When Will Restaurant Traffic Get Back to Normal?

Mish

Judging from reservation bookings, the reopening of restaurants in a handful of states did not result in a flood of traffic.

Eight states opened up or partially opened up restaurant operations on May 1 or earlier according to the New York Times.

States Reopened for Restaurants 

  • Alaska: April 24
  • Florida:Traffic May 4 -25%
  • Georgia April 24
  • Indiana: May 11 - 50%
  • Iowa: May 15
  • Kansas: May 4
  • Missouri :May 4
  • Montana: May 4
  • Nebraska: May 4 -50%
  • Nevada: May 9
  • North Dakota: May 1
  • Oklahoma: May 1
  • South Carolina: May 11 - 50% 
  • South Dakota: Never Closed
  • Tennessee: May 1
  • Texas May 1 - 25-50% by location
  • Utah: May 1
  • West Virginia: May 4
  • Wisconsin: May 13: By Supreme Court Ruling 

States May 1 or earlier: Alaska, Georgia, North Dakota, Oklahoma, South Dakota, Tennessee, Texas, Utah

Open Table

OpenTable tracks sit-down diners at 20,000 restaurants and it also providers downloadable data from which one can produce charts. 

The data indexes two things: first, overall impact of Covid 19 on the industry by showing year-over-year seated diners at a sample of all restaurants on the OpenTable network across all channels: online reservations, phone reservations, and walk-ins; second, how the industry rebounds as markets reopen by showing restaurants re-opening rate multiplied by their fill rate as compared year-over-year.

For year-over-year comparisons by day, we compare to the same day of the week from the same week in the previous year. For example, we’d compare Tuesday of week 11 in 2020 to Tuesday of week 11 in 2019. Only states or metros with 50+ restaurants on the OpenTable network for 2019 or 2020 are included in the sample. 

To better reflect the state of the overall industry, this dataset is based on a sample of approximately 20,000 restaurants that provide OpenTable with information on all of their inventory. This sample of restaurants typically accounts for a majority of our seated online reservations.

Of the 8 states open May 1 or earlier, OpenTable tracks Georgia, Oklahoma, Texas, and Utah. Tennessee. 

Global Restaurant Traffic  

Reataurant Traffic Year-Over-Year Global 2020-05-14

May 14 Global Synopsis  to Nearest Percent

  1. Global: -96%
  2. Australia: -99%
  3. Canada: -100%
  4. Germany: -92%
  5. Ireland: -99%
  6. Mexico: -99%
  7. United Kingdom: -99%
  8. US: -95%

May 14 US Synopsis to Nearest Percent

  • US: -95%
  • Georgia: -88%
  • Oklahoma: -79%
  • Tennessee: -85%
  • Texas: -83%
  • Utah: -88%

Trends?

Several people on Twitter projected the states' percentage trendlines to get back to 100% but such projections are not close to reasonable.

Rules are subject to change every day and so are consumer concerns. 

That aside, it is sure to be a long slog nationally. 

Some states will not open until the end of the month or even June. And the percentages of traffic allowed varies by state and even county. 

Perhaps traffic gets back to 75%-80% by the end of the year.

Consumer balance sheets have been so damaged and social changes disrupted so much that full recovery this year is highly unlikely.

No V-Shaped Recovery

As noted on Friday, Retail Sales Plunge Way More Than Expected

Even the fed understands there will not be a V-Shaped recovery.

Instead they are promoting a helicopter drop of money. For details, please see Panic Sets In: Fed Promotes More Free Money

Mish

Comments (57)
No. 1-24
Quatloo
Quatloo

Interesting, I think people have a higher level of concern at restaurants. It takes momentum to change people’s habits, and obviously some percentage of people are not going to go back until they have received an FDA-approved vaccine. There certainly is no shortage of people in the retail stores that are open, from my own anecdotal observations.

JohnB99
JohnB99

The restaurant industry is easily moldable to consumers.

Once a trend begins, that makes consumers feel safe to go out, they will. Whether it's plexiglass partitioning, robotic food delivery systems or operational changes like more food trucks, portable kitchen operations...something that keeps consumers feeling safe will catch on and explode....one day

numike
numike

I will NOT be going to any Cracker Barrel (or similar) eatery. They are frequently very crowded with overflow groups waiting outside for a table especially 10/11 am Sunday (the church crowd)

Rusty Nail
Rusty Nail

The only way it gets to "perhaps 75-80% by the end of the year" is if there is no second wave of infections before January 2021. That seems extremely unlikely to me.

thimk
thimk

recovery might depend on the location of the establishment . If the restaurant is in a high risk contagion area the slower the customer rebound . Mom's and pop's will probably fall off the vine . They don't have access to capital like the big chains . And
they won't be able to recapture/absorb the additional costs of safety plus 1/4 capacity restrictions.

Sechel
Sechel

20% maybe more of New York restaurants don't expect to reopen. It may make for good health policy but 50% occupancy is not a viable business model for the restaurant industry.

Anda
Anda

I don't see 80%, maybe 50% in a years time. Half the population are ready to "mingle" , the other half not, and not for a long time.

Then there is tourism, which must make up a large part of dining out because tourists are more or less obliged to. That will not take off any time soon, airlines are talking of starting a small framework of international flights next month, but that is tentative and not your usual tourism. I expect some will be itching to get away over the summer, many not, depends on how contained the virus is plus what restrictions are in place such as quarantines which now exist. I reckon most people book or at least plan well in advance, and if they are uncertain now most aren't going to head off at a moments notice over summer because they just lifted restrictions - figure if someone catches the virus they are as likely going to have to be in the hands of local healthcare rather than return home.

