that shows just how little restaurants collect from third-party delivery orders, check it here to understand why restaurants are nowhere near turning a profit under the current commission fee policies.
Other services are at least appearing to be more helpful. Postmates temporarily waived commission fees for independent restaurants, though the move only applied to new businesses signing with the platform and based in San Francisco. DoorDash has waived commission fees for all its independent restaurants through the end of May.
But what happens at the end of May? And what happens if a second wave of the novel coronavirus imposes another set of shelter-in-place mandates?
The entire restaurant industry is forever changed because of this pandemic and the dining room shutdowns it has caused. Menus are shrinking, restaurants will re-open with less seating, major chains are overhauling their entire store formats, and small businesses are going to have to adapt to technologies and procedures they might never have considered before. Delivery companies could do themselves and everyone else a huge favor by implementing their own fee caps and accepting that they’re part of the restaurant industry and need to share in some of the pain. Otherwise they can expect more government fee caps and regulations, and I wouldn’t be surprised if the whole industry forcefully turns on them at some point down the line.
Recipes for Relief Sells Professional Chef’s Recipes to Quarantined Home Cooks
Though quarantine is forcing most of us to become more dedicated home cooks, few are making fancy, restaurant-worthy dishes every night. But that might change soon.
Recipes for Relief is a website where famous chefs and mixologists post recipes for meals and drinks. Each recipe features a title, the name of the chef who created it, and a short description. You can choose to purchase the recipe for $2, $5, or $10. All of the funds go directly back to the chefs or mixologists.
The initiative grew out of meez, a recipe management tool that allows professional chefs and mixologists to digitize their recipes, make edits, scale it up/down to feed various amounts of diners, and share them with team members. Meez is currently in beta testing mode and was preparing to launch back when quarantine forced restaurants to shut their dining rooms. Since then, meez has pivoted to share the recipes with folks that are outside the professional kitchen — home cooks.
Recipes for Relief kicked off in mid-April and currently includes around 80 recipes from 20 chefs. I connected with Francine Lee, who does business development for meez, via phone to learn more about why the company decided to start Recipes for Relief. “Other than takeout and delivery, plus government aid, there’s no way to generate revenue for restaurants right now,” Lee told me. “We thought, ‘What can we do?'”
As a quarantined person who loves to cook, of course I had to give Recipes for Relief a try. I added two recipes to my cart that looked both delicious and achievable: Miso Biscotti and Cauliflower Mac and Cheese. Within 24 hours I got an email with a link to my meez account, which had the two recipes plus a dozen bonus ones. From my initial perusing, the recipes all seemed relatively easy to make and featured ingredients that the average person could actually find at a store.
Lee told me the company has also worked with the chefs to edit the recipes to make them doable for non-professionals — using more basic techniques, ubiquitous appliances, etc. “There’s also a lot of cool tips and tricks that happen in a professional kitchen that could be insightful for a home cook,” she told me. Recipes for Relief is also gathering data on what types of recipes people are buying most to curate their new offerings.
I was hesitant about the portion sizes of the recipes. Chefs obviously work on a much larger scale than home cooks. But meez has solved this problem by offering capabilities to scale the recipes (1/2x, 2x, 4x, etc) to accommodate any number of people. You can also manually enter the amount of any ingredient you have (e.g., 1 cup of cider vinegar) and all the other ingredients will adjust accordingly. You can even ask chefs about ingredient swaps in the comments.
According to Lee, the conversions are actually one of the key selling points for both meez and Recipes for Relief. That could be especially useful in our quarantine kitchens, when we’re forced to work with what we have more than ever before.
Recipes for Relief’s interface still needs some polishing. There were several grammatical errors and some of the instructions lacked detail. I’d also like allergy and dietary restrictions listed (vegetarian, vegan, gluten-free) clearly on the recipes. If meez decides to add a permanent tool targeting home cooks, not restauranteurs, these changes could make it a lot more useful.
