Restaurants Defend Dining Rooms as Covid-19 Spreads – The Wall Street Journal

Casual-dining chains including the Cheesecake Factory have installed glass partitions to maximize socially distanced indoor dining space.

Photo: Cindy Yamanaka/SCNG/Zuma Press

Restaurant chains are setting long-term plans to keep dining rooms open whenever and wherever possible as the coronavirus pandemic shows no sign of relenting.

McDonald’s Corp. MCD 0.12% , Starbucks Corp. SBUX 0.03% and other chains are serving customers inside, in line with safety standards they say they have honed during roughly nine months of grappling with the virus. Some executives say they see an immediate boost in sales when dining rooms reopen.

Taking Out

U.S. restaurants have grown their takeout sales, but dine-in sales are still lagging as the recovery has slowed.

Monthly U.S. restaurant sales

SEPT.

TAKEOUT

Full service

$5.2 billion

Quick service

$23.9

DINE IN

Full service

$6.8

Quick service

$3.2

Jan.

Feb.

March

April

May

June

July

Aug.

Sept.

SEPT.

TAKEOUT

Full service

$5.2 billion

Quick service

$23.9

DINE IN

Full service

$6.8

Quick service

$3.2

Jan.

Feb.

March

April

May

June

July

Aug.

Sept.

SEPT.

TAKEOUT

Full service

$5.2 billion

Quick service

$23.9

DINE IN

Full service

$6.8

Quick service

$3.2

Jan.

Feb.

March

April

May

June

July

Aug.

Sept.

SEPT.

TAKEOUT

Full service

$5.2 billion

Quick service

$23.9

DINE IN

Full service

$6.8

Quick service

$3.2

J

F

M

A

M

J

J

A

S

Source: NPD Group

However, with Covid-19 cases rising to new heights, these chains and other restaurant owners are closing some dining rooms again now where officials have instructed them to do so. Illinois suspended indoor dining statewide on Wednesday, while a two-week stay-at-home order imposed by El Paso, Texas, through Nov. 11 has shut dining rooms.

McDonald’s and Starbucks say they aren’t shutting dining rooms across the board this time. Instead they are fine-tuning plans that they say allow them to serve customers inside safely in some restaurants where possible, even as the virus continues to circulate across the U.S.

McDonald’s said it has told U.S. franchisees they may reopen dining rooms when coronavirus cases fall locally for three consecutive weeks.

Starbucks executives said in October that reopening cafes with spaced-out tables and enhanced cleaning protocols has boosted sales. “When we opened the cafe for limited seating, the response is immediate,” Starbucks Chief Executive Kevin Johnson said.

Some chains, including Wingstop Inc., have decided to keep dining rooms closed, reflecting the quandary facing restaurants—and other companies—operating in uncertain and fluctuating circumstances. From manufacturers to malls, businesses are overhauling their operations to keep operating during a global pandemic. As Covid-19 cases climb again, companies are revisiting their recently developed policies and procedures, and changing them as needed.

Health experts say that while restaurants can take steps to reduce the risk of spreading coronavirus inside, takeaway service and outdoor dining remain safer.

“I recommend against indoor dining,” said Thomas Russo, chief of the infectious diseases division at the University at Buffalo’s Jacobs School of Medicine and Biomedical Sciences.

A McDonald’s restaurant in Brooklyn, N.Y., where only takeaway service is available.

Photo: Wong Maye-E/Associated Press

The lack of widespread contact tracing in the U.S. has made it difficult to determine whether restaurants are facilitating the spread of the coronavirus, but federal and state studies indicate some connection. A U.S. Centers for Disease Control and Prevention survey in September found that people who tested positive for Covid-19 were about twice as likely to have dined at a restaurant within a two-week period as people who tested negative for the virus.

The virus thrives in enclosed spaces, and eating in a restaurant exposes diners to close contact with other people for extended periods while they are talking and not wearing masks, scientists say. Ventilation, air-purification systems and well-spaced tables can help but won’t eliminate the dangers of indoor dining as cases rise, said Dr. Russo of the University of Buffalo.

Casual-dining chains including Cheesecake Factory Inc., CAKE -2.69% Texas Roadhouse Inc. and BJ’s Restaurants Inc. BJRI 1.27% have installed glass partitions to maximize socially distanced dining space. The dividers are more permanent than plexiglass separators, and cost millions of dollars across dozens of restaurants. California-based BJ’s Restaurants told investors last month that the partitions allow it to add a dozen more tables into service in a location while abiding by social-distancing regulations.

Bloomin’ Brands Inc. BLMN -0.21% Chief Executive David Deno said the Outback Steakhouse owner is investing in equipment and training to protect customers. “I don’t mean to make light of things, but they love coming back into our businesses and enjoy eating out,” Mr. Deno said in an interview.

About 90% of the Duck Inn’s current revenue comes from customers enjoying socially distant table service in their outdoor seating area. Especially in places like Chicago where temperatures drop below freezing, it’s one of many restaurants grappling with how to prepare for and survive winter. Photo: Nicolas Silva for The Wall Street Journal

Operators say keeping dining rooms open becomes more important to their businesses as temperatures fall across much of the U.S., making outdoor spaces that helped sales in the summer less tenable.

The number of open restaurants and bars is declining in states with falling temperatures and rising cases, including Illinois, Michigan and Ohio, according to labor scheduling-software company Homebase. Dining reservations have plateaued or fallen in many states in the past month, data from online-booking platform OpenTable shows.

Many restaurants are struggling to keep afloat amid regulations requiring them to limit the number of customers eating inside or close indoor dining entirely. The National Restaurant Association projects that at least 100,000 restaurants will close this year, about double the typical annual rate. The trade association wants officials to take into account the efficacy of spaced-out tables, air-purification systems and other safety measures before banning indoor dining.

McDonald’s kept most of its dining rooms closed this year as Burger King and others continue to add back indoor service. Around 2,000 of McDonald’s 14,000 U.S. restaurants are serving customers in dining rooms, the company said.

McDonald’s said it doesn’t expect a flood of reopenings given the rise in Covid-19 cases. “We aren’t rushing to reopen dining rooms just to make a couple extra bucks,” Bill Garrett, McDonald’s U.S. senior vice president of operations, said in an interview.

But while McDonald’s U.S. sales have bounced back with largely just drive-through, pickup and delivery sales, dining rooms are still an important source of revenue. McDonald’s executives put a big focus on improving the chain’s indoor dining before the pandemic through amenities such as digital kiosks and table service. Many U.S. franchisees spent hundreds of thousands of dollars on the upgrades, and the company also funded part of the cost.

McDonald’s executives told U.S. franchisees in late September that they could resume reopening dining rooms if cases were declining in their jurisdiction, based on state and county data, and local regulations allowed for in-person dining. The company said it was taking into account feedback from consumers and employees on the prospect of dine-in service. Play areas will remain closed.

SHARE YOUR THOUGHTS

Do you feel comfortable dining out as winter approaches? Why or why not? Join the conversation below.

It is up to franchisees whether they decide to reopen, and many McDonald’s franchisees say they are generating strong sales without dining-room service.

Tracy Johnstone, owner of seven McDonald’s restaurants in Florida that have remained closed to dine-in customers for much of the pandemic, said she has grown accustomed to just serving customers to-go. “It is just part of doing business responsibly,” she said.

Write to Heather Haddon at heather.haddon@wsj.com

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Appeared in the November 9, 2020, print edition as ‘Chains Refine Plans to Keep Indoor Diners.’