Close Ad

The Spoon

Daily news and analysis about the food tech revolution

takeout

Ghost Kitchens! Fee Caps! Igloos! Tracking the Restaurant Biz’s Changes Over the Last 12 Months

For the majority of restaurants around the U.S., last week marked the one-year anniversary since stay-at-home mandates initially forced dining rooms to close down. What’s followed has been 12 months of great uncertainty, loss, and struggle. But it’s also been a time of astounding resilience and creativity, with restaurants and restaurant tech companies alike have pivoted and shape-shifted to survive the times. 

We’ve been checking in with individuals from both spheres to see where these businesses are now and what’s most useful in terms of tools and tactics as dining rooms slowly reopen and the world goes back to some version of “normal.” 

But to better appreciate how far we’ve come and how much work has gone into this industry’s survival over the last year, I’d like to pause and take a brief look back in time at some of the major stories from these last 12 months.  

March 2020

  • States across the U.S. mandate dining room shutdowns. Restaurants large and small scramble to make the overnight shift to delivery and takeout formats.
  • Restaurant tech companies start offering software and services free of charge to restaurants. Third-party delivery services like Uber Eats and Postmates waive some fees — though not without some controversies.
  • Restaurants like Canter’s Deli, Wahoo’s Fish Tacos, and Torchy’s Tacos discuss strategies for going off-premises. Some include paring down menus, prioritizing takeout meals, and going DIY when it comes to the drive-thru.

April 2020

May 2020

June 2020

  • Some restaurant chains, including Panda Express, start to launch their own in-house delivery services.
  • Restaurants get really creative with their ideas on how to safely reopen dining rooms.
  • This Latin American startup teaches us how to run a restaurant from a mobile phone. (Hint: everyone will do this in the future.)

July

August

September

October

  • The in-house delivery versus third-party delivery debate further heats up, with many encouraging restaurants to take back control of their digital orders.
  • Crave Collective and others put a fine-dining spin on the ghost kitchen and virtual restaurant concepts.

November

  • California passes Proposition 22, which lets third-party delivery services classify their couriers and drivers as independent contractors and keeps these companies from having to pay workers comp, health insurance, and other benefits.
  • Investment in back-of-house technology grows as both restaurants and restaurant tech investors realize the foreseeable future of the industry is in the kitchen, not the dining room.

January 2021

Feburary

March

Obviously this brief timeline isn’t comprehensive, since there’s no way to really capture the true scope of the last 12 months in a single newsletter. It is meant to be a snapshot only of the change and turns the industry took over the last year.

Which is where you, readers, come in. Whether you’re part of an eating establishment, tech company, or an avid foodie, we would love to hear your restaurant experiences over the last year. Drop us a line at tips@thespoon.tech.

Restaurant Tech ‘Round the Web

Nation’s Restaurant News has a new gallery showcasing stories “from the front lines” of the restaurant industry — that is, the restaurants themselves. NRN has compiled first-hand accounts of owners, managers, brand executives and others about their experiences from the last year.

Restaurant Dive has an ongoing analysis of the state of restaurants one year later across a number of U.S. cities. Available so far are in-depth looks at Los Angeles, New York City, and Seattle. More to come.

Grubstreet looks at lessons the New York City restaurant scene has learned over the last 12 months, and what comes next.

Survey: Safety Is Now a Top Concern for Restaurant Customers Ordering Off-Premises

A quality off-premises restaurant experience is no longer just about food arriving on time and fries not being soggy. According to restaurant tech company Toast’s latest report, attention to cleanliness and safety is one of the top three concerns for restaurant guests for both delivery and takeout orders.

The Toast report, which The Spoon received a copy of, surveyed over 700 restaurant guests around how their expectations have changed as a result of the pandemic and what they consider to be an ideal restaurant experience today.

Almost half, or 48 percent, of guests surveyed placed cleanliness/safety as the top third concern for delivery orders, behind quality of food and ease of ordering. Another 40 percent placed it as the second main concern for takeout orders.

Seeing as we’re in the middle of a global pandemic, it makes sense that safety has wound its way to the top of the list for restaurant consumers. (As a category, cleanliness and safety were much lower on the list of concerns when Toast published a similar guest survey in January.) But Toast’s report also found that guests are ordering takeout more frequently than delivery.

