The naysayers who predicted the literal demise of the US restaurant industry post-Covid, especially in fine dining, have been incredibly short-sighted. A new study titled “Agency Forward Restaurant Survey” compiled through Nationwide Insurance, which insures and advises restaurants on how to deal with inflation and chain-of-origin issues, shows that each and every segment of the industry have not only survived, but in many cases are thriving far beyond prehistoric levels of activity. About the findings I spoke with Peter McMurtrie, President of Nationwide Commercial Lines:
You say that reserves are back to pre-pandemic levels. Does this apply to both fast-food chain restaurants (which are usually walk-ins) and high-end, fancy dining?
While this study focused solely on fine-dining restaurants, fast-casual restaurants, and family restaurants, recent studies, as well as our interactions with consumers, have shown that footfall levels at fast-food restaurants and chain restaurants have returned to levels close to those before the pandemic. degrees. However, those corporations face similar demanding situations, such as inflationary increases and shortages in the source chain. But like the other eating place categories we surveyed, many fast food chains and eating places have also turned to third-party delivery to track visitor personal tastes and meet demand.
He says one of the tactics restaurants have responded to is “reducing hours of operation. ” How does it help?
Our study found that 30% of restaurant owners had to reduce their hours of operation due to the pandemic and 19% also did so due to inflation. Recent data from Datassential also showed that restaurants are reducing their weekly hours by 7. 5% compared to pre-pandemic hours, basically due to a shortage of hard labor, decreased demand, and decreased foot traffic during the day and after work due to racing from home. Despite the challenges, many commercial property owners have adapted to the situation, and the relief in opening hours has allowed them to make the most of their resources and generate profits during busy periods.
Pick up your virtual order and listen to the signal for consumers and a variety of food delivery services like Array. [ ] Grubhub, UberEATS and DoorDash, Burger King, Queens, New York. (Photo credit: Lindsey Nicholson/UCG/Universal Images Group via Getty Images)
Do you have any statistics on the development or expansion of delivery/takeaway services?
The restaurant industry has noted a significant shift toward delivery and takeout services since the start of the pandemic: 26% of restaurant decision makers responded that they had added or expanded delivery and takeout and 41% of restaurant customers said they are more likely to use those facilities today than in 2019. 21% of dining venues have also added or expanded delivery or takeout alcohol sales. While those adjustments reflect the conversion of visitor preferences, about a portion of business owners say that third-party delivery services introduce new demanding situations for their businesses. Delivery services, whether directly with drive-thru workers or through third-party facilities, can also create new exposures, highlighting the importance of working with an experienced insurance agent to ensure coverages are adequate.
Do consumers respond to paperless menus or do they prefer paper?
More than a quarter (26%) of restaurants that historically featured paper menus have switched to paperless menus and the use of QR codes during the pandemic due to increased awareness of contactless experiences. More than a portion of restaurant consumers have experienced this shift in the places to eat they visit, with 6 in 10 saying they use their mobile devices to order or pay for their meals. While our smartphones play such a vital role in our lives today, an overwhelming majority of eat-to-eat consumers feel positive about those replacements, and we expect to see continued use of those strategies as they can be a cost-effective and sustainable option for eat-in places.
It says that “about 3 in four restaurant consumers (77%) now rate their restaurant experience as smart or excellent; 67% feel that restaurant cleanliness has improved since the pandemic and 94% are satisfied with this progress. “suggesting that it was a real challenge for consumers in the past. Was the cleanup a challenge?
These findings reflect an increased sensitivity to cleaning and sanitation practices that many industries have experienced as a result of the global pandemic, not just the restaurant industry. As others become more aware of the importance of hygiene in saving and spreading COVID-19 and other health issues, businesses around the world have had to implement new protocols and procedures to ensure the protection of their consumers and employees. Nationwide is working hard to help restaurant owners prioritize health and safety in their establishments with resources and guidance to protect consumers and staff from COVID-19, prevent food contamination in the kitchen, prevent food spoilage and more. Ultimately, restaurant owners (and the agents who serve them) know that the more they prioritize fitness and protection in their dining venues, the better prepared they will be to meet the expectations of today’s consumers. today and expand its activity.
