This piece is the first installment of an ongoing series of L.E.K. perspectives on the impact and responses to the crisis

We’re publishing a series of insights and perspectives on how COVID-19 is impacting the foodservice industry. Our goal is to help our clients in the foodservice industry monitor key developments and share best practices during this unprecedented period. At the same time, we acknowledge that the pandemic is a humanitarian crisis first and foremost. We at L.E.K. Consulting extend our heartfelt sympathies to all who are affected by this crisis.

The coronavirus crisis has created disruption of unprecedented scale for the food and beverage industry, and the impact on foodservice and grocery retail could not be more divergent.

The need for social distancing and “stay at home” orders across the U.S. has resulted in restaurants across the country shutting their doors for dine-in patrons. Most non-commercial foodservice has also screeched to a halt as many hotels, airports, stadiums, cruise ships, offices and other operations have shut down. Many are struggling to “keep the lights on.” Healthcare, corrections and some K-12 education facilities are still active.

Meanwhile, grocery retailers are struggling to keep up. Foodservice operators are scrambling to assist, with new partnerships with grocery retailers being formed at breakneck pace. Distilleries are turning into mini “hand sanitizer factories” to help out with the shortages.

The next big wave of help and shifting of resources across channels is going to come in the form of labor. COVID-19 is creating “the fastest relocation of labor since World War II,” according to The Wall Street Journal. Grocery retailers and grocery delivery services (e.g., Instacart) are hiring workers by the hundreds of thousands — and many of them are coming from the large pool of freshly unemployed workers from the foodservice industry.

The virus has created a lot of unknowns about our future. The days ahead will bring heartbreaking stories of foodservice operations shutting their doors. But one thing we are certain of is the creativity and resiliency of this industry. We will do our part to share key developments and creative solutions we’re observing in the industry through this multi-part series. This will include a range of topics, such as the magnitude of the short-term shift from retail to foodservice and the longer-term impact, stories of increased efforts toward takeout (including first-time offerings for many high-end restaurants), drive-thru initiatives to drive sales, creative new revenue streams for foodservice operators and suppliers (e.g., direct to consumer, meal kits, etc.), efforts to streamline and focus operations, and other key developments. The industry will bounce back, and we will work hard to be a resource to help accelerate the recovery effort.