Apart for the owners and employees, I don't see a need for dining out to rush towards previous levels, would be a shame to see some places close though and a lot of local makeup or mood comes from them.

TimeToTest
TimeToTest

Me thinks that since the consumer is already in preparation mode for a recession(saving money) traffic will stay at depressed levels for the foreseeable future.

At this point I think the virus is number 1 but the fear of job losses and economic unknowns will slow peoples money spending habits all the way around.

Restaurants are the #1 place people can save money. Eating out will go from a normal night to a special occasion.

People stopped going to restaurants before the lockdown. They expect a recession and are getting their house in order. Recessions like this are a self fulfilling prophecy.

FromBrussels
FromBrussels

...to answer your question Mish ;NOT ANY TIME SOON, while ClintonNN and other democrat news outlets keep on brainwashing people that going to restaurants is VERY dangerous....

davebarnes2
davebarnes2

September 7, 2021
You can take that to the bank.

Casual_Observer
Casual_Observer

Things will improve this summer.

Casual_Observer
Casual_Observer

Mish . You need a post on the senate flipping to the Democrats this year. It could easily happen. Additionally Texas is now in the tossup category for the presidential election. The Republicans are in real trouble unless they interfere in the elections. It looks like a private equity company now owns the companies that make election equipment. That alone should strike fear into voters.

BrainDamagedBiden
BrainDamagedBiden

There is no way around it, a lot of service businesses are going to have a tough go of it, no matter what the policy. However, over time the hysteria will die down and things will pick up. Still the worst way to go about it is a government goon, total lock down.

I think many experts think herd immunity is the primary way out of this. There has never been a vaccine for a Coronavirus so that hope is small. Also, what are the side effects of such a vaccine? I don't want to take it,or at least not right away. We can hope the summer kills it off, but, not likely.

The real motivation for controlling people's behavior is to keep healthcare from being overwhelmed. But the flattened curve (with an economic shut down) is running at a rate of about 20,000 new cases per day. At that rate, herd immunity is developed in 20+ years. If instead, only those at high risk self quarantin and the healthy get back to normalcy, herd immunity can be achieved much quicker while keeping healthcare from being overwhelmed.

Tony Bennett
Tony Bennett

Survivor Bias

Many restaurants (25%?) will close ... forever. However, their customers will "survive" and will migrate to restaurants still open ... creating a bump for them ... and thus Survivor's Bias ... those still standing will benefit ... maybe not back to normal, but better considering competitors wiped out.

Look for chains such as McDonalds to benefit ... and just as surely for Bulltards to trumpet ... all the while ignoring Total restaurant sales.

Maximus_Minimus
Maximus_Minimus

When will I go back to a restaurant, you asked? When they invent a facemask with a mouth hole, and invisible earplugs, so I don't hear the roaring noise from all the diners trying to outscream one another - for a genuine dining experience.

I use the pandemic as an excuse for many things I wanted to do anyways, including avoiding restaurants.

Jakefromstatefarm
Jakefromstatefarm

I'm never going back to a restaurant. Why pay $70 (with tip) for a burger and a couple of beers for the two of you when you can buy a good steak and a decent bottle of wine for half that. We bought clippers for dog grooming and another for haircuts. Not using those services again. They want to illegally lock us in and close tax generating businesses, OK. EFF em. I'm reducing my income as much as possible so we can jump on any govt assistance that will still be available. My turn to milk the system.

gregggg
gregggg

BrainDamagedBiden
BrainDamagedBiden

Interesting discussion of coronavirus with Investor Jim Bianco.

Jdog1
Jdog1

I am no hurry to return to restaurants. It is rare when I ever do go to one when I do not leave feeling ripped off.

Realist
Realist

My wife and I order take out from our favourite restaurants roughly once a week in order to support them.

I doubt that we will dine in until vaccines are widely available.

BaronAsh
BaronAsh

Good news from Cheyenne, WY:

Traffic was decent:
"As The Den's parking lot fills with pickups and SUVs, the mostly male crowd inside grows. Chavez says the crowd is a mix of regulars and unfamiliar faces. Oil and gas companies have large operations in the area, and many of the men look as if they've come in from the oilfields for the night.

None of them are wearing masks, and they're clearly looking for a much smaller social distance than Americans have become accustomed to as dancers wrap their legs around them from the stage. Thomas, the union president, said she's worried that customers won't feel safe returning to clubs, although The Den was about as busy as usual for a Friday night, Chavez says."

I suspect that some places will be slow to pick up where they left off, but others will be fast. Depends on how bad things have been and how terrified people are. This strip club obviously has a clientele that isn't much impressed by covid19. Other locales will be very different. Beaches seem fine to many as well - being packed as soon as they re-open. Since they are maybe the safest place to go, probably a good thing too.

Montana33
Montana33

Restaurants are doomed. I used to eat out about 9 times a week and I'm not going to restaurants until I have received a vaccine. Almost no restaurant can make it if their business drops 25% but the sustained drops will be larger than that.

Busdriver1
Busdriver1

Unemployment up to almost 25%. Social distancing all over and restaurant capacity reduced. The added expenses for restaurants of constantly cleaning and disinfecting everything. Three things that will doom a good portion of our restaurants. They will never come back for years to what they once were.


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