Restaurants and Drinking Places

The restaurant and drinking place sectors are booming in the United States after emerging from the two-year pandemic that shut down eateries and reduced revenue dramatically.¹

Full-service chain restaurants will continue to experience rising competition from fast-food and fast-casual restaurants that offer more value-oriented products as a more difficult economic climate is expected in the next 6 to 12 months.²

Even with strong growth, all sectors of the restaurant industry are still facing several challenges such as labor shortages, profit margin depletion from inflation, inclement weather complications, problems with app-based delivery drivers and ongoing food and supply chain shortages.³

It is also important to be mindful of posts on social media since underwriters are looking at these entries and reviews in their risk evaluation processes.⁴ Having a proactive strategy to address this aspect of the business is also part of a holistic risk management program.

As restaurants and drinking places continue to grow and work through these challenges, it is vital for owners to maintain adequate coverage and be proactive in mitigating risk.⁵

 

Retail

Worldwide retail sales are expected to grow at a 5% year-over-year (YoY) rate, which will exceed $27.33 trillion this year.⁶

With the acceleration of online commerce, brought on by responses to the pandemic, brands are increasingly turning to an omnichannel strategy to maximize their interactions with customers and create a holistic brand experience for their consumers.⁷

Like restaurants and drinking places, retailers may have higher sales figures in 2022 but are still seeing margins impacted by inflation and supply chain issues while also suffering from ongoing labor shortages.

Retailers are offering tools for consumers to connect digital and physical shopping experiences, like curbside click and collect, Metaverse shopping or QR code payment options.

 

Sources
1 2022 Restaurant Insurance Update | Modern Restaurant Management | The Business of Eating & Restaurant Management News
2 Industry Outlook – 72211a Chain Restaurants in the US – MyIBISWorld
3 2022 Restaurant Insurance Update | Modern Restaurant Management | The Business of Eating & Restaurant Management News
4 2022 Restaurant Insurance Update | Modern Restaurant Management | The Business of Eating & Restaurant Management News
5 2022 Restaurant Insurance Update | Modern Restaurant Management | The Business of Eating & Restaurant Management News
6 Retail trends that will shape 2022 (insiderintelligence.com)
7 Retail Industry Trends for 2022 and Beyond | Silicon Valley Bank (svb.com)