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Showing posts from May, 2022

US restaurant and foodservice sales will finally exceed the 2019 level

US consumers are spending more on high-end hotels and restaurants, according to the American Express first-quarter report ( Demos, 2022 ). Reservations in the company’s Resy restaurant-booking service jumped 16% from February, making March the busiest month ever for Resy.     The NRA projected sales at $898B in 2022.   The National Restaurant Association (NRA) released the 2022 State of the Restaurant Industry report earlier ( Ruggless, 2022 ). NRA projected that total restaurant and foodservice sales would reach $898 billion, slightly exceeding the $864 billion level in 2019. In 2020 and 2021, the industry reported annual sales at $678 billion and $799 billion, respectively. Although, after adjusting the inflation, foodservice sales in 2022 would still remain 11% below the pre-pandemic level, such a growth shows a very healthy trajectory for the industry.     The pandemic has substantially changed restaurant operations.   The 2022 State of the Restaurant Industry report ( NRA, 2022 )

Hotels need corporate and group business this summer for a full recovery

Business travelers made up 52.5% of the room revenue for the hotel industry in 2019. Such a number was projected to hit 43.6% only, according to the AHLA’s 2022 State of the Industry report ( AHLA, 2022 ). That is a $21 billion gap (estimated $69 billion in 2022 vs. actual $90 billion in 2019) ( Tanzi, 2022 ). The recovery of the lodging industry is primarily driven by leisure travelers now, some of whom have become the new “bleisure” (business + leisure) travelers.     NYC’s business-travel revenue gap between 2022 and 2019: -$2.5 billion     Traditionally, metropolitan markets were the top destinations for corporate events and large conventions, but that was also the sector that got hit the most by the pandemic. The work-from-home trend could possibly encourage more bleisure travelers to stay/work in a hotel for a stretched weekend. Still, bleisure travelers are different from those attending large corporate events or conventions. They do not need any boardrooms or convention spaces

Demands for air travel are up this summer, but can the airlines handle it?

“ The demand that we’ve seen over the last five weeks has been historic. We’ve never sold more tickets in any period in [our] public history .”   --- Ed Bastian, CEO of Delta Air Lines (April 2022).   Have you booked a ticket for summer travel already? You might regret it if you have not done so yet. I was shocked to see that the ticket I tracked from the greater L.A. area to Orlando in June had gone from $300 to $1,200 in just a few weeks. As a reference, I could usually find a round-trip economy ticket between L.A. and most destinations in Europe and Southeast Asia for $600 - $1,000 before the pandemic.     It’s not just the price; the pace is picking up too.   American Express just released its first-quarter report ( Demos, 2022 ), showing that American consumers are fueling the recovery. Large corporate travel spending or international consumers, however, have not yet resumed to the 2019 level. Here are a few highlights:   Americans spent 20% more on travel & entertainment (T&a

Do you have plans to make curbside pickup permanent?

The concept of buy-online-and-pick-up-in-store (also known as “BOPS”) is not new. The pandemic just pushed more restaurants and consumers to use mobile ordering for curbside pickup services.     Curbside pickup is good for business   When COVID hit, many restaurants might have used curbside pickup simply to cover the loss from their dine-in services. It turned out that restaurants offering curbside pickup during the pandemic fared better than those without such a service.     It did not take long for restaurant chains to realize the benefits of curbside pickup. Panera Bread, Burger King, Shake Shack, and Taco Bells are among the first chains that rolled out new store design plans to embrace curbside pickup. Chipotle even introduced a digital-only restaurant that only offered delivery and curbside pickup services without a dining area. Using Chipotle’s digital-only restaurant as an example, the owners can:   Open the business in a less premium retail location with a lower startup cost