The future of restaurants and food businesses in a Post- COVID-19 World
By Sanjana Jain
COVID-19 has put the Rs. 75,000 crore restaurant industry growing at 7% in a lurch. Restaurants are getting a very low footfall despite following social distancing after lifting of the lockdown in India. Colleges are closed, offices and businesses operating at half their capacities, and as a result restaurants and eateries are finding it unviable to open. They are waiting for the right time to get started again with dine-in services. Food joints which used to be a popular hangout and dining areas for families and the young crowd are now shut. While people want to socialize, the fear of infection if they step out of their houses, holds them back. Most of the people are thus opting for home deliveries, pick-ups, drive throughs, and curb side pick-up.
World over, restaurants are facing a crisis. Many restaurants in the National Capital Region and Delhi are closing down. They are finding it unprofitable to operate with such few customers. Sharing of food is an integral part of Indian culture but today people are less likely to eat from one tiffin or share a dish in the restaurant. Even when people dine out, they are likely to opt for single portions. Buffets in 5-star hotels are unpopular, at least for the time being. ‘Big fat Indian weddings’ have become small family affairs.
It is important to note that COVID-19 is a virus that causes respiratory, not gastrointestinal illnesses. Although, there is no possibility of coronavirus being transmitted through food, there is a risk of human transmission of the virus while food is being handled. Thus, the food regulator in India, namely ‘FSSAI’ has issued detailed guidelines related to hygiene and safety to be followed by food business operators. This includes maintaining a high level of personal hygiene, practicing social distancing, excluding COVID-19 infected persons from operations, and carrying out proper cleaning and sanitization of food operation premises. On top of this, restaurants have a stupendous task of building customer confidence. They are also working long hours chopping, cooking, and serving to follow the ‘Good Hygiene and Manufacturing Practices’ prescribed by the FSSAI. Some restaurants are adopting additional hygiene measures like sanitizing their kitchens every hour, taking employee’s temperature every day for screening, and packing food in tamper proof bags.
With restaurants and hotels facing a tepid response, cloud kitchen, ghost restaurants, delivery kitchens, virtual restaurants are increasingly becoming popular. The online food delivery market is projected to grow tenfold in the coming decade in India. These kitchens take online orders and use online food aggregators such as Swiggy, Zomato, Food Panda or other mobile apps to accept orders, and charge 18-20% of the revenue per order. However, for restaurants it is also essential to have a single point of sales software that can accept orders from various sources as well. There is also a one-time integration fee involved for some Foodtech companies. For starting a cloud kitchen, a license from FSSAI is also required, along with a GST registration and a NOC from the fire department.
In spite of these stringent requirements, home deliveries by reputed brands will continue to be popular in the future. People are likely to enjoy the food from their favorite restaurants in the ambience of their homes. Local vendors and food stands will probably be replaced by the neighborhood auntyji who can cook chaat in small batches and deliver fresh, clean food. While there are no laws for home cooking, it is expected that hygienic practices will be followed.
Restaurants will also have to increasingly invest in contactless deliveries and develop delivery specific menus. Ecofriendly, plastic free innovative packing will be necessary to create an impression of hygienic practices followed by restaurants. At the end of the day, however eating out is a social exercise, and however much we want, social distancing will be difficult to practice while dining- in. Therefore, takeaways and home deliveries are going to rule the roost. In the coming few years, restaurants will have to change business strategies, keeping in mind the current pandemic. They will have to reduce the prices of food if customers are not dining in because you cannot expect them to pay the same for a lesser experience and also considering that they have become more frugal during COVID-19. The future of restaurants and food businesses in a post COVID-19 world will be an interesting evolution to observe.