The Struggle is Real for U.S. Full Service Restaurants as Visit and Transaction Declines Stay in the Double-Digits

But the silver lining is the opportunity to transform by offering both dine-in and off-premises services

Chicago, July 30, 2020 – Full service restaurants (FSRs) were still recovering from the Great Recession, which ended over ten years ago, when the COVID pandemic hit along with shelter-at-home orders and mandated dine-in closures. With most of FSR business being on-premises dining, these sit down, table service restaurants were hit hard. Visits to FSRs were down -47% in the April, May, and June quarter, the height of the mandated dine-in closures, compared to same quarter year ago, reports The NPD Group.  Quick service restaurants (QSRs), which already have developed off-premises operations like carry-out and drive-thru, realized a traffic decline of -17% in the same quarter.  

In February 2020, before COVID, only 19% of FSR traffic was for off-premises consumption, and in June, even as dining rooms were reopening, off-premises was 55% of FSR traffic. The transition to an off-premises business during the mandated dine-in closures has been a challenge for FSRs. Some FSRs, particularly FSR chains, were able to quickly pivot by ramping up delivery programs, repurposing their parking lots as temporary drive-thru lanes, and streamlining their menus for more efficiency, but the shift to off-premises was both difficult and costly. However, without a significant shift to off-premises, major FSR chain customer transactions, which declined by -27% year-over-year in the week ending July 19, would be worse. In June, FSR off-premises traffic increased +91% versus year ago while on-premises traffic declined by -62%. That stated, consumers still value the on-premises experience and it’s evidenced by the fact that FSR traffic increased 152% in June, and 69% of that increase was due to the return of dine-in traffic. 

“Long before COVID consumers were already favoring quick service restaurants and off-premises dining, and this trend has accelerated during the pandemic and will most likely be a behavior that will stick,” says David Portalatin, NPD food industry advisor and author of Eating Patterns in America . “For full service restaurants it will mean more flexible operations, delivering on the on-premises experience and optimizing off-premises services. I see this as a sea-change for the U.S. restaurant industry.”


Stay current in your industry
SUBSCRIBE

Press Contact

Kim McLynn
847-692-1781
kim.mclynn@npd.com

@npdfood

The NPD Group, Inc.
900 West Shore Road
Port Washington, NY 11050

Want more?

Complete this form to hear from NPD.


Newsletter

Subscribe and get key market trends and insights relevant to your industry each month.

We will not sell your information. View privacy notice. | Cookie Settings

Follow Us

© 2020 The NPD Group, Inc.