After an “unprecedented “ 2020, during which restaurants across the country were closed for several months due to continent-wide lockdowns, the North American restaurant industry is set to make an impressive recovery by the end of 2021! And has seen promising growth after low 2020 numbers.
In August, the American National Restaurant Association released its mid-year supplement to the 2021 State of the Industry Report, which projected a 19.7% increase in sales from 2020. The October release of Restaurant Canada's 2021 Food Service Facts showed a 12.3% expected increase in annual commercial foodservice sales from 2020.
In this article, we will delve into the North American restaurant industry’s growth over the past year, in the key sectors of overall growth, quick service growth, and full-service growth!
We will also cover the issues it has faced, and the adaptations it has had to make to survive the coronavirus pandemic.
Let’s dig in.
The North American industry has seen a significant improvement in sales from 2020, although they are yet to reach pre-pandemic levels.
In its 2021 State of the Industry Report, the American National Restaurant Association projected that food and beverages sales would total $789 billion by the end of 2021, a 19.7% increase from 2020’s figures.
According to Restaurants Canada, annual food and beverages sales in Canada will improve to $63.9 billion, higher than the earlier prediction of $61.1 billion, and over 12% higher than 2020’s sales.
The increase in sales can be attributed to the reignition of all the foodservice sectors, including full service, quick service, bars, and catering, among others.
Quick service restaurants typically offer fast food – food items that require minimal preparation time and are delivered through quick services.
Like other parts of the Canadian restaurant industry, the quick service sector saw a big drop in sales in 2020. Compared to sales of 28.42 billion in 2019, it only grossed 25.82 billion in 2020.
However, it has made a remarkable recovery in 2021. Data from Statista projects that quick service sales will reach an impressive 27.57 billion by the end of 2021, a nearly 7% increase on 2020. While this figure is not higher than pre-pandemic sales, it still presents a more impressive recovery than other parts of the restaurant industry.
The U.S. quick service restaurant industry saw a similar drop in sales during the pandemic, with sales dropping from $295.91 billion in 2019 to $256.03 billion in 2020.
In 2021, the quick service restaurant industry has made a full recovery, with sales projected to surpass pre-pandemic sales at $296.55 billion, according to data from Statista.
Industry experts believe that because most quick service restaurants had already developed off-premise services like drive-thru and takeout prior to the pandemic, they were less heavily affected than full-service restaurants when lockdown restrictions were instituted and, as such, have made a quicker and more robust recovery.
Full-service restaurants offer guests on-premise meals, a broad range of menu items, with servers bringing ordered meals and drinks to their tables.
The full-service restaurant industry suffered significant losses globally due to mandatory lockdowns during the pandemic. Hundreds of thousands were unable to make the recovery in the aftermath and had to close permanently.
According to Statista, the Canadian full-service restaurant industry grossed sales of $22.3 billion in 2020, a massive 37.7% drop from 2019 sales. There was an attempt to rally back in 2021, but the projected end of year sales of $29.15 billion will still fall short of pre-pandemic sales.
The National Restaurant Association reported full-service restaurant sales of $199.5 billion in 2020, a staggering 30% drop from $285 billion grossed in 2019.
But 2021 has seen consumer spending rise sharply, this primarily driven by rising vaccination numbers, additional stimulus payments, and healthy household balance sheets. The 2021 State of the Industry Report projects sales of $255 billion by the end of the year, a 27.8% increase on the previous year.
Data from Statista predicts a surge in the number of full-service restaurant businesses in the U.S. to reach over 162,000, an increase from pre-pandemic numbers. The full-service restaurant industry is expected to continue to grow in the years to come as consumer spending increases.
This year was full of ups and downs in the industry - but the industry has proven again and again that it’s resilience is second to none, and that of course, it is and always will be here to stay. Some of the challenges that that industry faced also acted as catalysts for exciting and innovative change in the hospitality industry. And have shaped the future of hospitality as we know it.
All and all, it is an industry that we are excited to follow and see thrive.
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