As someone who’s worked in a restaurant and knows how complicated recipes not developed for home chefs can be, I’d normally be skeptical of tackling a restaurant recipe at home. But now, with time on my hands and a hankering for a physical project, there’s no better time to try my hand at a complicated recipe — especially if those recipes are also helping to support restaurants.
Is the DoorDash-Pennsylvania AG Partnership a Red Herring or the Start of a New Era for Gig Workers?
DoorDash has entered into a public-private partnership with the Pennsylvania Office of the Attorney General to further expand financial, healthcare, and childcare assistance to couriers (called “Dashers”) working for the third-party delivery service. DoorDash said in a company press release that this expanded support applies Dashers in Pennsylvania working for its service as well as DoorDash subsidiary Caviar.
Most of the initiatives announced build on existing support DoorDash has provided to Dashers throughout most of the pandemic. For those diagnosed with COVID-19 or/or instructed to self-quarantine because of the virus, DoorDash is providing financial assistance, applicable to those that have worked for the service for 30 days (the number was previously 60). The third-party delivery service is also subsidizing telehealth costs related to the virus for any Dasher.
Notably, the company has also launched a childcare support program for the top Dashers in its Dasher Rewards program. Those that qualify can receive financial assistance for childcare while schools remain closed due to COVID-19. According to the release, the program will provide a financial bridge to parents until Pandemic Unemployment Assistance becomes available.”
As new developments for gig workers go, none of these initiatives is particularly unique. Most third-party delivery services have been offering some financial relief as well as protective gear to workers during the pandemic. One assumes this is at least partially in response to pressure from advocates and restaurant industry personnel to take better care of gig workers, who normally don’t receive benefits like paid sick leave, healthcare, and workers compensation. In fact, DoorDash was among the companies fighting California’s Assembly Bill 5, which was signed into law in 2019 and reclassifies contract workers as employees.
What is new to this story is the involvement of a state government. Pennsylvania Attorney General Josh Shapiro is particularly vocal about how gig workers are treated. One of the stated goals on his website is to “end worker misclassification.” Depending on how extensive the partnership with DoorDash is, and how long it runs, other states could follow Shapiro’s lead.
It’s unclear right now if DoorDash’s newfound partnership is an about-face for the company or just another PR stunt. Recall that in addition to fighting California’s AB5, DoorDash was also the subject of a lawsuit filed by DC Attorney General Karl Racine, that one over unfair tipping practices for Dashers.
The answer will probably not come until we’re further out from this pandemic and business regains some sort of normalcy. As I mentioned above, the major delivery services are providing at least some form of relief to workers right now. How long these protections extend in the post-pandemic world will show whether how long-lasting third-party delivery’s commitment to its gig workers’ well being actually is.
Presto Makes Its Contactless Dining Kit Free for Restaurants Reopening Dining Rooms
Restaurant tech company Preso has released a Contactless Dining Kit to assist restaurants with social distancing measures as they prepare to reopen dining rooms in the coming days and weeks. The kit, which Presto is making available free of charge to restaurants, notably offers technologies to assist restaurants with contactless order and payment, according to an email sent to The Spoon.
In certain states, restaurants are slowly but surely reopening. Alaska, Florida, Georgia, Tennessee, Texas, and others have all loosened stay-at-home restrictions to varying degrees, though restaurants are operating at reduced capacity and with stricter social distancing measures in place.
In a letter sent to California Governor Gavin Newsom, of which The Spoon has obtained a copy, the Redwood City, CA-based company outlined the technologies on offer in its Contactless Dining Kit. “As our state looks towards reopening for business, it will be important for restaurants to operate in an environment that can reassure customers about their personal safety,” the letter states, before going on to say that the new normal will be “very different” and that “technology can play a very critical role in enabling this new normal.”
