As the U.S. restaurant industry begins to open back up and recover from the COVID-19 pandemic, many operators continue to struggle financially.
Darden’s sales dropped 26 percent in its fiscal third quarter to USD 1.73 billion (EUR 1.5 billion), beating analysts’ expectations. Its negative sales were also offset by the addition of 10 new restaurants.
The Orlando, Florida-based company operates several casual dining and full-service restaurants chains, including Olive Garden, LongHorn Steakhouse, Eddie V’s, and The Capital Grille.
Meanwhile, Red Lobster, which counts Thai Union Group as a major investor, has closed two restaurants since the beginning of the year. Its Sugar Land, Texas eatery closed its doors permanently, and its Chubbuck, Idaho restaurant shut down earlier this month.
While there is some positive news for the industry as many seafood-centered restaurants open for business this year, the industry’s financial struggles are still prevalent.
More than 110,000 restaurants and bars have closed their doors temporarily or permanently since the start of the pandemic.
In addition, 44 percent of restaurants, bars, and nightlife operators in New York City reported 2020 year-end revenue declines of 76 to 100 percent compared to 2019, according to a new NYC Hospitality Alliance survey.
Thirty-one percent of businesses reported year-end revenue declines of between 51 and 75 percent, and 21 percent of businesses reported year-end revenue declines of 26 to 50 percent, the alliance said.
In January, 50 percent of respondents reported an average weekly revenue dip of 90 to 100 percent this January compared to January 2020.
“The survival of our restaurants and bars is essential to the economic recovery of New York City, so the continued number and nature of these struggling small businesses is alarming” NYC Hospitality Alliance Executive Director Andrew Rigie said in a press release. “The federal financial relief for the restaurant industry championed by Senate Majority Leader Schumer and signed by President Biden was a crucial lifeline for thousands of our restaurants, but without a continuous and concerted effort at all levels of government to revive the industry, the chances of recovery for these businesses and the city will only diminish.”
A recent Harris Poll conducted for USA Today indicates 25 to 30 percent of Americans won’t eat out until herd immunity arrives, meaning restaurants could face struggles for months to come.
However, 33 percent said they would feel comfortable dining indoors at restaurants a few weeks after their first COVID-19 vaccine dose.
Photo courtesy of Kristi Blokhin/Shutterstock