From the report:

“7% of guests reported ordering takeout through a third- party app multiple times a day. 9% of guests reported ordering takeout through a restaurant’s app or website once a day. 16% of guests reported ordering takeout through a restaurant’s app or website multiple times a week. And 20% of guests reported ordering takeout through a restaurant’s app or website once a week.”

Cost, of course, remains a big issue with third-party delivery apps. That’s especially true now, with many restaurants trying to offset the high commission fees these services charge by raising delivery prices. But given the pandemic we are in, safety is obviously a growing concern.

One reason takeout might be more popular right now than delivery is that food goes through more touchpoints when someone drops it at your house, since the meal has to be collected by a driver. Issues around delivery drivers tampering with food abounded even before the pandemic. In response, some chains now offer tamper-free packaging. But even setting that aside for a minute, customers still have to worry about the cleanliness of the driver’s vehicle, whether or not that person is sick, and if they are wearing protective gear. Toast noted in its report that, at least for now, customers “might prefer the level of control over cleanliness and safety they get when picking food orders up themselves.”

Toast recommends that restaurants communicate frequently and clearly with customers about steps they are taking to keep their businesses safe. However, it can be tough to guarantee safety if the food is leaving their hands and going to the customer via a third-party delivery service. There’s no quick fix for that, unfortunately, since most restaurants can’t afford to keep their own delivery fleet. For now, restaurants should continue prioritizing cleanliness on takeout orders and hope their third-party delivery counterparts are doing the same.

In Through the Outdoors? Restaurants Hit the Pavement as They Reopen

This is the web version of our newsletter. Sign up today to get updates on the rapidly changing nature of the food tech industry.

Not so long ago, outdoor space at a restaurant was just a nice-to-have feature some restaurants could afford to offer. Surprise surprise (not), the pandemic is changing that. With new guidelines and requirements around safety and social distancing, more restaurant experiences are moving outdoors. And it’s not just for dine-in customers, either.

This week, San Francisco Mayor London Breed announced the Shared Spaces Program, which in part allows restaurants to use public space like sidewalks, whole or partial streets, and parks to fulfill restaurant pickup orders. Restaurants can apply for a permit for free, and once the city approves dine-in service for outdoor space, those areas can be used to seat customers as well.

San Francisco isn’t alone. San Jose this month approved its “al fresco plan” that will allow restaurants to use some public spaces to fulfill takeout orders and eventually hold more seating. In Rotterdam, The Netherlands, restaurants will be allowed to convert parking spaces in front of their buildings to do the same.

While these measures could help restaurants eventually boost dine-in traffic once they reopen, at present, they may actually help restaurants run smoother to-go operations. Trying to run an ad hoc takeout business is challenging for many restaurants that have previously only operated under a dine-in model. In some cases, selling to-go orders has caused outright mayhem as crowds of people gather to wait for their to-go orders and staff dart around trying to determine which meal belongs to which angry customer.

Make no mistake: there will be operational challenges using public spaces, too. In fact if it’s not managed correctly, the whole thing could become its own social-distancing disaster. Viewed through a more optimistic lens, it could provide more space for customers and delivery drivers waiting to retrieve their orders. 

And you know what would really enhance the public spaces restaurant experience? Some technology. Earlier this week, I spoke with two companies, hardware manufacturer Elo and software startup Clicksys, about a new self-service kiosk they’re trialing at a restaurant in Stockholm, Sweden. 

In summary, the idea is to have a kiosk installed into the front wall or window of a restaurant, much like a bank ATM, so that folks passing on the street can simply stroll up, order, pay, and wait for their food without having to actually enter the restaurant.

There are a lot of good use cases for this idea, and these newfound public spaces are one of them. If we’re talking about relieving operational mayhem, an automated system would cut down on the amount of people milling around in said public space. Staff would not need to man an order station, since the kiosk processes ordering and payments. And since the system texts users when their meal is ready, those customers would be able to better time their entrance and exit and not have to stand around playing the waiting game.  