For the Contactless Dining Kit, that technology primarily addresses how restaurants can ensure social distancing during the order and pay process in the dining room. That means plenty of contactless solutions. Presto’s tech stack already offered a number of contactless order and pay solutions prior to the pandemic; for its kit, the company has pulled relevant pieces of software and hardware and bundle them together.
The contactless menu option lets restaurants place a QR code sticker on tables, which guests can scan to access the menu. Any loyalty or rewards programs the restaurant runs can be integrated into the process. For those guests that can’t use their own device or don’t want to, the restaurant can also provide the menu via a Presto tablet placed on the table.
Restaurants can choose to have those orders directly integrated into their main POS system, which would definitely be the more contactless way to go. Otherwise, orders from diners’ devices land in a Staff Tablet and will have to be input into the POS system.
Finally, the kit’s contactless payments feature lets guests pay via their own devices or the aforementioned Presto tablet on the table.
Presto says on its website that it will ship a kit within three days of a restaurant signing up for one. Deployment takes “less than an hour in most cases” — though that doesn’t factor in restaurant staff having to learn how to work a new technology. On that front, Presto appears to be trying to make the switch to a more tech-centric dining experience as easy as possible for restaurants. Kits arrive with a tablet, 60 QR code stickers and table placards, setup instructions, and a web portal from which businesses can create and manage their online menus.
As I mentioned earlier, Presto is giving this pack away for free right now to restaurants. That’s a generous move, given the turbulent times, but it’s also a smart one from a business perspective. Presto is a front-of-house technology company, and at the moment, front-of-house players are fighting to remain relevant in a world where the in-house dining experience will probably never be the same. Allowing restaurants to sample its technology stack for free potentially gives Presto wider exposure across the sector and, so long as execution goes well, helps the company solidify its credibility as an important tech company in the space.
The company hasn’t yet said if there is a time limit on getting the kit, only that “supplies are limited” and that the offer is only valid while said supplies last.
That it’s chosen to focus on contactless order and payments is also a move that could pay off down the line for Presto. As a growing number of restaurant industry figures have said, contactless will be the way forward, and one of the most important parts of the restaurant experience to get right is ordering and payments.
If Presto can take some headache out of that process for restaurants with its technology, it could win over a lot of new and loyal clients as the foodservice world starts to reopen.
Will Bellwether Coffee’s Plug-and-Play Roasters Help Cafés Survive COVID-19?
Every Tuesday, before I make my weekly outing to grocery shop, I stop by my favorite coffee shop and get a black coffee and a donut. The shop used to be a hubbub of activity — freelancers hanging out on their laptops, friends catching up, kids running around — but now it’s quiet, with a masked barista serving up to-go coffees to patrons who line up outside to be served.
Like most other foodservice establishments, coffee shops are feeling the pain of COVID-19. To compensate some are cutting hours, reducing staff, or trying to incorporate new revenue streams, like selling local products, flowers, and emphasizing bagged coffee.
Bellwether Coffee, a company that makes electric, ventless zero-emissions connected commercial coffee roasters that can go into cafés, is trying to help coffee shops supplement their income by roasting their own beans. To try and get more partners during the pandemic, they’re offering to waive the first two months of roaster fees — provided the shop installs it between May and July. The roasters can be delivered in as little as a week.
On the one hand, coffee shops who are struggling to stay afloat probably aren’t able to commit to purchasing a pricey coffee roaster (the machines cost $75,000 to buy or can be rented for a monthly fee), even with the deal. On the other, Bellwether roasters could offer these shops a new revenue stream as they sell bagged beans roasted in-house. The coffee shops could also use their house-roasted beans in their drinks, so they don’t have to purchase coffee from other roasters.
The only reason this is actually feasible is because Bellwether’s roasters don’t require any special setup or expertise. The device, which is about the size of a standard fridge, is automated, so baristas or café managers don’t have to have any roasting experience to figure out how to use it. It runs on electricity and is ventless, so coffee shops don’t have to build out expensive ventilation systems to start roasting — something which would be especially tricky given the limitations around the pandemic.
