Dive Brief:

• Restaurants and bars in Washington State must close their indoor dine-in service beginning at 12:01 a.m. on Nov. 18, according to new guidance issued Sunday by Gov. Jay Inslee. The restrictions will expire Dec. 14, unless extended or revoked earlier.
• Outdoor dining and to-go service will be allowed, but table size for outdoor dining is limited to five people. 
• Washington joins a growing list of states and cities reversing course and shutting down dining rooms following an exponential rise in COVID-19 cases in the last two weeks. Oregon, New Mexico and Michigan have also issued new dining room restrictions. Oregon and Michigan’s guidance goes into effect on Wednesday, while New Mexico’s restrictions took effect Monday. 

Dive Insight:

Much like the rest of the country, Washington is seeing record positive cases of coronavirus in the last week, with daily cases averaging 1,865, an increase of 124% compared to two weeks ago, according to The New York Times. Washington was the first state to see positive cases in March and was among the first to close restaurants dining rooms. Its latest ban likely won't be the last, with several states already issuing or considering a reversal in course on restaurant reopenings.

A new wave of restrictions come at a time when many restaurants were starting to see some signs of recovery as dining rooms were allowed to reopen. A reclosure of dining rooms could be a death knell to more restaurants by the end of the year. About one in six restaurants have already closed and the industry is on its way to losing $240 billion, according to the National Restaurant Association. While some cities that have issued dining room bans are also providing grants to impacted restaurants, including Chicago and San Francisco, a lack of a nationwide stimulus package will continue to put more restaurants at risk. Restaurants facing new restrictions are also bracing for more layoffs.

The bans will likely have a mixed impact for those that would have stayed open during the Thanksgiving holiday. While Thanksgiving is typically a slower time for restaurants, Thanksgiving Eve, also known as "Drinksgiving," tends to be one of the busiest days of the year, especially when it comes to alcohol sales. 

Unlike the early days of the pandemic, many restaurants have already pivoted to offering robust delivery and takeout channels, including alcohol to-go where allowed, which could make new closures easier to weather. Consumers are also much more used to ordering online, and digital orders increased 138% during the third quarter compared to the previous year’s third quarter, according to The NPD Group. 

These indoor dining bans also have end-dates this time around, allowing restaurants to plan for a return of patrons in December. Many restaurants have also started winterizing their outdoor dining areas, which could allow patrons to continue coming back in areas that still allow outdoor dining. There are also vaccines in the works, two of which have shown high success rates. Pent up demand for dining out also remains high, meaning patrons will likely return when they feel safe and secure and have money to spend on on-premise dining.