NYC’s Upscale Takeout and Delivery Bubble Is Beginning to Burst

As the weather gets warmer and indoor dining capacities increase statewide, New York’s takeout and delivery bubble is beginning to burst. Several upscale restaurants — most recently, trendy red sauce spot Carbone and the two-Michelin-starred Momofuku Ko — have retired their takeout and delivery services in order to focus on expanding outdoor and indoor dining. Others, including Miss Ada, Llama Inn, Llama San, and Atoboy, offered takeout or delivery during the pandemic but have since ended those services.

“We’ve never liked the business,” says Juan Correa, co-owner of acclaimed Peruvian restaurants Llama Inn and Llama San, in an email to Eater. “The business fees are prohibitive, the food doesn’t travel well and honestly my team is tired.” Correa isn’t alone in his concerns. The decision to end takeout and delivery comes amid a wider shift in the hospitality industry, in which business owners are willing to sacrifice another possible source of revenue to focus on the customers sitting in their dining rooms.

Over the last year of coronavirus, restaurant owners across the city have reconfigured their business models and turned to untapped sources of income to stay afloat. For many high-end establishments, that’s meant making unprecedented forays into takeout and delivery, bringing Michelin-starred meal kits, $800 sushi sets, and make-at-home Korean barbecue to New York apartments for the first time.

The result of the pandemic-inspired innovation? New York City’s selection of restaurants offering takeout and delivery has never been this good — and may never be again.

Neither Momofuku Ko or Carbone offered takeout and delivery before the pandemic. Both restaurants debuted the services in the last year, first as a way to stay afloat and later to supplement their bottom line from outdoor and indoor dining. Other restaurants that fall in this category — too nice for takeout in normal times, but too persistent to fail during the pandemic — are now taking steps to return to “normal,” which often means life before takeout and delivery.

“It’s time to become the restaurant we were before,” adds Tomer Blechman, the chef-owner behind Fort Greene Israeli restaurant Miss Ada, which ended its takeout and delivery program earlier this month to focus on reopening the dining room.

Offering takeout and delivery was necessary at the start of the pandemic, according to Blechman, when the state-mandated shutdown of restaurants prevented indoor dining from serving customers indoors. “It was 100 percent of our revenue,” he says. Yet, as time went on and New York City reopened for outdoor dining, those services accounted for a smaller portion — roughly 25 to 30 percent — of Miss Ada’s business and more of its headaches.

During the pandemic, a select group of foods — stews, biryanis, enchiladas, and other saucy creations — have risen above the rest for their durability during takeout and delivery. Blechman serves many of these items in the form of mezze, containers of hummus, shawarma, and whipped ricotta cheese that “travel really well,” he says. But packaging other dishes, including the restaurant’s harissa chicken and za’atar salmon, two of its most popular orders, “didn’t feel the best.”

“I usually touch every plate that comes from the kitchen,” he says. “Whether I run it, plate it or cook it, I can see it and know that it’s right.” That level of consistency and care was not possible with more temperature-sensitive dishes, especially after an half-hour in transit.

Blechman says his staff also encountered issues with takeout customers and third-party delivery workers crowding Miss Ada’s front door and entering the restaurant to inquire about orders. There simply was not enough space in the restaurant’s indoor dining room to serve customers and process orders, he says. Returning to “normal” became a choice between dining and delivery.

“It was a hard decision to cut it off,” Blechman says. “We had a really good run with delivery, but we want to make sure the people sitting in the restaurant are getting the best service and food. We’re excited to get back to normal.”

Not all restaurants are as eager to leave behind the takeout and delivery programs they created during the pandemic. “When you consider a wider range of restaurants, I wouldn’t expect that to play out in the same way,” says Scott Landers, founder of Figure 8, a company that consults restaurants on how to offer takeout and delivery.

As indoor dining capacities increase, it’s likely more high-end restaurants will end their takeout and delivery offerings, especially those places that “got their name” from dine-in service, he says.

Yet many others, including those who operate out of storefronts with narrow sidewalks and smaller indoor dining rooms, have permanently reshaped their business models during the pandemic to include takeout and delivery. “Some restaurants have made more substantial investments in delivery and see it as part of the business long-term,” Landers says.

One such restaurant is Ugly Baby. When the Carroll Gardens restaurant reopened for indoor dining earlier this month — its first indoor service in over a year — chef Sirichai Sreparplarn brought back an expanded version of the takeout and delivery menu he launched during the pandemic. And it’s reportedly here to stay. “We plan on takeout and delivery being an integral part of our business going forward,” a spokesperson for the restaurant tells Eater.

In part, that’s because Ugly Baby has been able to avoid some of the problems that nudged restaurants like Momofuku and Miss Ada out of the takeout and delivery game. In addition to the open-air kitchen visible from Ugly Baby’s dining room, the Thai restaurant has a second kitchen downstairs, where staff can process takeout and delivery orders without affecting indoor service.

The dining room at Ugly Baby can seat 20 people at 50 percent indoor capacity, according to a restaurant spokesperson. Still, it’s not enough to leave behind takeout and delivery, even if the restaurant wanted to. “It started a stop-gap measure, but we need takeout and delivery to continue,” the restaurant spokesperson says.

• Inside Masa’s $800 Takeout Sushi Box [ENY]
• A Guide to the Best (and Worst) NYC Dishes for Takeout and Delivery [ENY]
• Thai Stunner Ugly Baby Reopens With a New Menu and Dine-In Service [ENY]
• What New York’s Restaurant Community Learned From the First Year of the Pandemic [ENY]