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Foodservice: New models for restaurants

For restaurants to stay open during the pandemic, they had to rely on delivery and takeout, with contactless curbside pickup a new twist on the latter.

Some operators managed this with ease while others scrambled. A few chains, such as Dog Haus, have launched or expanded brands or items exclusively for off-premises consumption.

Transitioning to takeout and delivery requires menu changes, as some meals can’t be packaged securely or lose their texture during transit. Many restaurants reduced their offerings and some introduced menu items in the form of heat-and-eat or meal kits rather than fully prepared meals.

Chains such as Denny’s, Panera, Noodles & Company, Subway, Taco Bell, Chick-fil-A, Smashburger, and Just Salad explored their options while a Chicago fine-dining restaurant, Fat Rice, closed for good and transformed into a meal-kit provider called Super Fat Rice Mart.

Other operators such as Freshii and Matty O’Reilly’s went all-in on meal kits by launching subscriptions.

More grocerants
Another new business model for restaurants, this one even more of a departure, is selling groceries alongside prepared foods and kits. Brands such as Dog Haus, Panera, Potbelly, Subway, and Dickey’s Barbecue Pit have been among those selling produce, along with meats, spices, and other foods, in-store.

“Operators understand their brand strength, and some had the opportunity to become mini-grocers, selling salad dressing, chicken stock, and boxes of vegetables,” said Lauren Scott, chief marketing officer at the Produce Marketing Association BB #:153708 in Newark, DE.

“It’s a curated selection that fits their brand profile and helps them subsidize sales losses. I think some restaurants will continue to sell off-the-shelf items to deliver more value and ring.”

Many restaurants are also supporting their communities, as well as their own revenue picture, through charitable initiatives. Many are simply giving away food to healthcare workers or families in need due to furloughs. Others are doing good while spurring sales at the same time.

Subway donated a meal to Feeding America for each footlong sub purchased; Urban Plates gave customers the opportunity to sponsor a meal for healthcare workers with a $12 donation and gave away a second meal for each sponsorship; and Dunkin implemented a program where customers could purchase an e-gift card for a first responder, grocery clerk, or other Covid-19 hero.

This is a multi-part feature adapted from the cover story of the July/August 2020 issue of Produce Blueprints.