The software that controls Bellwether’s roasters also features a marketplace where users can browse and purchase green coffee beans in 22-pound boxes. That way, shops don’t have to worry about setting up relationships with suppliers or buy massive amounts of beans if they’re just trying to set up a temporary roasting solution.
With all of that said, the roaster is still pricey. The Bellwether website notes that shops can lease the roaster for $1,150 a month for 60 months, but that’s still cost-prohibitive for small, local coffee shops — coronavirus or no.
Since coffee shops already have to-go infrastructure set up — takeaway cups and containers, etc. — they might actually have a better chance of surviving the pandemic than, say, full-service restaurants. They can also operate pretty easily with a bare-bones staff, since a single barista could take orders, make coffee, bag up pastries, etc.
That said, coffee shops, like all foodservice joints, still have a significant amount of overhead. Just like restaurants, we’ll continue to see cafés get creative to figure out new ways to cut costs and spark new revenue streams. Roasting their own beans could help coffee shops do both of those things. The question will then become whether or not cafés want to keep their Bellwether roasters after they’re able to reopen their doors post-pandemic.
Here’s How People Are Using Their Instant Pots During Quarantine
By now we’ve all read about how people have changed their eating and cooking habits during the quarantine. But how exactly are they using their Instant Pots, arguably the runaway countertop cooking success story of the last few years, and the first cooking gadget many millennials ever purchased on their own?
To find out, I decided to check in with the maker of the Instant Pot appliance and they shared some data on exactly how people are using their multicookers ever since the pandemic forced the entire world to stay home and start cooking.
One of the big things that changed is the cyclicality of the normal cooking week. In a typical non-pandemic week, Sunday is the biggest day for Instant Pot by a substantial margin, with 25% off all cooking activity occurring on the day of rest.
During quarantine, cooking days have become more evenly distributed as people are home pretty much all the time and Sunday only accounts for 17% of cooking activity. Conversely, Friday, which normally represents the weekly cooking activity nadir, has jumped from 9% of all cooking activity to 13% during the quarantine.
Apparently you can make bread with your Instant Pot (who knew?), and just like with pretty much every other cooking device, the multifunction cooker has seen a sharp increase in loavemaking. The chart above shows how total searches for bread recipes jumped 700% right as the US went into social distancing in early March. Interestingly, this increase is almost identical to the 800% jump in breadmaker sales that happened at the same time.
The search for comfort has also been well-documented. That embrace of more carb-centric food has meant a significant drop in vegan and vegetarian diets, where searches dropped 82% by the week after social distancing had been announced.
And it wasn’t just plant-forward diets that took a hit during coronavirus, as Keto-centric recipes saw a 70% drop in the searches in the same time period.
The big question is will all of these forced changes brought on by the jarring impact of a forced quarantine stick around? My guess is some of the behavior change will have some staying power beyond summer as consumers adjust to lower overall incomes and continue to cook at home more as they head back to work (even at reduced or moderated schedules), but that we will see (and already are seeing) some partial snap-backs to behaviors and routines that were in place before the quarantine.
Fight Club: Mischief. Mayhem. Third-Party Delivery Fee Caps.
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If you like a good fight, the one around restaurant commission fee caps is worth watching. I spent the better part of three-plus hours the other day tuned into the New York City Council’s Committee on Consumer Affairs and Business Licensing public hearing. One hotly debated topic was around capping commission fees third-party delivery services like Grubhub and Uber Eats charge restaurants.
I’d love to say everything got resolved and NYC will be placing caps on third-party service commission fees for all time. The reality is that this fight was here long before the pandemic and will be around long after it leaves.
I’m sure you’ve heard of the brouhaha brewing around the issue. Restaurant industry advocates and businesses alike had flagged those third-party delivery commission fees — which can go as high as 30 percent per transaction — as prohibitively expensive for restaurants. With dining rooms closed now, most restaurants are left with the options of either shutting down completely or relying on a third-party service like Grubhub to help them execute on delivery orders.