The Elo-Clicksys machine is currently only available in Europe, but there are plenty of restaurant tech companies in the U.S. that should take note of this concept. Right now, front-of-house technology is having to truly prove its worth in a world without dining rooms. Self-service kiosks (with hand sanitizer next to them, please) built for the outdoor world could prove lucrative in the coming months. 

Off-Premises Sales Are Back Up

Another reason the forthcoming Shared Spaces could get a lot of use this summer: sentiment around off-premises orders is back up. Nation’s Restaurant News reports that after taking a big dip at the beginning of May, when many restaurants began to reopen dining rooms, sales of takeout orders are back up.

Restaurant analytics firm Black Box Intelligence, which provided the source material for NRN’s post, said that early in May, customers complained of long wait times for curbside pickup orders but that “guest sentiment trends have started to recover as of week-ended May 24, with off-premise sentiment returning to similar levels as were seen in April.”

Presumably, people got excited about going back to restaurants instead of ordering takeout, then realized what a pain in the a$$ dine-in service is going to be for a long time to come. Guidelines vary from state to state in the U.S., but almost all of them include reduced capacity, reduced party sizes, no buffets, and in some cases a mask requirement. Add to that the trepidation most of us wear with our masks these days anytime we set foot in public, and it’s not exactly a recipe for a packed house.

While Black Box didn’t cite the specific reason for the uptick in off-premises orders this month, my guess is that folks are still more comfortable waiting for a to-go box than eating at a sparsely populated dining room fraught with anxiety. 

DoorDash Launches an E-commerce Platform for Indie Restaurants

Ever looking to capitalize on this boost in off-premises orders, DoorDash this week announced a new e-commerce platform for independent restaurants. It’s called the DoorDash Storefront, and it’s supposed to offer restaurants a way to build out their own digital storefronts through which they can process orders and payments. Restaurant sign up with the platform and get their own website/app for takeout and delivery orders — powered, of course, by DoorDash’s system. The digital storefront also plugs into DoorDash’s fulfillment network of drivers, so the food can actually get delivered.

DoorDash is actually addressing a need here. Sophisticated mobile apps that process orders, payments, and loyalty points are expensive and complicated to build. Small restaurants and restaurant chains generally can’t afford them, which is a negative in a restaurant industry that was just forced to go almost entirely off-premises. DoorDash said in a press release that about 40 percent of its restaurant customers do not have their own e-commerce platform.

What isn’t mentioned is what the storefronts will cost the restaurants. In bold-faced text, the company’s blog post stated that restaurants “control and own the customer experience.” It does not say customers own the data — a major issue with using a third-party delivery platform — nor does it go into exactly how the restaurant owns the customer experience. However, it’s worth noting that the blog post also states that restaurants “do not pay a commission to DoorDash on orders they receive through their Storefront.” 

DoorDash has actually been less awful to restaurants than its third-party competitors during the pandemic. The company waived commission fees for a time independent restaurants when the dining room shutdowns first took place. Still, commission fees are coming back, and offering restaurants their own digital storefronts means those restaurants will be firmly locked into the DoorDash ecosystem when it’s time to pay up.

All of which is to say, read the company’s seemingly altruistic blog post with a magnifying glass in one hand and a dose of healthy skepticism in the other.   

Check out Spoon Plus, our deep dive research and virtual events community.

Gallup: Curbside Pickup and Restaurant Takeout Show Double Digit Growth During Pandemic

A new survey from Gallup released today shows that more Americans have adopted low-contact methods of getting their food since the COVID-19 pandemic began. The survey found that 44 percent of U.S. adults picked up takeout from a restaurant in May (up from 26 percent at the end of March), and 36 percent used curbside pickup from a store (up from 19 percent in March).

While your first reaction to this news might be “Duh, we were on lockdown,” you’re not wrong. I mean, restaurants across the country had to close their dine-in service, so the only options were takeout and delivery. The Gallup survey is worth pointing out because data is better than anecdotes, and this study adds to a growing body of market research around our pandemic behaviors.

And sure, stats on increased restaurant takeout might not be too surprising, and the growth for curbside pickup is and will something to keep an eye on. Almost double the number of people are doing curbside pickup now since the beginning of the pandemic. And while Gallup’s poll only breaks out curbside pickup “at a store,” and not specifically a grocery store, the survey’s findings are in-line with other recent research on the growth of online grocery shopping.

