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What the Experts Say About Restaurants in a Post-COVID World


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In a wide-ranging conversation that hit on everything from leadership qualities and customer safety to the future of buffets and the value of drive-thru real estate, industry experts Greg Dollarhyde and Malcolm Knapp offered their take on what lies ahead for the restaurant business in 2021 and beyond.

Dollarhyde, who moderator John Hamburger, publisher of the Restaurant Finance Monitor, called “the Wayne Gretzky of restaurants,” is the former executive chairman of the board and CEO of Zoe’s Kitchen, and led the IPO for that brand in 2014 before negotiating a sale to Cava Group in 2018. He serves on the boards of Blaze Pizza and Veggie Grill.

Knapp is best known for his Knapp-Track Sales Index tracking service and also advises foodservice firms and acts as a confidential sounding board for CEOs. He’s performed estimates and forecasts for the National Restaurant Association for the past 40 years.

Read on for some of the highlights, and watch the full webinar recording here.

On major themes in the industry:

Dollarhyde: Convenience is still critical. But convenience now has morphed into ‘I want quality on my terms at my place’ convenient. I want you to deliver a hot pizza to me at a park. Or I want the convenience of getting a great meal in an airport …

I still think there’s a big focus on quality and craveability. I think there’s a lot of people that tend to forget that until it’s, oops, it was supposed to be good and we didn’t execute well.

Knapp: What I think is the most significant is the quality of leadership. In a crisis leadership is even more important than in a non-crisis because people really are up to a panic and they’ll either freeze or do silly things. The people who have really won in this so far, in this new environment, are the ones that have a plan, have a good, strong corporate culture, have injected a little bit of entrepreneurialism in it, and stress execution.

On the future of buffet restaurants:

Dollarhyde: Well, that’s been a declining situation for a long time … Let’s take it to Whole Foods. How much business was Whole Foods doing through those lunch counters, all the selected foods, three rows … 18 percent of their business. That’s a ghost town right now. That’s 18 percent, that amount of square footage is dead real estate. They’re using it to store stuff.

I don’t think that ever comes back.

Knapp: All the fast food guys, when people said cafeterias are gone, they just got reborn as short-line cafeterias and fast casual.

On a $15 minimum wage:

Knapp: I think it’s inevitable … but the real secret in doing things like that is not to do it in one month. It has to be spread out over years so the companies can absorb it and figure out ways to be more efficient. Because if you hire someone at $15, you want to make sure they’re worth $15. So you have to be much more selective in how you do it.

Dollarhyde (pictured above): I think in this country, if we don’t find a way to get more money to people who are struggling, we’re not going to have the country we had yesterday, today or tomorrow. It’s going to be different. We’ve got to find a way to get more money in those peoples’ hands that are out there on the front lines only making $28,000 a year, or $22,000 or $27,000. We really just have to. I think everybody’s gotta just step up and say, OK, how do we want to cover these people …

I think we all just have to realize that those people that are doing those jobs, front line jobs, need to get paid more. And I don’t like it, as a business owner, but I will tell you … $15, $20, absolutely. It’s already happening in San Francisco. To find a good cook in San Francisco you’re at 18, 20 bucks.

On customers feeling comfortable returning to restaurants:

Dollarhyde: I think the whole safe, germaphobia thing has been going on for quite awhile … Nowadays, I tell ya, if you sit down and the table is sticky, you have a sticky table, they’re not coming back. Who knows what that stickiness is. It’s all those little cues that build up.

Knapp (pictured at right): There was always a group, we call them pioneers, who were less afraid or who were in less risky age groups, who went to the restaurants and they observed. And if the restaurant they went to really showed good practices around safety, the mask wearing, the cleaning and servicing of the tables, the whole experience where they felt safe and the distancing was right, etcetera. And it was welcoming and warm and they didn’t have to stand out in a line, they could sit in their car and get texted to come in. All that made it really comfortable. Those people then would go out … and they would tell everybody. This is a Malcom Gladwell tipping point discussion. And by word of mouth they would start to change attitudes, saying it is safe, and this is why.

I think the surveys that show 50 percent of people don’t want to go and sit down, I think that’s probably not true—if they’ve had a word of mouth conveyed that certain brands are safe.

Access more Franchise Times webinar resources here and register for upcoming sessions.

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About This Blog

The latest news, opinions and commentary on what's happening in the franchise arena that could affect your business.

Laura MichaelsLaura Michaels is editor of Franchise Times. She can be reached at 612.767.3210, or send story ideas to lmichaels@franchisetimes.com.
 
Beth EwenBeth Ewen is senior editor of Franchise Times. She can be reached at 612.767.3212, or send story ideas to bewen@franchisetimes.com.
 
Nicholas UptonNicholas Upton is restaurants editor at Franchise Times. He can be reached at 612.767.3226, or send story ideas to nupton@franchisetimes.com.
 
Mary Jo LarsonMary Jo Larson is the publisher of Franchise Times Magazine and the Restaurant Finance Monitor.  You can find her on Twitter at
 twitter.com/mlarson1011.
 

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