One restauranteur who testified at this week’s hearing explained that for independent restaurants, the fees are more or less non-negotiable. (Side note: he also expressed fear of retaliation from delivery companies for his speaking at the hearing.) Jessica Lappin, a former NYC council member and the President of the Alliance for Downtown New York, said that even if restaurants are doing takeout and delivery right now, they are doing it at a loss. Council member Mark Gjonaj suggested that due to the commission fees, each transaction a restaurant makes is “yielding a net loss.”
Perhaps the most telling moment came when a Grubhub representative took to the mic to “express Grubhub’s strong opposition” to fee caps. You can watch the entire (and rather circular) debate that broke out here, but it more or less boiled down to the idea that if NYC and other cities successfully impose fee caps, Grubhub et al. will have to change their business model.
Therein lies the marrow of the matter in terms of why third-party delivery companies oppose commission fee caps and other changes (e.g., reclassifying workers as employees). Government oversight of those fees cost these companies more money, and further erode their chances of ever becoming profitable. An unprofitable model won’t satisfy investors, and third-party delivery as we know it would then be on the rocks.
Sky-high delivery fees and a faltering economy won’t help the model in terms of its attraction to the average end consumer. And they certainly won’t improve the net-negative returns restaurants are making at the moment.
In some cities, Big Government has already stepped in. San Francisco, Seattle, and Chicago have all introduced fee caps that will last at least as long as dining rooms remain closed. Los Angeles is considering a similar measure. NYC’s proposed 10 percent cap was actually introduced months before the novel coronavirus hit the U.S. in full force.
As emergency measures, these fee caps feel necessary right now if independent restaurants are to have any kind of shot at keeping the lights on. Longer term, everyone (restaurants, advocates, government, tech companies, and consumers) will have a responsibility to address how much damage the delivery model is actually doing. It seems a global pandemic that’s taking lives and shuttering businesses isn’t enough to make some of these services stop siphoning the livelihood from restaurants. Are those really the businesses we want calling the shots in the restaurant industry in the future?
McDonald’s limited menu is good news for the drive-thru lane.
Among other things, like drive-thru lanes generating more sales, McDonald’s spent quite a bit of its earnings call this week talking about its menu. Since shelter-in-place orders forced the chain to close down dining rooms and rely on off-premises orders, McDonald’s has been offering a limited menu. For example, it doesn’t offer breakfast for the time being.
Cuts like that were made to help the mega-chain manage the operational difficulties restaurants face right now. On this week’s call, CEO Chris Kempczinski suggested customers should not expect every McDonald’s in the nation to immediately revert back to its pre-pandemic menu.
Smaller menus for the long term could work in McDonald’s favor, though. When we looked at the QSR Drive-Thru Study last year, one of the standout points was the steady increase in drive-thru wait times over the last couple decades. Growing right alongside those wait times has been the number of items QSRs offer on their menus.
These complex menus take longer to read, present customers with the tyranny of too many choices, and up the risk of an order being inaccurate when it is ready. None of those things make for speedy service, and with more customers likely going to opt for the drive-thru lane over the dining room now, finding ways to fulfill orders faster is crucial for QSRs.
No one is suggesting we revert back to my favorite picture of all time, this McDonald’s menu from the ’80s. But as restaurants pare down menus and plan to work with reduced capacity and limited staff once they reopen, the bloated mess of choices QSR’s previously offered may become a thing of the past.
Sweetgreen just added dinner options.
One company not paring down its menu is Sweetgreen. On LinkedIn this week, cofounder and Chief Brand Officer Nathaniel Ru unveiled the chain’s new dinner menu, called Plates.
For the last four weeks, the tech-forward fast-casual chain — most widely known for its highly Instagrammable salads — has been testing a Sweetgreen dinner menu. Via a post on Medium, the company said the process has been about “operationalizing an entirely novel concept (normally a year-long process) in just 30 socially distant days.”
