Market Overview

Yelp: 61% Of Restaurant Closures Are Permanent

Yelp: 61% Of Restaurant Closures Are Permanent

Recent data from online review platform Yelp Inc (NYSE: YELP) shows that 61% of restaurant closures during the coronavirus pandemic are permanent.

Restaurant Struggles: The restaurant industry continues to struggle during the pandemic, and the results from Yelp's internal study aren't particularly encouraging.

Among the 32,109 restaurants marked as closed on Yelp as of Aug. 31, 61% are marked as permanently closed.

The most-impacted restaurants are those that specialize in breakfast and brunch, burgers, sandwich shops, dessert and Mexican cuisine, according to Yelp.

Bars and nightlife institutions face similar closure rates.

Among the 6,451 businesses that are closed, 54% are permanently shuttered. 

In contrast, foods that "work well" for delivery and takeout are seeing better-than-average closure rates, according to the Yelp data.

Some of those food categories include pizza, delis, food trucks, bakeries and coffee.

Retail Not Far Behind: Retail- and shopping-related businesses are showing slightly better closure rates compared to restaurants. Among 30,374 businesses that are closed, 17,503 will never reopen.

The highest rates of closures fall within the categories of home decor and men and women's clothing.

Closure Rates Vary By Region: Yelp's data shows that bigger states and metro regions with higher rent costs and more stringent local operations ushered in higher rates of closures.

Hawaii, California, and Nevada show the highest rate of total closures and permanent closures, according to Yelp. These states are also showing the highest unemployment rates.

West Virginia and the Dakotas boast the lowest closure rates.

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