It’s been over a year since the COVID-19 pandemic upended the relationship diners once had with their favorite restaurants and bars. The pandemic made food delivery central to people’s lives and catapulted the business of third-party delivery platforms, which many restaurants relied upon for marketing as well as drivers. Restaurants say delivery has been both a blessing during the pandemic. But as vaccinations increase and pandemic restrictions are slowly being relaxed, what will happen to delivery demand once eateries reopen?

Lifeline: When Covid shuttered business delivery stepped-in
Before COVID-19, while delivery was growing, it was still only 3% of all restaurant orders in 2018. The pandemic however changed all that. From the first days of COVID delivery and curbside pickup became a lifeline to many. Due to restrictions, businesses had to temporarily shut down. Overnight inventory was lost, staff furloughed and source of revenue was now non-existent for many. In order to survive, restaurants had to reinvent themselves and quickly. For many this meant transforming from a full-service restaurant to takeout. As such, restaurants flocked to third-party delivery services as they was the easiest way to get their food to customers.

In a short space of time, delivery and pickup rapidly became the main source of business; to-go sales increasing by 96% alone in May of last year. At the end of 2020, restaurant delivery sales more than doubled to $40.8 billion from $19.6 billion a year earlier, according to market research firm NPD Group. The share of orders through third-party aggregator apps more than tripled, to $20.6 billion from $5.9 billion, during that time.

Now after a year of heavy reliance on delivery and take-out, restrictions are slowly being relaxed paving the way to a return to normality. This week, starting May 19, New York, New Jersey and Connecticut will drop their capacity limits and nearly all other restrictions on dining. For many, owners and diners alike, the removal of restrictions and reopening is one of the most keenly awaited dates in the diary. It is anticipated that there’ll be a resurgence of diners ready to splurge on anything that doesn’t involve sitting at home. But what will this mean for delivery? Will delivery-heavy stores take a hit as diners finally go out again?

Delivery growth expected to stabilize
The good news story, according to a Restaurant Business Online article, citing a report by the National Restaurant Association, U.S. restaurants are on track for a steady recovery after declining 19.2% in 2020. This may be due to the fact that recent surveys show that more than two-thirds of adults are eager to dine at restaurants more often once they are able to do so, “Everybody will want to get out. Not everybody can get on a plane and go away, but everybody has the ability to go out and reconnect at a restaurant,” Massachusetts Restaurant Association president and CEO Bob Luz.

While delivery heavy restaurants might experience an initial decline, the long-term habits shaped by the pandemic suggest delivery will remain paramount. Customers have adapted to this new way of dining and have shown that they are willing to pay a premium for the convenience of delivery – which often includes higher menu prices as well as a delivery fee and driver tips, said Darren Tristano, CEO of Food Service Results, a Chicago-based market research and consulting firm.

Future of delivery: Restaurants look for alternatives to third parties
During Covid, its clear delivery was important for both business owners and their customers. In a recent study 68% said that had they not introduced collection or delivery, their business would not have survive. On the flip side however, 92.5% also said they didn’t feel the commission (of up to 33%) charged by third-party aggregators during the pandemic was fair, with 81% stating that commission rates are not a sustainable long-term business model.

Those who partnered with a third party have begun weighing up their options, looking at alternative delivery models they can sustain long term. Some restaurants are hiring their own drivers. Others are partnering exclusively with a single third-party platform so they can exert more control. Many are trying to drive customers to their own websites, rather than the outside companies, for online orders to avoid fees that can take sizeable bite out of each transaction.

Whatever the outcome, there is no question, in the post-Coronavirus economy, takeout and delivery will continue.