Starbucks to street-vendors: Covid’s takeaway vs dine-in battle has it all
Do you cry rivers over the last time you went on a brunch with colleagues, or a Friday night with friends, or a fancy dinner date? Well, keep unlimited tissues coming. ( Sigh x100 )
With dystopian pictures of dine-ins with plastic shields coming from Wuhan, it is safe to assume that the idea of fun over food is gone for a long………….. foreseeable time. Post COVID-19, 77 per cent people want to dine out, and 23 per cent prefer continuing with delivery/takeaway in India, reveals a survey by restaurant tech solutions platform, Dineout.
In such a dire situation, fine dining experiences, restaurants, cafes, are left with very minimal revenue. However, businesses with a heavy drive-thru footprint have fared significantly better than those without — both because of the stay-at-home necessities and because of the perceived safety of the channel.
In desperation for the same, Starbucks- the originally ‘third place’ for its customer, with experience being its niche, has taken alternative measures, pushing takeout through its establishments.
Yesterday, the coffee giant released its latest SEC filing. It started with disappointment that Starbucks will close up to 400 company-operated stores over the next 18 months, but ended with hope- the company is laying the foundation for a “transformational phase” that will introduce a new store format known as “Starbucks Pickup”.
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Starbucks Pickup was crafted ahead of this pandemic originally due to a shift in consumer behavior, indicating a massive inclination towards takeaways. This major shift from ‘third place’ ideology was for customers who prefer to order ahead and pay through the Starbucks mobile app for pick-up. It is also available to the customers who want their Starbucks delivered to them by placing an order through Uber Eats.
Seemingly, the process is simple enough. Customers order a drink on their phones, go to the Pickup store, find their names within a digital queue on the wall. A screen alert/notification is sent to them when their order is available for pickup.
However, their plans accelerated due to the ongoing crisis and changes in consumer behaviors. With a lesser crowd and zero contact, Starbucks says it will increase the number of locations offering curbside pickup. Access to drive-thrus will be expanded too.
Take-away vs Dine-in: A battle restaurants need to pick to survive this pandemic in India
Digital delivery and pre-order takeaway will gain prime focus of restaurants in post-Covid era to stay financially viable amid strict social distancing norms- Massive Restaurants, Jubilant Foodworks, Chaayos at a webinar hosted by Retailers Association of India (RAI) on the future of food business.
Let us look at the inventory and operational expenses shall a restaurant offers dine-in vs take-away (Combine this with customer sentiment, and take-away seems the most likely option):
With most of India unlocking now, and people going out for work, food delivery doesn’t always seem the better option. With people moving out for work, and looking for food-on-the-go to fit in between their crazy schedule, the takeaway model comes to rescue. Tell me, don’t you miss your Raju bhaiya ki chai? or your go-to chicken wrap? Ofcourse you do, they have been our savior and cravings at innumerable time. But would you go back to them now? No, because guess what- hygiene is the spotlight for this season! Now, let’s eliminate our options in a very very simple customer POV:
Take-away wins for a majority of working-class in the metros of India. Following the same suit, more and more restaurants are offering takeaway options now. Meet Koteshwar Anna from Dasapalla- He says, “Our takeaways have increased since we reopened our kitchen. Pre-COVID we would have a little over 100 orders but this has shot up to 200 now.” Recently, even top five-star chains such as The Oberoi-Bengaluru, Indian Hotel Company’s Taj chain, and The Park Hotels have also started delivering food as takeaways from their in-house restaurants, after a long and hard resilience.
The Future:
While this seems a sentiment as of now to which more and more food-chains and restaurants are responding to, this may actually be the future amidst the COVID crisis. With the kinds of Starbucks setting an example, this trend might catch-up faster across all levels of the food & hospitality business. Even if the revenue figures cannot be compensated off, atleast they will have some digits to show. Afterall, coffee cannot be home-delivered, and neither can it be ‘experienced’ as before.
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References:
- https://www.forbes.com/sites/aliciakelso/2020/06/10/the-coronavirus-crisis-has-caused-starbucks-to-shift-its-real-estate-strategy/#35de165d197c
- https://economictimes.indiatimes.com/industry/services/hotels-/-restaurants/restaurants-to-steer-towards-delivery-takeaway-model-impacted-by-long-road-to-recovery-post-lockdown/articleshow/75896196.cms?from=mdr
- https://techcrunch.com/2020/06/10/starbucks-to-close-400-stores-speed-expansion-of-pickup-locations-curbside-and-more/
