After COVID-19, What Does the Future Hold for Retail and Hospitality?

The COVID-19 crisis hit virtually every industry hard, but few sectors felt the impact quite like retail and hospitality. Now, states across the U.S. are beginning to reopen, and franchisors are eager to learn what comes next for those sectors.

On Friday, 1851 Franchise published a white paper authored by Philip Schram, Chairman of the Board at Buffalo Wings & Rings, called “The Future of Retail and Hospitality.” The document provides context for and analysis of the current state of the industries and predictions for the post-COVID landscape. 

Following the release of “The Future of Retail and Hospitality,” Schram joined David Birdsall, Managing Partner and Co-Founder of real estate investment firm Last Mile Investments, and Nick Powills, Publisher of 1851 Franchise, to discuss the white paper.

The Changes Ahead

Birdsall has seen his share of retail catastrophes and resurgences. After this crisis, the businesses that shouldn’t be around, won’t be around. Retail went through a resurgence in the ‘90s with big box stores, but now it’s shrinking. Online is a factor in this, but doing business online is also very expensive. Brick-and-mortar will continue to be important for retailers. 

For restaurants, we will see a rise in ghost kitchens, which are less expensive to build out and can allow for delivery in multiple markets. We will also see an acceleration in the ability to serve customers in multiple ways. 

The Great Reset

Some brands will think of new ways to serve their customers and discover who their customers are. The landlord-tenant relationship, too, will get a reset, especially for smaller businesses. During this challenging time, some of the larger retailers have been the bad actors, whereas small retailers have been great to work with. 

Avoiding Getting “Blockbustered”

Companies need to nail their operations today while also thinking ahead. Being able to respond to the future needs to be in the DNA of the leadership team and board. Companies need to be flexible and vigilant and follow and anticipate situations. 

Businesses need to be stable from a financial standpoint so when a black swan event happens, they are prepared to be mentally strong to figure out the recovery strategy. 

Adjusting to Meet Consumers

Drive-thrus will not work for every restaurant brand. They won’t work for fine dining establishments and higher-end restaurants. The key word is flexibility. There are multiple ways to serve customers. If brands are flexible and execute well in their different channels, they will see which methods connect with customers best. 

How food is packaged and delivered to customer homes is very important. Brands need to contribute to that experience, listen to their guests and learn about how they consume the brand. 

In-Person Experiences Are Still Important

Services such as GrubHub and UberEats have been convenient during this time and have served an important purpose, but at the end of the day, people still want to be with other people. We enjoy interactions with people, and we like having someone serve us food and having that food come to us hot. People are social animals and made to gather together.