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With commuting down, fast-food breakfast sales have slowed

Justin Ho Jun 11, 2020
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The largest share of Starbucks sales happen during the morning commute, but competition over breakfast sales has all but evaporated. Justin Sullivan/Getty Images
COVID-19

With commuting down, fast-food breakfast sales have slowed

Justin Ho Jun 11, 2020
Heard on:
The largest share of Starbucks sales happen during the morning commute, but competition over breakfast sales has all but evaporated. Justin Sullivan/Getty Images
HTML EMBED:
COPY

This week, Starbucks said the coronavirus pandemic will take an estimated $3 billion toll on its sales this quarter. Fewer people are walking into a Starbucks to get coffee, with the safety concerns and stay-at-home orders.

But Starbucks also makes a lot of money selling people breakfast along with their coffee. And with fewer people commuting these days, that revenue is drying up.

Up until the crisis, breakfast had been a battleground for chains like Starbucks, McDonald’s and Wendy’s.

Darren Tristano, CEO of Foodservice Results, said Starbucks’ strategy has been to offer more breakfast items, like sandwiches and baked goods, “in order to raise the check average and to give their customers more reasons to come in.”

Tristano said the largest share of Starbucks sales happen during the morning commute.

But as restaurants have adapted to the pandemic by offering more takeout and delivery, people have been mostly ordering like that for lunch and dinner, said David Henkes at Technomic.

“Breakfast has really been one of the casualties of this whole pandemic,” Henkes said.

He said the competition for breakfast dollars has all but evaporated. The new battleground is convenience.

“Any restaurant chain that’s had a drive-through or delivery system in place has held up better than others,” Henkes said.

He said that’s why Starbucks is investing more in pick-up-only locations.

COVID-19 Economy FAQs

What do vaccines mean for economic recovery?

COVID-19 is not going anywhere anytime soon, according to expert witnesses who testified at a recent hearing held by the Joint Economic Committee. Put simply, we can’t eradicate the virus because it infects other species, and there will also be folks who choose not to get the vaccine or don’t mount an immune response, according to Dr. Céline Gounder at NYU School of Medicine & Bellevue Hospital. “That means we can’t only rely on vaccination,” Gounder said. She said the four phases of recovering from the pandemic are ending the emergency, relaxing mitigation measures, getting to herd immunity and having long-term control.

Can businesses deny you entry if you don’t have a vaccine passport?

As more Americans get vaccinated against COVID-19 and the economy begins reopening, some businesses are requiring proof of vaccination to enter their premises. The concept of a vaccine passport has raised ethical questions about data privacy and potential discrimination against the unvaccinated. However, legal experts say businesses have the right to deny entrance to those who can’t show proof.

What do I need to know about tax season this year?

Glad you asked! We have a whole separate FAQ section on that. Some quick hits: The deadline has been extended from April 15 to May 17 for individuals. Also, millions of people received unemployment benefits in 2020 — up to $10,200 of which will now be tax-free for those with an adjusted gross income of less than $150,000. And, for those who filed before the American Rescue Plan passed, simply put, you do not need to file an amended return at the moment. Find answers to the rest of your questions here.

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