After making numerous operational changes during the coronavirus pandemic, restaurant owners are now feeling optimistic about the future, according to Nationwide.
The coronavirus pandemic took its toll on the restaurant industry with nationwide shutdowns, financial losses and significant decreases in foot traffic due to social distancing restrictions. Yet, today, after making a raft of operational changes, restaurant owners are feeling optimistic about the future, according to a new Agency Forward survey from Nationwide.
Some of the ways restaurants have been making changes to mitigate the effects of the coronavirus pandemic include the utilization of mobile ordering and payment devices, an increased emphasis on food delivery and take-out services, and the implementation of paperless menus, such as those accessible via QR codes. As many as 30% of restaurants have also reported reduced operating hours, according to the survey.
These new ways of operating signal a marked shift in what was once considered a primarily face-to-face industry. But with these changes have come new challenges, some of which require the services of trusted insurance providers.
Unsurprisingly, digital risks have emerged within the restaurant industry, including the increase in online negative reviews as social media usage skyrockets. As many as 17% of restaurants are wary of relying heavily on technology for their business operations, particularly in light of the cyber vulnerability both owners and patrons face.
“Cyberattacks pose a significant business risk, especially when our Agency Forward research shows 76% of consumers would stop doing business with the company responsible for a data breach that impacted them," said Peter McMurtrie, president of commercial lines at Nationwide. “As restaurants increasingly rely on technology, cyber liability insurance becomes crucial for safeguarding sensitive customer data and avoiding costly breaches or reputation hits."
Nevertheless, customer satisfaction among restaurant patrons is strong, with 3 in 4 diners rating their dining experiences as good or excellent, according to the survey. In regard to new technology, 72% of patrons are satisfied with the use of mobile ordering and payment devices. Meanwhile, an overwhelming majority have praised the addition or expansion of loyalty programs, as well as food delivery and take-out services.
Similarly, 3 in 4 restaurant owners report an increase in revenue over the past six months, and over 93% anticipate revenue increases in the next six months. As customers grow accustomed to the changes in the industry, the role of insurers in protecting both owners and patrons cannot be minimized.
Yet, even with their optimistic outlook, inflation and supply chain issues pose significant threats, along with fires and essential equipment breakdown, according to the report. These risks, along with the increased vulnerability to cyberattacks, have prompted 84% of restaurant owners to review their policies in the last six months. Over three-quarters are currently working with an insurance agent to manage their needs and 42% report planning to add another type of coverage to their policy or increase coverage.
“As key decision makers reevaluate insurance coverage needs, it's more important than ever to work with an agent and carrier with specialized expertise and resources to ensure your business and livelihood is adequately protected from longstanding and emerging risks," McMurtrie said.
Ann Seaberg is an IA contributor.