A Brick Meets Click survey from earlier this month reported that online grocery sales hit $5.3 billion in April, with 40 million people shopping for groceries online. A Coresight survey also from this month predicted that online grocery shopping will grow by 40 percent this year to hit $30 billion in food and beverage sales.

While takeout and pickup have seen big increases over the past couple of months, delivery hasn’t seen a similar spike. According to that same Gallup survey, 23 percent of respondents had food or pizza delivered from a restaurant in May (up from 13 percent in March), and 14 percent had groceries delivered (up from 11 percent in March).

The bigger question looming over all of this data, of course, is how many of these behaviors will become permanent. As states around the country start to relax their shelter in place orders, we’ll have to see if people revert to the pre-pandemic patterns or have adopted totally new ones.

‘This Is No Time for Champagne and Caviar.’ One Restaurant Owner on How to Reinvent Fine Dining

The understatement of the year is that independent restaurants are going to have a hard time surviving this pandemic. For those that aren’t already closed, the threat of having to do so looms large.

Irena Stein, owner of Alma Cocina Latina in Baltimore, Maryland, isn’t afraid to face that fact. “What are the chances for us to survive truly? Very little,” she said over the phone recently. 

Like any other full-service restaurant, Alma Cocina Latina was forced to close its doors when the pandemic went full swing in the U.S. But instead of completely shuttering the place, as others have done, Stein has transitioned her fine-dining establishment into a hub for two brand-new areas. “Instead of thinking we’re going to close forever, which is a possibility, we’re asking, ‘How can I transform myself into something else?’” Stein said on the phone. The answer, for now, seems to be half-restaurant for takeout orders, half relief kitchen for those in need. 

Alma Concina Latina has been around for five years now. Prior to the pandemic, the Venezuelan restaurant was better known for serving up squash tartare and high-end arepas than it was for filling to-go boxes. In fact, the restaurant has never, up to now, even considered doing off-premises orders. 

“One of the most important experiences for us to share with our guest is the whole experience,” Stein said, adding that Alma Cocina Latina “is a place that is full of education, it’s a very warm environment, very beautiful, accents of museum-type pieces. So for us, coming into our place is coming into our culture.”

Which, obviously, is impossible to replicate in a plastic to-go container.

But like everyone else, state-mandated dining room closures have forced the restaurant to offer some kind of to-go menu, though in it’s not just a case of offering the existing menu in a box. “From a very very beautiful menu we decided to do a few items from appetizers and the arepa bar.” Since arepas are best eaten immediately after cooking, those that live farther away can order theirs half-baked, then follow instructions on the Alma site for finishing them at home.

Takeout is available Thursday through Sunday from 5 p.m. to 7.30 p.m. Users can call the restaurant to place an order or buy items online directly through the Alma site. 

Offering takeout has given some of the Alma staff work to do, but as is the case with many other restaurants, going takeout-only has meant there’s less need for a full staff. Rather than furlough or fire them, Stein and her team started a relief kitchen. 

That’s meant partnering with an organization called Mera Kitchen Collective, which provides a place for refugee chefs to cook. Since Mera was mostly a catering organization before the pandemic, it needed new business, and the two entities teamed up to provide meals to the Baltimore community. Not long after, José Andrés’ World Central Kitchen rang up and offered to sponsor the food they were giving away. Stein told me that as of now, Alma and Mera’s combined efforts, along with the sponsorship, allow them to give away about 450 meals per day. Recipients are individuals with limited access to food who would, under any other circumstance, never have a chance at tasting Alma’s food. 

She noted that Baltimore has a lot of food deserts, and that down the line, she would like to do more work in the area of food justice, such as buying excess food from farmers and redistributing it around the community. 

“I would like to transform part of Alama’s future activities into [helping] food professionals that support different food policies, and then provide the food, really really good food to them,” she said.

As for the restaurant itself, Stein says it will keep doing takeout for now, while they are still in survival mode. She is quick to add, however, that she wants no part in a future that is only takeout. Hence, looking for ways Alma can reinvent the kind of food business it is.

