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Dine-In Dealt Another Deathblow as QSRs Revert to Digital Ordering vs Policing Vax Mandates

Once again, restaurants are closing their dining rooms for virus-related reasons, though this time it is not out of fear of transmission — it is to avoid the challenges of enforcing vaccine mandates. Some quick service restaurant (QSR) locations in cities with proof of vaccine requirements are closing their seating areas, Reuters reported Friday (Oct. 1).

The news outlet noted that White Castle had closed its dining rooms in over 20 New York City locations, and that multiple Taco Bell and McDonald’s restaurants in the city had done the same. Inspectors in the city have issued thousands of warnings and a handful of $1,000 violations.

The Context

Over the past couple years, QSRs have been periodically forced to close their dining rooms for various reasons. With the initial round of COVID-19 lockdowns, many restaurant chains built out their off-premises options, rolling out delivery and curbside pickup options, among others. After the vaccine rollout got under way, and consumers returned to their lives away from home, the severity of the restaurant labor shortage became acutely felt, causing some QSRs to close dining rooms for lack of staffing.

Now, dining room closures are not the disasters for these restaurants that they were in March 2020, since brands have become accustomed to the demands of running an off-premises-only business. Still, these closures mark a significant lost sales opportunity, though they save the labor of checking for proof of vaccination and of maintaining the orderliness and cleanliness of the area.

By the Numbers

Research from PYMNTS’ Restaurant Readiness Index, created in partnership with Paytronix, finds that indoor dining makes up a small but far from negligible portion of QSRs’ revenue — 12% of sales come from dining room customers. While this may seem like a small percentage, it is the same share as sales that come through restaurants’ online delivery ordering platforms.

See more: QSRs’ Lagging Loyalty-Reward Investment Hurts Innovation and Sales

What the Experts are Saying

When dining rooms close, the restaurants with the most comprehensive digital options are the ones that succeed.

“Everyone in the industry saw the big swing to online ordering,” Jane McPherson, Capriotti’s senior vice president of marketing, told PYMNTS in an interview for the September/October edition of our Order to Eat report, reflecting on the last couple years. “We were really fortunate in that we had so much of our infrastructure really well built out. We had a really robust online ordering platform, and we were well-optimized. We quickly implemented a robust curbside pickup solution, offering customers the opportunity to [scan] a QR code and place an order from outside of the store.”

Still, vaccine mandates are something of a lose-lose for restaurants, whether cities have them or not.

“There’s a lot of anxiety,” Andrew Robbins, co-founder and CEO at Paytronix, said in an interview with Karen Webster, discussing the current climate among restaurant operators. “There’s anxiety from putting your frontline staff at risk, and you can put them at risk because of the Delta variant. You can also put them at risk trying to enforce this stuff.”

Related: Vaccine Mandates Are A Lose-Lose For Frontline Restaurant Workers, Says Paytronix CEO

Capriotti’s on Leveraging Digital Tools, Data Analytics to Drive Customer Loyalty

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