Restaurant transactions plateau as coronavirus cases surge

As coronavirus cases surge in the United States and many states reshutter indoor dining, restaurant transactions have plateaued. 

The NPD Group tracks transactions at 75 restaurant chains that represent more than half of total U.S. commercial restaurant traffic. According to its data, the U.S. restaurant industry began reversing transaction declines in April and was inching closer to a return to year-ago transaction levels by mid-June. 

Then Covid-19 cases began surging again. Some states began reclosing bars and dining rooms — or at least restricting indoor dining capacity, as in Texas — after some outbreaks were traced back to such establishments.

Research suggests that the coronavirus can be transmitted through air particles in closed indoor spaces, a position that the World Health Organization said it cannot rule out. Health experts say that dining or drinking indoors is riskier than outdoors, where the virus can dissipate more quickly. 

Consumers are avoiding restaurants, bars and coffee shops more now, according to a Coresight Research survey of more than 400 respondents. On July 22, 61.9{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} of respondents said that they were avoiding those establishments, up from 61.2{3c4481f38fc19dde56b7b1f4329b509c88239ba5565146922180ec5012de023f} a week prior. 

The shift in behavior appears to be hurting full-service restaurants more, which have already been battered harder by the pandemic. Fast-food restaurants like McDonald’s and Chick-fil-A can rely on their drive-thru lanes to drive sales, and their cheap deals also appeal to cash-strapped consumers during the crisis. 

Full-service restaurants, on the other hand, saw their transaction declines reverse more quickly in May and June as states reopened dining rooms. And many of those chains were experiencing lagging growth even before the pandemic, spelling trouble for their ability to stay afloat.