The pandemic has been especially hard on full-service restaurants, and even tougher on fine-dining ones, that, like Alma, have never had a need for any strategy other than dine-in service. But with reduced capacity mandates, stricter guidelines, and decimated savings accounts, the recent reopenings have made abundantly clear that the fine dining industry isnt’ going to boune back from the pandemic full force anytime soon. Possibly never.

“We were a restaurant and we were a beautiful restaurant. That past isn’t coming back anytime soon. Why not think in reimagining the future?”

Stein has taken that as her cue to rethink the point of her business — what full-service restaurants are and, more importantly, what they can do for the larger community. No, that attitude doesn’t lead to immediate profits, or even survival, but it hints at yet-another avenue restaurants can take to let the world know they are out there and still serving up good food.

Or as Stein says, “This is no time for champagne and caviar. Food is food, so let’s work with that.”

DoorDash Will Use Location Data to Make Pickup Orders Speedier and More Socially Distanced

DoorDash announced a new feature today that’s meant to speed up the process for pickup orders and make it more appropriate for these socially distanced times. One catch: the new feature needs your location data in order to do that.

Customers can opt in and share their location data with the DoorDash app, so that as they approach the restaurant, that restaurant can receive an alert and have their order ready to go. The idea is to cut down on the amount of people crowding into a restaurant lobby as they wait for their takeout orders to be ready. In theory, at least, a restaurant could have a designated area of the lobby for pickup orders and place the food there when the app notifies them of a customer’s arrival. 

Of course in order for that to work, people have to be okay with DoorDash having access to their location data while the app is running. I doubt this will be an issue for most customers, given the times. Recent survey data sent to The Spoon by Dragontail found that 73 percent of consumers getting takeout/delivery said they would be “more inclined to order for carry out over delivery if given the option for a contactless experience.” 

The new feature is also a way for DoorDash to originate more takeout orders through its own platform. Third-party delivery has taken much heat (understatement) lately over the amount they charge restaurants in commission fees for delivery orders. More than ever, customers are encouraged to order takeout directly from the restaurant itself so that the revenue from each transaction goes directly to businesses, which need all the help they can get right now. The idea of ordering takeout direct from local restaurants has even been translated into a weekly event on social media.

DoorDash is clearly trying to grab back some of the orders from takeout, and it wouldn’t be alone. At the end of last week, Postmates launched a curbside pickup feature. Grubhub has had a feature for pickup orders in place for some time, too.

Nor is sharing one’s location to make food pickup more efficient just the territory of third-party delivery services. My colleague Chris Albrecht highlighted its benefits in the grocery sector this week when he wrote about his experience with Walmart’s geofencing technology that enables contactless curbside pickup. Geofencing, and location data in general, will “take on more importance as restaurants and grocers look to efficiently maximize their revenues while reducing human-to-human contact.” 

Back in the restaurant world, DoorDash still leads in terms of market share for third-party delivery companies, according to the latest numbers from Edison Trends. That number one spot could be upset, though, if the rumored Grubhub-Uber Eats deal goes through. Edison Trends noted that the combined Grubhub-Uber Eats entity would gobble up 45 percent of the market share — the exact same percentage DoorDash currently holds. The latter’s push to win more takeout orders is no doubt also a move to retain some of that market share in the face of the impending deal.

ChowNow Partners With Instagram for Online Ordering Via Stories

Online ordering platform ChowNow today announced a partnership with Instagram to offer restaurant orders through the social media app, according to a press release from ChowNow.

Participating restaurants that are also ChowNow clients can add an “Order Now” button or sticker to their food images and videos on Instagram. When a user clicks the button, they are directed to the restaurants online ordering platform, which is powered by ChowNow and can process the transaction, including payment. 

One of ChowNow’s big selling points is the commission-free aspect of its online ordering systems. Restaurants partner with ChowNow and pay the company a flat fee to power their online ordering, bypassing the need to use third-party delivery services like DoorDash or Grubhub. That means restaurants focusing on takeout or that operate their own delivery fleet can (in theory, at least), ditch those third-party delivery services, whose commission fees are the subject of much controversy. (Restaurants that drivers would still have to factor in that cost with third parties.)

