U.S. foodservice revenues are forecast to decline in 2020 more than 25 percent compared to last year as the pandemic shutters restaurants nationwide, and independent full-service restaurants “will be especially harmed in the short term by the widespread closures of dining rooms.”
That’s according to a new report from market research firm Packaged Facts, which “estimates that thousands of full-service restaurants and bars will close permanently in 2020 due to not being able to compete effectively in the temporary landscape that bans dine-in service—their chief business.
“Up to 20 percent of such eating and drinking establishments (including independent and franchised/large chains) may close in 2020 as cash flow dries up due to closed dining rooms and inability to make up enough lost dine-in sales on carryout and delivery,” said Packaged Facts.
The new report, titled “Food Carryout & Delivery,” forecast that the U.S. foodservice sector’s revenues will return to growth and recover by 2024.
The report warned, however, that the five-year period of recovering growth “is expected to remain slower than during the 2014-2019 period due to permanent restaurant closures and continued negative impacts on consumer spending.”
Full-service restaurants are expected to continue seeing decreased share of restaurant sales as revenues from fast food and fast casual restaurants grow faster through 2024.
Although full-service restaurants have slowly been losing share of restaurant spending to less expensive and more convenient fast food and fast casual restaurants, they still made up the largest share of revenues from eating and drinking places in 2019.