There has been pretty much nothing but bad news for the restaurant industry since the COVID pandemic went global. In-store dining widely shut down (then re-shut down), third-party delivery services have continued their parasitic practices, and an alarming number of restaurants have permanently closed.
But in this crisis, Bentley Hall sees an opportunity for restaurants — in the grocery aisle. Hall is the CEO of Good Eggs, an online grocer serving the Bay Area. I spoke with him by phone last week, and during our chat he explained why he thinks we’ll see more restaurant food pop up at grocery stores.
“There’s no reason that the top ten restaurants in a category can’t have SKUs on Good Eggs,” Hall told me by phone last week. “Send us a pallet of your best meals!”
Hall said he has a number of friends who own restaurants and added that they all have kitchens and staff that want to work. Food delivery is a lifeline, but with the high commission fees, it’s also a bit of a double-edged sword for restaurants.
A grocery store like Good Eggs can place bulk orders for either prepared meals or meal kit components. So, for instance, Taqueria X could bundle up its tortillas, sauces and slow-cooked pork as a taco kit and sell it via Good Eggs. That may not have the same satisfaction as getting one fully prepared and brought to you, but you’re still helping out the restaurant (without the commission fees), and not all food delivers well, or as Hall put it making that taco at home is “better than taking a taco that was cooked an hour ago.”
These types of kits can also extend to bars, which are going through as bad if not worse times than restaurants. After all, being at the bar is more important than what is being imbibed at a bar. Hall said that through Good Eggs, bars can put together cocktail kits for sale, providing at least some revenue while they are shut down.
Another reason Hall likes restaurants as food suppliers is their ability to ramp up production. Restaurants are used to adapting to rushes of demand, so if Good Eggs has a run on a particular item or meal kit, it’s easy to pick up the phone and ask them to crank out more that same day.
This blurring between grocery and supermarket has already been accelerated by COVID. Restaurants have been turning themselves into grocery stores, H-E-B started selling food from local restaurants in April, and Cheetah added prepped local restaurant meals to it grocery pickup service last month.
For its part, Hall said that Good Eggs has doubled its revenue and added 400 new people to its headcount in the past 90 days. The long-term ramifications of the pandemic have yet to be seen, but between the surge in online grocery shopping and the decimation of the traditional restaurant biz, it’s a good bet that we’ll be seeing more restaurant items for sale at your grocer of choice.