Small restaurants in dense, urban areas like NYC that don’t need scores of drivers could especially benefit from a system like ChowNow’s. And with the current global pandemic shutting dining rooms down and forcing restaurants to get creative about how they do business, more and more in the industry are promoting the importance of takeout orders.

Whether they’re doing takeout, delivery, or some combination of both, restaurants would be wise to take advantage of the new ChowNow-Instagram partnership. Instagram has become an invaluable marketing tool for restaurants over the last few years. Now, as today’s press release notes, “food images and videos are a mainstay of Instagram Stories.” That’s more true than ever, at a time when people are staying home and people are spending even more time on their devices.

Instagram users will also be able to re-share restaurant Stories that include Order buttons on their own Stories. The new feature is effective today for ChowNow restaurant clients.

NPD Group: Restaurant Customer Transactions Are Down 42 Percent

Restaurant customer transactions dropped 42 percent during the week ending in March 29 compared to the same time period one year ago, according to new numbers from The NPD Group. 

While dismal, to say the least, those numbers aren’t surprising. With most states now mandating restaurants keep dining rooms closed for the foreseeable future, many businesses have lost their primary sales channel. Full-service and casual dining restaurants (think Olive Garden or your local Mexican restaurant) that still rely on foot traffic for the majority of their sales are having to quickly pivot to off-premises models that offer delivery and takeout orders. Restaurants designed for an in-dining room experience are having trouble making this transition smoothly and quickly.

Reflecting that issue, NPD notes that while QSRs (e.g., Wendy’s) saw a transaction decline of 40 percent, full-service restaurants shouldered the burden of a much larger drop, at 79 percent.

“The transaction declines partially reflect the struggle of on-premise restaurants to pivot to off-premise models,” NPD industry advisor David Portalatin said in a statement. “Many restaurants that are attempting to make the move are doing so with limited menu offerings and without the benefit of drive-thru lanes. Anecdotally, some operators are giving up the cause and closing altogether.”

Some of those closures are temporary; others, sadly not. Recent numbers from The National Restaurant Association show that 3 percent of restaurants have closed permanently and another 11 percent are expected to this month.  

Some restaurant-tech companies, like Allset and Presto, have shifted their focus to providing products and services that could make to-go operations more efficient. Others, like Ordermark and Chowly, are waiving certain fees for restaurants that want to get quickly up and running with delivery. Meanwhile, a number of charities, fundraisers, and other initiatives are working to provide relief to impacted businesses and their workers.

It’s too soon to tell how effective any one of these solutions is in terms of saving more businesses in the long term. Given that major restaurant chains as well as the smaller businesses are now struggling financially, even cautious optimism feels naive right now.

For us average consumers who can afford it, the best course of action right now is to keep ordering takeout from local restaurants and contributing to relief funds, virtual tip jars, and other online initiatives. Soon enough, the numbers will tell us if these moves can make a big enough difference.

Allset Raises $8.25M to Improve Pickup Orders

Restaurant tech startup Allset announced today it has has raised an $8.25 million Series B round. The round was led by EBRD with participation from existing investors Andreessen Horowitz, Greycroft, SMRK VC Fund, as well as new investor Inovo Venture Partners. The new round brings the Allset’s total investment to $16.6 million.

Normally, Allset’s tech is meant for the restaurant dining room. Customers use the app to make a reservation and even order and pay ahead for their food, so that it’s ready when they arrive at the restaurant. In 2019, the company added a pickup option for customers, which in hindsight was a wise move, seeing as most restaurants’ dining rooms are currently closed. 

Addressing that fact, Allset recently added a contactless takeout option where customers order and pay online via the Allset app as usual, then retrieve their meals from dedicated pickup shelves in the restaurant. For restaurants who participate in this program, Allset is waiving the normal 12 percent commission fee it normally charges. Customers, meanwhile, get a daily $4 discount for all orders placed via the Allset app. 

Also in the press release, Allset outlined some new features for the app’s redesign, which include personalized recommendations based on a user’s order history, a Healthy Category, which helps users locate healthier eating options nearby, and special deals made in partnership with Allset’s restaurant partners. 

