Trend reversal on the cards: COVID-19 may lead restaurants back to high streets from malls

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The COVID-19 outbreak might see popular brands moving back to the streets from malls, reversing a major trend in the Indian retail space.

Modern Indian retail had seen a huge shift of brands from the streets to the malls starting in early 2000.

Popular dining and QSR chains - McDonald's, Speciality Restaurants, deGustibus and Lite Bite Foods might be the first companies to make this shift, according to a report by The Economic Times.

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Moneycontrol could not independently verify the story.

Malls and restaurants are closed during the nationwide lockdown, which began on March 25. Home deliveries by restaurants are permitted, and some districts have allowed takeaways as well.

Restaurants might reopen in high streets first since the risk of infection is thought to be higher in malls, The Economic Times reported.

Other reasons for restaurants preferring the standalone establishments include consumer apprehension after malls reopen, restrictive timings and higher rentals.

Initially, business volumes in restaurants could be only 30-40 percent of pre-lockdown levels, industry executives told the paper.

Connaught Plaza Restaurants (CPRL), which operates 155 McDonald’s restaurants across north and east India, is looking at drive-through outlets as alternatives to sit-down meals and home deliveries, the report said.

Sanjeev Agarwal, chairman of CPRL, said has started drive-throughs lanes in the north and east for 17 of its restaurants, and is working on creating more.

Anjan Chatterjee, Managing Director of Speciality Restaurants, told the paper that high-street stores are not influenced by external factors such as footfall at malls. Such outlets are also free of common area maintenance charges that are imposed in malls, Chatterjee added.

Specialty Restaurants owns brands such as Mainland China and Oh! Calcutta.