72% implemented enhanced delivery and online/mobile ordering in response to COVID-19
Off-premise sales has become a key focus for restaurant franchisees in light of COVID-19, according to the 2020 Restaurant Franchise Pulse survey, conducted by TD Bank, America’s Most Convenient Bank. Capacity restrictions designed to implement social distancing and customer concern about physically visiting restaurant locations led to the prioritization of enhanced delivery and mobile ordering capabilities to boost revenue, with 72% implementing this change.
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While 86% of respondents reported having delivery and online ordering prior to the pandemic, which is a 14% increase in delivery since 2019, these offerings now account for a larger percentage of sales, climbing from 20% in 2019 to 39% in 2020. While this spike could be seen solely as a product of the pandemic, restaurant owners see the value of these services long-term. According to last year’s survey, only 12% of franchisees planned to invest in delivery and 25% in mobile ordering in 2020, which has since jumped to 63% planning to invest in delivery and 69% in mobile ordering in 2021 – a 51% increase in delivery and a 44% increase in mobile ordering.
“Franchises have invested a tremendous amount of time, money and creativity in delivery and mobile ordering, but not all restaurants have adapted to off-premise sales to the same degree as the QSR space,” said Mark Wasilefsky, Head of Restaurant Franchise Finance Group, TD Bank. “Providing off-premise sales, which is critical to cash flow, requires having a menu that is amendable to delivery and takeout, which may be more difficult for restaurants that are not QSRs. Fast casual and fine dining establishments need to modify their menus to tasty food that travels well. We expect the shift to off-premise sales to be long lasting, and due to broad consumer acceptance of its added convenience, we believe it will likely become a permanent aspect of many franchises’ business models.”
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