Allset’s ability to quickly pivot from offering efficient dining room experiences to improved takeout orders may be an important differentiator that keeps the company afloat during this unsettling time for the restaurant industry. It’s unclear when dining rooms will re-open or even if people will want to eat in them in the near future. And with the takeout category nowhere near as saturated as delivery, Allset has a good chance of emerging from this time as a leader in terms of go-to solutions restaurants use.

According to the press release, Allset is currently focused on growing in its busiest markets, Los Angeles and New York. The service is also currently available in Austin, The San Francisco Bay Area, Houston, Chicago, Boston, San Jose, Las Vegas, and Miami.  

#TheGreatAmericanTakeout Launches ‘Back for Seconds’ Campaign

Restaurants once again have the opportunity to push their off-premises offerings on social media via TheGreatAmericanTakeout, an awareness campaign organized by Los Angeles-based ad agency High Wide & Handsome and a coalition of restaurant brands including California Pizza Kitchen, Panera, The Habit Restaurants, Inc., Torchy’s Tacos, and many others. Today, U.S. consumers are encouraged to place at least one delivery or pickup order with a participating restaurant as a way of showing support to businesses.

The idea behind the campaign, which started last week, is to use social media to drum up more awareness around how badly restaurants are struggling as states mandate dining room closures to help slow the spread of COVID-19. 

“This is no longer about the survival of individual restaurants,” Russ Bendel, Habit Restaurants CEO, said in a statement about the original campaign last week. “It’s about the future of our industry. And time has run out. Together, we must act to support each other and our communities in unprecedented ways.”

Last week’s online event gave restaurant sales a much-needed boost, if only for a day, while #TheGreatAmericanTakeout was a trending topic on Twitter for much of the day.

Organizers said they would be pushing the campaign again this week and in subsequent weeks.

Whether that’s enough to measurably help restaurants while dining rooms remain closed will depend on how much consumers can be inspired to act when it comes to ordering meals. It’s one thing to generate likes and tweets on social media. Getting consumers to consistently spend on restaurant food each week at a time when layoffs are happening and we’re racing towards a recession might be difficult — though people with enough disposable income to afford said meals should definitely participate. There is also the question of how long the allure of the campaign will hold up over several weeks’ time. Participating restaurants could aid this by offering more incentives for takeout orders in the form of promotions (e.g., free dessert).

Takeout, in particular, is helpful to restaurants right now because they pay a much smaller commission fee (or none at all) per order, unlike delivery orders, where businesses often own third parties 30 percent of each transaction. And as one restaurant chain founder told me recently, it’s also a way for customers to tip the staff making the food, not just the folks driving it to your door.

Customers who order restaurant takeout or delivery today are encouraged to snap a picture of their meal and post it with #thegreatamericantakeout. More details can be found here.  

Prioritizing Takeout is a Big Takeaway From Wahoo’s Fish Taco’s COVID-19 Response

As restaurants temporarily close dining rooms and many struggle to stay afloat, we’re starting to hear from specific businesses about their strategies for dealing with a world where “open for business” means being able to take and fulfill off-premises orders and no one is clear on when they’ll be able to once again open the dining room.  

One such business is Wahoo’s Fish Tacos. Wahoo’s is based in Southern California and currently operates about 60 restaurants across several U.S. states (as well as a location in Japan). The chain was founded by Chinese-Brazilian brothers Wing Lam and Ed and Mingo Lee back in 1988 as a way to bring their different cultures’ culinary traditions and styles together into a single restaurant.

Being around for 30-plus years means the brothers have seen their share of ups and downs in the restaurant industry, which so far is helping them better navigate the sudden and abrupt shift to off-premises business resulting from the spread of coronavirus. 

“We started delivery a week ago because we knew that was coming,” Ed Lee said of the mass restaurant closures that started last week.

During a phone call with me last week, he and Wing Lam explained that Wahoo’s has dealt with having to temporarily close before (after the 9/11 attacks), but that what we’re dealing with now is far more severe. “This is the first time we can’t get ahead of ourselves because everything continues to change,” says Lee.

That’s a polite way of stating the situation. The National Restaurant Association anticipates a $225 billion decline in restaurant sales over the next few months, and the loss of potentially millions of jobs. As mentioned above, entire states are mandating that restaurants close their dining rooms. Major chains are voluntarily shutting down all operations in certain parts of the world. And everything continues to shift so rapidly there’s no telling what the restaurant industry will look like in two days, let alone two weeks.

