A report published by crowd-sourced business review platform operator Yelp has claimed that more than 60 percent of the restaurants in the United States may be closing down permanently as a direct result of the coronavirus pandemic. The report, which included a national survey conducted on thousands of restaurants across the country, has raised concerns over the future prospects of the industry.
Yelp stated in its report that the surprising results indicate the highest number of total business closures ever recorded, surpassing even that in the retail industry. It added that while some businesses have tried to adapt by implementing measures such as curbside pickup, home deliveries, and online ordering, most businesses were simply not equipped to deal with the extended global health and economic crisis.
In its report, Yelp revealed that more than 26,160 restaurants have closed their doors since the start of the pandemic up to July 10. This represented around a 10 percent increase in restaurant closures when compared to the numbers recorded in June. Out of the 26,160 closures, 15,770 or roughly 60 percent were permanent. This included outlets operated by individuals and those operated by restaurant chains who have since gone under due to the pandemic.
Among all the U.S. states, the ones that had experienced the most restaurant closures were New York, Texas, and California. Las Vegas had the most permanent closures among all the other U.S. cities. This made a lot of sense as tourism in the gambling hub effectively ground to a halt once the pandemic hit.
Industry experts had pointed out that the restaurant business is often the first to buckle during extraordinarily difficult economic times. With the pandemic, the ability to generate any type of profit has essentially been taken away. Even before the pandemic, most restaurants were already struggling to keep afloat given the already low profit margins and increased competition from large conglomerate-operated chains.
While most of the data on the report was grim, it did include some positive numbers. In June, the number of permanent closures had decreased by around 14 percent. About 24 percent of previously closed restaurants have at least reopened as of last month. Yelp also claimed that activity on its platforms, including its website and app that publishes public business reviews, has increased. However, the company had pointed out that the surge in activity, which translates to increased visits to restaurants and bars, had coincided with the recent spike in new coronavirus cases, particularly in states such as Florida, Texas, South Carolina, and Georgia.
