The restaurant business isn't going to survive COVID-19, not in the form that it is in now, and if even one of the biggest fast-food juggernauts in the business, Yum Brands,
is closing 7,000 locations worldwide already, it's going to be a bloodbath over the next couple of months.
Louisville-based Yum! Brands is closing around 7,000 stores around the world because of the coronavirus, according to financial records.
Among the closures are 1,000 Pizza Hut Express locations the the U.S. and at least 900 KFCs in the U.K., according to a March filing with the United States Securities and Exchange Commission.
Yum!, which has at least 50,000 restaurants in more than 150 countries, owns KFC, Pizza Hut, Taco Bell and The Habit Burger Grill.
"The COVID-19 pandemic continues to impact the operations of our restaurants in numerous markets across the world," according to the filing. "As we have taken steps in response to the pandemic, our primary focus continues to be the safety of everyone who engages with our Brands, including our employees, franchisees and their team members, and customers."
Sales are expected to drop through the quarter ending March 31, the company wrote in the filing, but it expects the quarter ending Jun 30 to be "more significantly" impacted.
"Because this situation is ongoing and because the duration and severity are unclear it is difficult to forecast any impacts on the company’s future results," the filing says.
One thing that's going to be really clear in a few months is that sit-down restaurants, movie theaters, bars and nightclubs, and brick-and-mortar stores are not going to survive, not as mass-market concepts. We were already facing a retail apocalypse in this country.
Places are going to close their doors this week and never reopen.
The survivors are going to be leaner, meaner, and delivery-friendly, because that's the future. Oh sure, some will exist, but they will be boutiques, people are still going to need to eat. But there won't be four Starbucks within a mile radius. There may not be four in a 100-mile radius.
Just an utter obliteration of commercial real estate. Show a picture of an Outback steakhouse or a TGI Friday's to a kid in ten years and they will look at you like you just handed them a mythical relic of last century, like a flip phone or a compact disc or a moderate Republican. Automation will become king. And everyone else will be working from home. No offices full of people.
Everything is going to be different, and I don't think people fully grasp yet how fundamentally this country is going to be changed by the next month ahead of us. We'll come out of this, but it's going to be ugly. The pressures that were coming gradually over the next decade are coming in the space of one month thanks to COVID-19.
There are going to be huge breaks in the chain. Nightmare doesn't begin to describe it. The changes are being forced into a small time frame and it's going to be catastrophic for most of us.
I've been saying "Buckle up" for years now.
It's too late to buckle your seat belt when you're in the crash.
Boom.