The Dine-In experience: still the heart of the restaurant industry

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How do we define what is and is not a restaurant these days? It’s a simple question, but difficult to answer. Industry professionals and consumers could debate this for days and never reach consensus; a point proven by looking at the definitions of several dictionaries.

When I turn to my old-fashioned but faithful 2001 edition of Webster’s Desk Dictionary, I find a very simple entry: an establishment where meals are served to customers. Fast forward to a contemporary resource on Dictionary.com, and the definition is the same. Webster’s most recent definition found online says: Commercial establishment where meals or refreshments can be purchased. Cambridge? A place where meals are prepared and served to customers. What about Oxford? A place where people pay to sit and eat meals that are cooked and served on site. I could cite additional sources, and the result would be a compilation of nuances that fuel the debate.

If the more general definitions from textbooks were applied, the list of qualified restaurant establishments would extend deep into the retail world. Virtually every convenience store, grocery store, and cafeteria would make the list, as would any stores that sell food within their walls. Each food truck, snack stand and kiosk wins a place.

Why is all this important? Because to answer the question of whether dinner is “dead” we have to consider the universe in which the dinner experience resides.

This is where the challenge lies: reaching a consensus on what a restaurant is. is. Some would say that a dining experience is at the heart of a restaurant. If you don’t prepare and serve a meal to a guest on site, then you are … well, something other; maybe the close relative of a real restaurant, or maybe a distant cousin. But not an authentic restaurant.

I find merit from this point of view. The kitchen may be the engine, but it is the dining room where you can feel the pulse of the business; where we see satisfaction on the faces of our customers; satisfaction derived from good food and the value of fellowship, not only among diners at the table, but with those who serve them. This is where we find the real heart of the business; where we experience the joy and pride in providing delicious food and genuine service.

Yet, at the same time, our industry has evolved in a way that has distanced restaurateurs more and more from the classic restaurant experience. The history of evolution spans decades and there are many variations of restaurants that we find in today’s market. A multitude of factors are behind these changes. The pandemic has punctuated evolutionary history, but luckily it does not resemble an extinction event. The restaurants and dining experience that defines the industry more than anything else, haven’t followed the dinosaur’s path.

It is too early to predict whether a post-pandemic world will lead to the release of pent-up demand coupled with a renewed appreciation of the restoration experience. At the start of the pandemic, some predicted exactly that and clung to the idea that we would have a makeover from the ‘roaring twenties’ of a century ago. But a lot of time has passed, and as pandemic weariness gnaws at us, we seem to hear less and less of such prognoses.

There is a fascinating aspect to all of this, thanks to the pandemic. At its lowest point, the catering business was almost faded away. Almost zero. To survive, many restaurants have had to reinvent themselves, at least temporarily. Many have borrowed from their siblings’ playbooks from outside the restaurant community, including the world of grocery stores and convenience stores.

And now the traditional community is rebuilding itself; rising to the point that it would likely have fallen without the intervention of the pandemic. Before 2020, there was arguably too much catering capacity compared to demand. The traffic numbers and average unit volumes for casual dining brands and independents were dropping, but new restaurants kept appearing, which cut the pie into smaller and smaller slices. The pandemic has changed that. The opportunity now exists for a reset when it comes to restoring health to the world of traditional dining and the dining experience.

If I were a full-service restaurateur I would love to think the segment was heading for a renaissance. Granted, there is a lot of talk within these circles about how their fortunes relate to retention and even the growth of offsite business in the months and years to come. But if I was on their side, I would place my bet on the winners being those who excel at delivering the elements of a customer experience that are the heart of the restaurant – in the dining room.

But what about the dining experience for fast and casual food brands in the post-pandemic world? Each brand is confronted with the evaluation of the role that the restaurant-restaurant plays in its future; a single strategy is not in the cards. Some fast-casual brands will be looking at a post-pandemic revival in their dining rooms; the nature of their cuisine and the culture of their brand will lead them in this direction. On the flip side, brands that have been disproportionately successful in growing their offsite business are likely to double that success.

To date, it does not appear that the increase in restaurant activities observed during the rebound in casual dining is coming at the expense of off-establishment transactions. This is not to say that a brand cannot aggressively seek to expand its business to both offsite and in the restaurant, but my prediction is that most brands will assess their opportunity as being stronger in one area or the other and invest their resources accordingly.

Will some brands all give up dinner together? It is possible, but I think it will be rare. Even though their on-site restaurant business has been in decline in recent years, most brands don’t allow themselves the luxury of summarily dismissing a double-digit portion of their average unit volume. Some operational benefits can be realized, but this is unlikely to produce enough savings to offset the contribution margin generated by the catering portion of the business. Operators may experience a paradigm shift and view their restaurant business as generating the cream of their profitability, even if it represents a proportionately smaller percentage of their overall sales.

Ultimately, I think the industry will reach a new, healthier point of balance. It’s hard to name many positives that stem from the pandemic, but one of them just might end up being the opportunity to hit the reset button, and a better dining experience can directly result. . Our industry will be better off for it.

Don Renard is CEO of Firehouse of America, LLC, where he leads the strategic growth of Firehouse Subs, one of America’s leading fast and casual food brands. Under his leadership, the brand has grown to more than 1,190 restaurants in 46 states, Puerto Rico, Canada, and non-traditional locations. Don sits on various influential boards in the business and nonprofit world, and is a respected speaker, commentator and author. In 2013, he received the prestigious Silver Plate Award from the International Food Manufacturers Association (IFMA).


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