That 30-day process looks, from the photos, to have turned up a menu full of plant-centric dishes and lots of legumes, grains, and sauces. If you want more details around how the team put this new concept together, the full Medium post is definitely worth a read.
Sweetgreen had been planning the dinner concept for some time in the hopes of launching it next year. But, as the Medium post notes, “given the current state of uncertainty, the need for warm, familial, and home-cooked food has never felt more important.”
They’re right on the money. Family-style meals and comfort food are two major trends right now for restaurants as people shelter in place. I’ve never considered couscous and warm leafy greens comfort food, but I’m from rural(ish) Tennessee so what do I know? Plenty of folks are health conscious these days, and with many consumers likely to be wary for some time about going out to eat, a dinner concept is a smart play for Sweetgreen.
Now if we could just get it delivered without those pesky commission fees.
Novameat Develops 3D-printed Pork Alternative to Feed Plant-based Meat Demand
Spanish startup Novameat announced today that it had developed a realistic plant-based pork product with the same texture as real meat. And it couldn’t have come at a more opportune time.
The coronavirus pandemic is wreaking havoc across all sectors of the food supply chain, but the hardest hit area might be the meat industry. Employee infections are forcing processing plants to shut down, which is spurring meat shortages. At the same time, some consumers are worried about the link between eating animals and infectious diseases.
But all these misfortunes for the meat industry mean that the plant-based meat industry could be at the cusp of its heydey. That’s especially true for pork. The pork industry was already struggling with the outbreak of African Swine Fever, which decimated the pig population in China. Now major manufacturing plants, from Tyson to Hormel, are facing a new enemy with COVID-19.
Novameat, which uses 3D printing technology to create realistic meat alternatives, sees this as an opportunity. That’s why they recently developed a plant-based pork prototype. The meatless pork is made with pea and rice protein isolates, olive oil, seaweed extract and beet juice and produced with Novameat’s signature micro-extrusion technology to mimic the texture of meat.
So far, Novameat has chiefly been focusing on developing 3D printed steaks, though it has yet to bring any of its products to market. The startup raised an undisclosed amount of funding last year and has plans to sell its plant-based meat to restaurants as well as to license out its printing technology to bigger companies.
In an email, Novameat CEO Giuseppe Scionti told me that they decided to create this pork prototype “in a moment of the need for flexibility and adaptability in the proteins market, and seen the global disruption in pork meat supply.”
But the new product isn’t just motivated by the coronavirus pandemic. Scionti also noted that Novameat is trying to demonstrate that their tech is versatile enough to create a wide range of plant-based meat and seafood products.
Scionti told me that, despite the pandemic, they’re still sticking with their original timeline to sell 3D printed plant-based steak to a few restaurants in Europe by the end of 2020. That might be ambitious depending on when restaurants reopen, and what they look like when they do. I’m not sure if high-tech vegan steaks (or pork) fit into that new normal, with restaurants operating at reduced capacity and slimmed-down staff numbers.
However, Novameat’s other sales channel could actually be nudged forward by COVID-19. The company plans to license out its 3D printing technology to plant-based meat manufacturers. Scionti told me in January that would be over the next two to three years, but considering how alternative protein companies gaining investment left and right, and Big Meat companies like Cargill are investing more and more in plant-based, I could see that timeline getting moved up.
One selling point for 3D printed meat in particular is that its production is largely automated. In fact, Scionti noted that they developed the pork alternative entirely while working from home. In a time social distancing orders are keeping many from their R&D labs, 3D printing doesn’t have to slow down. That could make it printed meat alternatives a more appealing option in the post-coronavirus world.
