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Post-COVID Era: Future of F&B franchise

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Year 2020 has brought an unprecedented and massive change in the way every industry works. With the number of cases rising daily, there is very little to be expected in terms of the lockdown being uplifted. The way people live their lives has changed across the globe and India is no different. What we are seeing perhaps is a crisis like never before with the economy taking a huge hit.

Post-COVID Era: Future of F&B franchise

The Food and Beverage Industry is clearly on a brink and it may collapse in the coming times. The current situation has had a devastating impact not only on the domestic brands but also on some of the most popular international QSR giants that were for the longest time a favourite in the country. Adding to pain is that the F&B industry in India has statically been unorganized and fragmented for years and with the current situation the magnitude of problems have just multiplied. With the hysteria about food ordering, the industry may have to relook at how they function to sustain themselves during and post this pandemic.

Firstly, the pandemic has brought with it a strong need to restructure how businesses function. The contagious nature of this virus will make it impossible for the F&B businesses to thrive without new systems largely focusing on hygiene. Clearly hygiene of food, employees, spaces and packaging will be the prime focus from here on.

Earlier, brands had three main areas to differentiate themselves in the market – superior taste, unique cuisine and quick deliveries. These three aspects were often the USP for most brands across the industry. Now, the industry has witnessed even regular patrons being wary of opting food from restaurants due to the highly contagious nature of the virus. This means that there is a need for a new perspective on branding in terms of hygiene, standardization and a highly trained on ground team in the kitchen.

In 6 months from now things are definitely looking different. We all have to understand that now it is the survival of the fittest and cleanest.

Before the pandemic hit us, we in India (most brands) barely gave any emphasis on standardization with respect to hygiene and health of the employees, things definitely seem to be changing its course now and I believe that the industry needs to get together and create a shared knowledge platform through which we can come up with higher levels of standardization in operations and brand philosophy, based on hygiene.

Another notable trend to keep in mind is the rise of online ordering. Even in the months prior to the crisis, the industry took notice of a shift of consumption from brick-and-mortar restaurants and QSRs to online ordering. There will be a further rise in this trend over the coming months. The truth is that every F&B brand currently needs to reassess their business and embrace this change to actually be able to survive the pandemic. We need to make food aggregator platforms a huge part of our businesses.

Clearly, the biggest contributor to every F&B business’ fixed cost is their rentals and there has been no relief on that either. Brands will have to start looking for affordable alternatives for their larger on ground estates and high operating costs. For franchise based F&B brands, kiosk spaces, dark kitchens or cloud kitchens or micro retail kitchens can prove to be super effective and great alternatives. The franchise brand owners need to support their franchisee partners in this situation by helping them find such alternate solutions to reduce costs.

While the lockdown period is often looked at as a curse due to lower sales, it has also posed itself as an effective time to re-evaluate the businesses. Brands can actually utilize this lockdown time effectively by rewriting their brand bibles and their standard operating procedures. This will help in standardization and trust building of the consumers over the coming months.