Restaurant revenue has fallen, despite delivery boom
The graph shows the weekly US restaurants
Source: UBS Evidence Lab
U.S. restaurant revenue declines as take-out and delivery contracts fail to make up for lost sales.
UBS Evidence Lab found that restaurant sales fell 69% for the week ended November 29. In the same week, takeaway sales and delivery increased 59%. However, total restaurant revenues remained in the red.
Industry experts predicted winter would further exacerbate restaurants’ problems during the coronavirus pandemic. Cold temperatures mean fewer customers are willing to eat outside, even if the facility provides heat lamps and blankets.
The winter weather has also spurred an increase in new Covid-19 cases, making consumers more cautious about eating and prompting governors and mayors to impose another round of restrictions on restaurants. New York City has once again banned indoor dining, while Los Angeles has suspended personal dining.
The pandemic has undoubtedly accelerated the shift to food delivery. EMarketer predicts that total third-party digital revenue will more than double this year to $ 44.94 billion.
Investors have closely followed the growth of third party suppliers. DoorDash, which made its public debut in early December, is up 55%. Its $ 50.3 billion market value surpasses that of Chipotle Mexican Grill, Taco Bell owner Yum Brands, and Domino’s Pizza.
However, delivery and takeaway sales won’t be enough to save some restaurants if these sales trends continue. The National Restaurant Association estimates that 110,000 establishments have already closed due to the pandemic. The new Covid bill, passed by Congress late Monday, means restaurants can apply for funding for the paycheck protection program. However, trade groups hope for more targeted help when President-elect Joe Biden takes office.