A challenging year for the restaurant space is ending just as it began: with waves of new COVID-19 infections threatening the outlook as vaccine mandates, labor shortages and inflation make tough service sector jobs even harder.
Yet Krystle Mobayeni, the CEO and founder of restaurant website platform BentoBox, told Yahoo Finance that the Omicron wave has not deterred the embattled industry. Restaurants continue to “get creative” to battle the surge, she insisted, and are using the pandemic to deepen their connection to customers.
The executive cited one recent example of a restaurant that was forced to shut down due to a COVID-19 exposure case. But instead of remaining idle, the eatery pivoted to creating Christmas meal kits in order to earn some additional revenue.
It’s a sign of the times as restaurants continue to learn from pandemic hurdles — with many shifting operations to digital channels and online ordering to stay afloat.
Mobayeni noted that clients of BentoBox have seen a 10% increase in online order size week-over-week, with hard hit states like New York and Illinois seeing order volumes increase by as much as 15%.
Overall, direct online order volume has surged a whopping 54% year-over-year, as COVID-wary customers rely more on takeout and delivery.
According to BentoBox’s data, restaurants saved $38.5 million in commission fees by switching to direct online ordering — rather than relying on third-party delivery apps like Grubhub, Doordash (DASH) and Uber Eats (UBER).
“I do think that there is a change happening in consumer behavior,” Mobayeni said, explaining that consumers now want to have “a relationship with the restaurant” even if they don’t dine in.
“Diners are starting to go directly to the restaurants’ channels and contact the restaurant directly. This direct relationship is becoming a much more permanent fixture because just it’s something that consumers are wanting,” she added.
Smaller restaurant chains that may not have the brand recognition or exposure to go up against big-name delivery apps, have utilized automation tools like social media and promotional e-mail campaigns to create better relationships with consumers.
Other creative moves include the rise of ghost kitchens — operations with no wait staff, no dining rooms and no parking lot. The new concept (up 100% on the BentoBox platform) helps restaurants meet demand with less overhead as prices continue to surge and supply chain issues persist.
“This became a lot more prevalent in conjunction with rising operating costs, so restaurants [were] forced to find new efficiencies,” Mobayeni said, surmising that the concept will continue to be popular in 2022.
Labor shortages persist
Yet labor shortages continue to pose the biggest challenge for beleaguered restaurants.
According to the latest BLS report, jobs the foodservice industry have crept up, but have not yet reached pre-pandemic levels. Currently, the industry is more than 750,000 jobs short compared to March 2020.
Mobayeni warned t the labor shortage is “here to stay,” and noted that restaurants have had to pay more to attract new hires and retain staff, with labor costs rising by an eye-popping 80% – 85%, she said.
Still, automation continues to be key with more restaurants allowing technology to handle operating tasks — “a trend that we’re going to see moving forward in 2022,” the CEO added.
Alexandra is a Producer & Entertainment Correspondent at Yahoo Finance. Follow her on Twitter @alliecanal8193
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