I Attended a Techstars Virtual Demo Day and It Was Actually Pretty Good
One of the hardest parts for me personally about COVID-19 has been watching my son lose a big part of a senior year in high school. Daily zoom lectures are no replacement for the camaraderie and celebration of wrapping up twelve years of a primary school education, and the cancellation of graduation ceremonies is a particularly difficult pill to swallow for young adults and their families who’ve waited a lifetime to cheer the receiving of a diploma.
I imagine those participating in startup accelerators may be experiencing a similar feeling. While it may not be the same as replacing the culmination of twelve years of primary education, the 12 or so weeks spent in an accelerator are intense and life-changing for all involved and, like with my son’s high school, many of those days and the final “graduation” have been swapped out for virtual facsimiles.
Which is why I decided to attend the recent BSH Appliances/Techstars Future Home Demo Day. I’d had the chance to attend the “graduation” of the first cohort of this same accelerator in person a year ago in Munich, so I figured I’d have the proper context to see how this virtual demo day compared to the real thing.
The accelerator cohort spent the first six weeks together in Munich, but the decision was made in mid-March to send everyone home and conduct the rest of the accelerator time virtually, including this final virtual demo day. Last year, each of the 10 groups of founders packed into a Munich movie theater and, over the course of the next couple hours, gave polished pitches about their companies as friends, mentors and potential investors cheered them on.
This year, the event was held via (you guessed it) Zoom, where an initial kick off with comments from the accelerator organizers, and from there each founder would give a quick description of their company. The fuller pitches, the ones that essentially replaced the ones given at demo day in Munich, were pre-recorded so they would, as BSH’s accelerator organizer Tibor Kramer explained, “avoid any issues with streaming.”
The inital kickoff in Zoom was pretty fun. Despite presenting from their own homes virtually, I could sense the founders and the accelerator organizers participating really were happy to see each other and they all cheered each other on and fondly called each other by their nicknames when each took over and gave a brief intro to their company.
At last year’s event, many in the audience held a glass of wine or a beer in hand as they cheered along the founders from their seats. This year, many of the founders and accelerator participants cheered each other along with a celebratory beer or glass of wine as they sat in front of their computers.
After the demo day kickoff, attendees were encouraged to spend the next hour watching the pre-recorded pitches and then drop into private web video chats with each founder team to ask questions and congratulate them. BSH invited me to drop into a few of these meetings and ask questions so I did.
In total, I dropped in to meet four of the founder teams individually and each one seemed excited about graduating and the future despite the obvious differences in today’s landscape. Some admitted that there were definitely some challenges with going virtual, with a couple pointing to the time zone differences as the biggest struggle for them as they tried to participate remotely during Munich business hours from places as far-flung as Bangalore.
“One big change was time zone management,” said Saakshi Jain, cofounder of Zelish a kitchen and meal planning app startup. “We are in a very different time zone that everyone else and it was very late for us.”
Another big difference was the loss of some of the exchanges that are only possible in-person.
“When you’re there with the other founders you really build this strength with the cohort that is hard to replicate in a virtual setting,” said Mihai Hogea, cofounder of Pepper, a voice-powered nutrition & diet management startup. Hogea gave an example of how the accelerator organizers took his cofounder (and brother) Andrei to some Munich brewhouses to celebrate his 30th birthday.
Overall, however, I found my first accelerator virtual demo day enjoyable and pretty informative. I was able to spend more time with each founder I wanted to chat with and felt I found out more about their companies than I would have in an in-person setting, in part because I was able to ask them questions and take some notes on my computer which, it goes without saying, would have been somewhat awkward in-person at a Munich movie theater.
For the founders, I think they also found it enjoyable, but I still think they would have preferred to be drinking beer in Munich. All of them told me the first six weeks spent in person really allowed them to bond and helped make the final half of the accelerator more productive and enjoyable, despite being virtual.
For future accelerators, I imagine the same success will depend somewhat on how much in-person time the cohort gets. And, hopefully next year, the third cohort of this accelerator will be able to get together in Munich and pitch their companies in a dark Munich movie theater.
