Challenging times always inspire transformation. In the business world, 2020 required many sectors to reimagine, with new conceptualizations going beyond blips on the radar to revolutions in the way such sectors will thrive going forward. Two key transformations that we expect to be permanent are in the restaurant and business travel arenas. Let’s dive into the former, shall we?
Reimagining Restaurants
The early 2000s saw the rise of the food truck, initially inspired by hipsters in Southern California and Austin, Texas. In the 2010s, there was growth in food halls, which allowed up-and-coming chefs to start businesses in incubator spaces. Perhaps due to COVID, the 2020s will be the decade of the virtual restaurant.
During the eerie year just past, ‘ghost kitchens’ made their mainstream debut, with fully stocked and staffed commissary-style kitchens and mobile food trailers strategically parked near urban hot spots to pump out delivery-only orders for Uber Eats and other apps. Among the virtues of ghost kitchens are less risk for eatery operators (long-term leases are not required), reduced staffing costs, and cheaper operations.
Ghost kitchens are not new: Five years ago, Grubhub and Seamless were generating about 10 percent of their New York City business out of ghost kitchens, and in 2019, Rachael Ray partnered with a ghost kitchen company for a short-term venture in about a dozen cities called “Rachael Ray to Go.” But with growth in 2020, Euromonitor is now estimating that the ghost kitchen segment could be a $1 trillion global market by 2030.
The rise of ghost kitchens and delivery apps go hand in hand. According to Euromonitor, between 2014 and 2019, global delivery sales more than doubled, and growth spiked in 2020. Uber Eats revenue was up more than double in 2020, while Grubhub’s revenues rose by more than 40%. While this wild growth will likely drop a bit as diners return to local restaurants, 2020 made a majority of people quite comfortable with the concept of ordering “slow food” for home delivery.
The proof is in the survey: Fast Company says curbside pickup and delivery will weather the seasons, with 26 percent of those recently polled saying they would likely order out more often, and nearly a third more saying they’d keep ordering out about the same amount. For more on the phenom, this Restaurant Dive article provides an interesting perspective on the growth and future potential of ghost kitchens and virtual restaurants.
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Restaurants aren’t the only sector of hospitality that had to pivot. We have a few thoughts about the future of business travel, and we talk about them here.
