Will your neighborhood restaurants still be there when the Covid-19 pandemic ends? It’s likely you already know of eateries in your own hometown that have shut down for good in the past year.
As of Dececember 1, 2020, nearly 17% of U.S. restaurants were “closed permanently or long-term,” according a recent study by the National Restaurant Association. That translates to over 110,000 service-industry businesses across the country that are never coming back.
“The restaurant industry simply cannot wait for relief any longer,” Sean Kennedy, the association’s executive vice president of public affairs, wrote last month in a letter to Congress. “What these findings make clear is that more than 500,000 restaurants of every business type — franchise, chain and independent — are in an economic free fall.”
The combination of many Americans opting to eat at home and widespread indoor dining restrictions across the country has devastated an industry that ended 2020 with total sales $240 billion below the association’s pre-pandemic forecast.
Nine in 10 (90%) restaurant owners say the pandemic is the biggest threat to their business since opening and more than half (56%) have seriously considered closing for good, according to a new study from American Express.
The vast majority of (93%) Americans understand that the Covid-19 pandemic has created a dire situation for restaurants, and nearly eight in 10 (79%) say they feel a personal commitment to support local independent restaurants in the wake of the pandemic, per the study.
For restaurants that have managed to stay solvent so far, it’s likely that takeout orders have made the difference. On average, restaurant owners say that 62% of their current sales are from takeout orders, according to American Express research. A whopping 89% of restaurateurs say takeout orders have helped them stay afloat during the pandemic.
“Being able to expand into takeout and delivery has helped our business immensely during the pandemic,” said Kim Hoang, Owner of Di An Di in Brooklyn, New York. “Our takeout business has allowed us to grow our customer base and feed even more people during this difficult time.”
But it’s still a steep hill to climb. Small restaurants need at least 52 takeout orders a day, on average, to make ends meet, per the AmEx research. Currently restaurants report an average of 40 takeout orders a day, which is 23% too few.
American Express estimates that the simple act of ordering takeout can generate, on average, more than $700 million in daily sales for independent restaurants, based on average takeout sales per restaurant and the total number of small restaurants in the U.S.
A simple way to help save your local restaurant industry is to order in for lunch on a regular basis, says AmEx. Remote work has killed lunchtime takeout orders across the country, with 81% of restaurant owners reporting a decline in lunch business since the start of the Covid-19 pandemic.
Americans currently order takeout for lunch just once a week, on average, compared to twice a week prior to the crisis. The number of consumers who say they ordered takeout for lunch at least once a week has dropped from 73% pre-pandemic to 60% during the pandemic.
To help save more independent restaurants, American Express and Resy have teamed up for the “Order In, Help Out” campaign to make Takeout Tuesday a weekly occurrence. The initiative is an extension of American Express’ “Shop Small” effort to support small businesses.
The rationale: By ordering takeout on Tuesdays, one of the slowest days of the week for restaurants, everyday Americans can help their hometown cafes and restaurants survive the pandemic.
“When customers order takeout from an independent restaurant, they are truly helping to keep the doors open and lights on,” said Karen Akunowicz, chef and owner of Fox & The Knife in Boston.
To help encourage AmEx card holders to order takeout, American Express is introducing some new dining offers through the end of 2021. Eligible Delta SkyMiles, Hilton Honors and Marriott Bonvoy American Express card holders can enroll in an offer to earn up to $220 in statement credits at U.S. restaurants, whether they dine in or take out. Additionally, American Express Green Card holders and Gold Card holders in the U.S. are already able to earn three and four times membership rewards points, respectively, on restaurants including takeout and delivery.
Resy is providing 100% relief to restaurants on all fees and billing through June 30, 2021.
American Express methodology: Consumer responses are from a survey conducted online January 11-16, 2021 of 1,004 Americans who visited a restaurant 2+ times a month before the Covid-19 pandemic. Restaurant owner data is based on an anonymous survey conducted online January 8-18, 2021 among 500 owners/managers of independently owned restaurants with fewer than 50 employees across all locations.