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MARCH 29, 2022

Nemco On The Off-Premise Foodservice Boom

In 2018, operators were striving to downsize their kitchens to allow more space where revenue is generated. At that time, it was the dining area. With the decrease of the dine-in demand and increase in off-premise dining, the revenue-generating space has changed.


The revenue-generating space switched to drive-thru lanes and food pickup areas without a lot of notice. Many operators are running delivery-only ghost kitchens and unveiling new building design prototypes that sacrifice kitchen AND seating space for multiple drive-thru lanes, curbside pickup, walk-up kiosk ordering, and throwback parking-lot dining. The focus shifted to services offering convenience and speed versus seating.


So what’s next? Now that operators dedicated kitchen space to virtual brands for survival, they have to consider the dine-in demand that is storming back. As a result, operators are having to take yet another look and adjust plans to either keep the additional off-premises revenue streams going or return their focus to the customer at the table.


The challenges that come with a shrinking kitchen remain, even if they’ve evolved enough to demand a review.


Restaurant Service Is Still the Big Challenge


Today, digital technology is no longer a ‘some-day, maybe’ alternative; it has moved to the priority list. And it’s still evolving at a rapid pace. But is it making it easier to deliver a great customer experience?


Nemco referenced this recent insight from Restaurant Dive for some answers. 


•   A report from Oracle finds that increased off-premises business at restaurants impacts customer expectations for service speed. For example, over 20% of restaurant customers are annoyed after waiting two minutes to order at the drive-thru window, which jumps to 70% of customers if the wait is five minutes.


• Further, 47% of respondents said they feel like delivery and takeout orders have resulted in longer waits when ordering in person. In comparison, 38% of consumers believe dine-in business is less of a priority than digital orders.


Restaurant owners are going all-in on digital and off-premise applications to meet their customers’ speed and convenience demands. 


In many cases, restaurant owners are tasked with creating a clear operational distinction between dine-in and delivery service. Many operators are finding that creating a separate venue for delivery is critical. If the labor crunch makes this problematic, it might be time to make that hard decision to drop either the on- or off-premises business.


Keeping the Menu Fresh Is More Important Than Ever


Strategic menu planning, and in many cases, menu shrinking, has been an operator response in the face of rising food and inventory costs. Keeping the menu simple also helps with the labor turnover and the explosion of takeout and delivery. Today, it’s even more challenging. Because that same consumer who doesn’t want to wait five minutes at the drive-thru also has a shorter attention span for taste preferences.


Thriving in this new era takes more menu evolution, which still demands equipment that can fit the space, versatility, and durability requirements inherent in a leaner kitchen. But, for those making a more significant commitment to off-premises dining, it demands a smarter strategy to optimize delivery food quality.


And, for all segments, the new era also has upped the stakes on limited-time offers. In a smaller kitchen operation, LTO development is more challenging because restaurants have to wow their customers without operational extravagance.


Finding partners with experience in LTO development becomes imperative, and operators must find their sweet spot for innovation frequency and investment. It is possible to get over-extended on projects, and even for fickle customers, it’s also possible to overwhelm your market with too many test items.


It’s an exciting time and a challenging time for foodservice professionals. Restaurants are creatively coming up with new concepts and significant operational changes to keep up with the demands while navigating the challenges. Nemco is known for commercial kitchen solutions and places a high priority on researching foodservice professionals’ needs, challenges, and opportunities and offers equipment and supply solutions to help operators achieve their goals. In addition, they provide valuable insights and resources through their blog. Click here to browse the topics and check them out. Visit Nemco Food Equipment for solutions.

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