Many Americans traded from restaurants to retailers for their food and beverage needs during the COVID-19 crisis; as the consequent recession continues, retailers remain a fierce competitor and barrier to restaurants’ recovery in 2021. Limited-service restaurants will recover much faster than their full-service counterparts due to their affordability and off-premise convenience. Restaurants of all types must find new and exciting ways to engage consumers at home and improve their value perceptions in 2021 in order to survive the rocky road to recovery.

• The impact of COVID-19 on consumer behavior and the foodservice industry

• The recessionary impact on the foodservice industry

• Consumers’ attitudes toward dining out and foodservice in 2021

• How restaurants can survive another troubled year ahead with off-premise innovation

This Report provides a forward-looking view at what to expect for the US foodservice industry in 2021. In light of the severe impact COVID-19 has had on foodservice, particularly on-premise dining, this Report combines industry expertise with current consumer attitudes, behaviors and perceptions toward foodservice as well as their anticipated behaviors in 2021. This Report builds off of Mintel’s Dining Out in 2020 – US, December 2019.

For the purposes of this Report, Mintel has used the following restaurant definitions:

• Quick service restaurants – Used interchangeably with “fast food,” QSRs specialize in inexpensive, convenient meals with no waiter service, no alcoholic beverages and a low price point. Examples include: McDonald’s, KFC, Taco Bell, Wendy’s and Pizza Hut.

• Fast casual restaurants – These establishments are characterized by a higher price point than QSRs, though not as high as full-service restaurants. Fast casuals do not offer waiter service and may or may not serve alcohol. Examples include: Chipotle Mexican Grill, Panera Bread, Shake Shack and Blaze Pizza.

• Limited-service restaurants – LSRs provide food services and customers usually select and order items and pay before dining. Food/drink may be consumed on the premises, offered as carryout or delivered to the customer’s location. These may also sell alcoholic beverages. LSRs include both QSRs and fast casual restaurants. The other category within LSRs (as seen in the Market Size and Forecast) includes snacks and non-alcoholic beverage bars, cafeterias, grills and grill buffets.

• Full-service restaurants – FSRs have waiter/waitress service and customers order and are served while seated. These may also sell alcoholic beverages and offer carryout services. They include the restaurant segments: family midscale, casual dining and fine dining.

The first COVID-19 case was confirmed in the US in January 2020. On March 11, the World Health Organization declared COVID-19 a global health pandemic; on March 13, President Trump declared a national emergency in the US.

Across the US, state-level stay-at-home orders rolled out throughout the months of March and April, remaining in place through May and in some cases June. During this time, referred to as lockdown, non-essential businesses and school districts across the nation closed or shifted to remote operations, which meant restaurants suspended dine-in service and only sold foods and beverages for takeout or delivery.

During re-emergence, all 50 states have relaxed stay-at-home orders and allowed businesses to operate with varying levels of social distancing measures in place. The continued spread of COVID-19 infections has driven some states to slow down or reverse course on reopening plans, including the resuspension of dine-in service in select cities and states in the Fall of 2020. Mintel anticipates the US will remain in a state of flux through 2021, until a vaccine is widely available.

This forecast and subsequent Report assumes that:

• Consumer expenditure on hotels and restaurants is estimated to decline 10.5% in 2020 and recover to prepandemic levels in 2023.

• Personal disposable income will increase an estimated 3.1% in 2020 but is forecast to remain in the 2-3% growth range over the next five years, which is much lower than the prior five years.

• The US unemployment rate is estimated at 8.5% in 2020 – comparable to rates during the Great Recession – and it’s not set to recover to 2019 levels in the next five years.