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U.S. restaurants to lose $240 billion this year

restaurant losses due to covid
The foodservice distribution industry collectively experienced more than $12 billion in uncollected debts as restaurants and other facilities shutdown in response to the global pandemic and were not able to pay their distributors.

The produce companies supplying restaurants in 2020 lost customers for several months, and even with foodservice opening back up, this year will be a horrible one financially.

Even when restaurants are allowed by local governments to reopen, many aren’t because of a lack of demand.

The National Restaurant Association reports the restaurant industry lost $120 billion in sales from March to May and is predicted to lose $240 billion in sales by the end of 2020.

In a survey of its members across the country from May 15-25, NRA found that 75 percent of operators say it’s unlikely their restaurant will be profitable in the next six months.

While most states are allowing restaurants to open their dining rooms to customers, many are not by choice. At the time of the survey, 27 percent said they remained temporarily closed.

According to the survey for restaurants that are temporarily closed:

  • 55 percent say there aren’t enough customers to reopen;
  • 47 percent say it’s too soon for public health;
  • 31 percent say social distancing isn’t in place;
  • 23 percent say there aren’t enough employees; and
  • 17 percent say it’s within the 8-week PPP loan period.

Greg Johnson is Director of Media Development for Blue Book Services