In news this week, restaurants are trying to gauge the overall impact of Hurricane Irma; while TGI Fridays has found success with its online ordering and is committing to further technology investments.
Irma’s Impact on Restaurants Will Be Substantial
While Hurricane Irma did not pack quite the devastating punch that was forecast, its impact will still be felt far and wide, particularly among restaurateurs, for months to come, according to the Nation’s Restaurant News. And while restaurant stocks actually rose more than 1 percent in the wake of the storm, the road to recovery for many locations will be long and difficult.
The storm had a major impact, closing thousands of locations with power outages and flood waters throughout Florida, Georgia, and South Carolina. Authorities are warning that full restoration of power could take weeks, if not longer. The Associated Press reported that more than 7 million homes and businesses were without power throughout the Southeast, with some 3.5 million customers of Florida Power and Light alone were in the dark. FLP has stated that the utility needs “a wholesale rebuild of our electric grid,” and that the project could become “the longest restoration and most complex in U.S. history.”
And the widespread damage from wind and water will also take time to correct. Even just getting a contractor out to assess a damaged property is difficult in the wake of such a disaster.
“If you have a fire claim, you could probably get a local contractor to come out and help the next day,” said Bill Strout, president of Intrepid Direct Insurance, which specializes in providing insurance coverage to restaurant franchises. “But when you get a catastrophic event to an entire state, it stresses out all vendors. Contractors will probably come from all parts. It’s going to delay getting folks getting back up and running.”
There are 39,000 restaurants across Florida, employing more than 1 million people, according to the National Restaurant Association, and generating nearly $42 billion in annual sales. The longer these locations remain shuttered, the more damaging for the restaurant economy.
Strout said that it could take time for insurers to fully assess the extent of Irma’s damage. “You’re talking 10s of billions and ma6ybe up to $100 billion,” he asserted. Meanwhile, Boston-based risk modeling firm AIR Worldwide estimated the damage at $40 billion.
Recovery is crucial, not only for individuals who have lost their homes, but also for businesses that are trying to recover losses. Strout said, “It’s stressful for the whole community, and restaurants want to get back up and running quickly. The community is looking forward to getting back up and running. And it might be an opportunity for some goodwill within the community to get back up and running.”
Online Ordering Proves To Be A Winning Strategy For TGI Fridays
TGI Fridays has seen take-out sales climb 30 percent since they introduced online ordering a year ago, according to a company spokesperson, and this success has led to further investment in new digital technology. Meanwhile, over 70 percent of those online orders in the past year have come from new customers. And people who order online appear more dedicated to the brand: among customers who don't pay cash, those who order online go to Fridays 51 percent more frequently than those who only dine in. Fridays also says the average order online is 7.2 percent higher than those in-restaurant.
"Online ordering is a proven sales driver for Fridays, so we are going all in on making it easier than ever for our guests to recreate the Fridays experience at home," Caroline Masullo, TGI Fridays vice president of digital and e-commerce, told the Nation's Restaurant News. “We are investing heavily in digital technology because, as an iconic brand, Fridays must evolve along with the lifestyle of our guests.”
TGI Fridays is currently testing delivery through its smartphone apps in select locations. Masullo explained, ‘Everyone today, regardless of age, is looking for convenience and efficiency. And our guests in particular want that convenience and efficiency paired with the fun, social, carefree experience they get every time they walk into a Fridays restaurant.”
To achieve that balance, Masullo stated, “Our team is putting a lot of focus on recreating that in-restaurant experience online, starting with a seamless mobile ordering process so that our customers can easily bring home distinct, delicious food that they can’t get anywhere else.”