You say that “1 in four restaurant resolution makers list negative reviews as one of their most important risk factors. “How have the restorers tried to mitigate its effect?
A restaurant’s online reputation affects your business in unforeseen ways. A positive online reputation can help drive more traffic to a restaurant, while a negative reputation can have the opposite effect. A strong online reputation can also have an effect on the morale of a company’s workers and their ability to attract new talent. In today’s virtual world, a strong online reputation can not only give a restaurant a competitive advantage, but also monetary merit.
Why and how are restaurants exposed to a “potential cyber vulnerability for consumers by opening new virtual doors to bad actors”?
Cyber protection is becoming increasingly vital for businesses of all shapes and sizes as they rely on technology to serve their visitors. In the restaurant industry, the increased use of mobile payment and point-of-sale systems, paperless mobile ordering and menus, and even Wi-Fi access for visitors can make them prime targets for cybercriminals, especially as the Most cyberattacks target small businesses. Our September 2022 report also revealed that three-quarters of consumers would prohibit doing business with a company guilty of a cyberattack that As restaurants continue to process payment and other sensitive visitor data, it is vital that they take precautions to protect this data and purchase cyber liability insurance to assist them in the event of an attack.
Due to inflation, restaurants have had to lower their prices. Was there resistance from customers? Is customer spending increasing?
Although restaurant customers are feeling the pressure of supply chain shortages and inflationary price accumulation (56% of them report an increase in restaurant fees/service fees since the start of the pandemic), this is not slowing customer confidence. Twenty-seven percent of customers told us they visited places to eat more than before, and 77 percent now rate their dining place experience as smart or excellent. Tips also remain high, with few customers reporting fewer tips compared to pre-pandemic consistent with the period (13%) and a year ago (12%). However, we’re seeing a trend of customers cutting back to save money by visiting less expensive eating places, opting for less expensive menu pieces, or ordering fewer pieces by check.
You report that “Despite challenges, over 8 in 10 (82%) restaurant decision makers say they are doing better financially than expected. Nearly 3 in 4 (72%) report an increase in their restaurant’s revenue over the past six months, and more than 9 in 10 (93%) also anticipate revenue increases in the next six months.” Do these increases make up for higher costs of running?
Restaurant decision-makers are feeling positive considering the current monetary scenario and expected profit increases in the coming months. 44% of decision-makers even say that the pandemic has had a positive effect on their restaurant’s finances. But this positive attitude doesn’t mean they can avoid making complicated decisions. In the face of inflation, supply chain shortages, and staffing issues, there are still hurdles to overcome, and they differ depending on the category of the place to eat. For example, earnings reports show that margins for full-service eating places are shrinking, while margins for fast food and fast food eating places are increasing. Restaurant owners will need to continue to seek the right balance between price increases and menu adjustments, keeping the visitor and their profits in mind. This will be a continuous challenge until the national economic scenario stabilizes.
You state that “More than three-quarters (77%) contact an insurance agent to manage their insurance desires and turn to them for advice, as nine out of 10 decision-makers have contacted or plan to contact their insurance agent in the coming years. six months. talk about policies, while about 3 in 10 plan to minimize policies/limits (32%) or some type of policy (30%). What kind of policy are they looking for?
Many conservatives work with their agents to set policy limits that take into account higher asset values as appliance and repair/replacement prices rise due to inflation. Other aspects, such as increased payroll and sales, are also factored into your insurance grades and premiums, adding reimbursement from your painters and general liability policies. Therefore, it is vital that their agent helps them ensure that their protection meets the wishes of their business. As pricing pressures take their toll on restaurant owners, many are also looking for tactics to reduce their operating prices. To save on insurance premiums, we see restaurant owners looking to qualify for higher deductibles or reposition terms and situations and take on more responsibility. But before canceling any insurance policy, it is imperative to work thoroughly with your insurance agent to make sure your policy is good enough for the risks you face. The lack of a policy can be fatal for a business if it suffers a loss and does not have safeguards in place to protect its business and livelihood.
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