“Right now we’re looking ahead about two weeks at a time,” he told me. “Our number one goal right now is to make sure we take care of our customers and our employees.”

Wahoo’s is committed to offering delivery (“It is a battle that we’re stuck with,” says Lee). Another strategy that could be more financially beneficial to restaurants and workers is to emphasize takeout, where customers order ahead online then come to the store to collect their food.

The biggest challenge here is actually getting customers to understand the restaurant is still (for now) open for takeout orders. Whereas the vast majority of customers automatically associate quick-service restaurants like Wendy’s or even some fast-casual chains (think Chipotle) with to-go orders, there are many more restaurants in America people still think of as  sit-down establishments. But with 100 percent of orders now being off-premises ones, more has to be done to remind customers the takeout option exists.

Incentives for pickup orders are one way Wahoo’s is doing that. For example, customers who order a family-style meal for pickup and get free desserts as well as a gift card as a reward. There are deals on kids meals for those ordering food for pickup. Lee says the point of these incentives is to get customers to come back to the restaurant, both now and later.

Pickup orders also make more financial sense for the restaurant itself, because the commission fee owed to third-party services like Grubhub or DoorDash is much lower (there’s no driver to pay). Lee is quick to note that Wahoo’s doesn’t want to “get into a war with the delivery system.” That said, he adds that delivery “doesn’t make us a single dime.” Promoting takeout orders is a way around that. 

As an added benefit, it’s also a way for employees making the food to directly receive tips, something that doesn’t happen with delivery orders, where customers pay and tip online and the money only goes to the driver.

Questions around takeout as a business model remain. For now, it’s a viable way for restaurants to offer off-premises ordering and, unlike third-party delivery, connect directly with customers. That could change as the number of COVID-19 cases goes up and more restaurants close up entire operations. And unfortunately, it’s impossible to say right now if a state like California would implement mandatory closures for all restaurant operations, takeout included.    

Lee and Lam said they don’t anticipate seeing full restaurant openings until the end of May at earliest. Until they, they are trying to react to the ever-changing situation as best they can.”

“This is not going to be a tomorrow morning turn the lights back on. It’s going to be tough,” says Lam. “As a community we really need to get our act together and rally.” 

McDonald’s Shuts Down U.K. Restaurants

By the end of the day today, McDonald’s will close all 1,270 of its restaurants in the U.K. in response to COVID-19 concerns. That includes takeout and drive-thru options as well as delivery.

McDonald’s sent the following tweet over the weekend:

McDonald’s franchisees in the UK are expected to follow those moves and close as well. Employees of corporate-owned stores will receive full pay for their hours scheduled through April 5.

Previously, McDonald’s had closed its dining rooms but remained open to fulfill off-premises orders around the world. Today, however, McDonald’s U.K. head Paul Pomroy told the BBC, “Over the last 24 hours, it has become clear that maintaining safe social distancing whilst operating busy takeaway and Drive Thru restaurants is increasingly difficult and therefore we have taken the decision to close every restaurant in the UK and Ireland by 7pm on Monday 23 March.” 

The chain also fully closed 50 locations in the U.S. on Friday, though those stores were part of larger buildings affected by COVID-19, not standalone locations. Still, the sweeping closures in the U.K. could be an indicator of what’s to come Stateside, particularly where takeout is concerned. Over the weekend, Starbucks ended takeout service from its U.S. stores because of the “high traffic” locations were experiencing. The Seattle-based coffee chain was one of the first to close its dining rooms and switch to a to-go model last week, with McDonald’s and others following shortly thereafter. Which could mean McDonald’s is well on its way to axing its own takeaway services in the U.S.

It seems doubtful McDonald’s would get rid of drive-thru or delivery right now in the U.S., given how important those two channels are to overall sales growth. But with news of the coronavirus changing not just every day but every hour and more states taking stricter measures to limit human to human contact, nothing is a given. This is far from the last time McDonald’s, Starbucks, and other QSRs will have to quickly shift strategy in the age of coronavirus.