The Reason Sushi Is Giving Many Pandemic Era Restaurants A Boost

Sushi is on a roll - as it were - because people are growing concerned about pandemic weight gain - and they're increasingly tired of pizza, burgers and other takeout staples. JL

Heather Haddon and Jaewon Kang report in the Wall Street Journal:

Consumers say they are ordering more sushi because they have tired of other takeout, and it travels well. The number of sushi restaurants open in the U.S. grew by 5% last year as numbers for steakhouses and Italian restaurants fell. Sushi was the most searched takeout cuisine on restaurant platforms. Supermarket sushi sales were up 23.2% compared with the same period in 2020. “Burgers and pizzas become so heavy, especially when I’m trying to watch that pandemic 15.”

At a bleak moment for restaurants, sushi takeout is on a roll.

Customer appetites for to-go sushi are rising, from $10 grocery-store rolls to elaborate, exquisitely packaged meals costing hundreds of dollars. Japanese restaurants say the demand is helping them to stay afloat, and to reach new customers through delivery and to-go options. The number of sushi restaurants open in the U.S. grew by 5% last year as numbers for steakhouses and Italian restaurants fell, according to online-directory Yelp.

Kaho Lo, a 40-year-old software engineer from San Jose, Calif., used to get sushi weekly at his Adobe Inc. office cafeteria. During the pandemic, he tried making it himself but found it hard to find high-quality fish. Seasoning the rice and forming it into rolls proved challenging, too, and he hasn’t done it again.

“When there’s a spot that offers sushi for takeout, I’m all over it,” Mr. Lo said.

High demand for sushi comes at a dark time for restaurants overall. Sales at restaurants and bars of $659 billion last year were down by nearly a quarter from 2019, according to National Restaurant Association estimates, and more than 110,000 bars and restaurants closed at least temporarily. Employment at bars and restaurants is down by nearly 2.4 million, Labor Department estimates show.

The devastation has been particularly acute among independent, full-service restaurants. Small operators run nearly all U.S. sushi restaurants, according to industry data. Not all have done well during the pandemic. Japanese restaurants in many cities have closed, and publicly traded chain Kura Sushi USA Inc., said same-store sales were down 51% at the end of last year compared with the same period in 2019. Sustainable Restaurant Holdings, owner of the Bamboo Sushi and QuickFish chains, declared bankruptcy in May.

Sortis Holdings Inc., a Portland, Ore.-based investment firm that bought nine of Sustainable Restaurant’s 12 locations out of bankruptcy, is running five Bamboo Sushi locations for takeout only. Food sales in the past three months of 2020 there were up around 3% compared with a year earlier, Sortis Chairman Paul Brenneke said.

Sushi was the most searched takeout cuisine on restaurant-reservation platform Tock Inc. during the last three months of 2020. Sushi transactions processed by restaurant-management platform Toast Inc. grew 56% from March to December, more than the increases in Thai, Tex-Mex or Indian sales, data from the firm shows.

Grocers are also selling more sushi. Supermarket sushi sales were up 23.2% in the four weeks ended on Jan. 23 compared with the same period in 2020, according to Nielsen data. Overall grocery sales grew by 12.5% last month.

Los Angeles-based Erewhon Market is selling about $3,000 worth of sushi per store a day, 10% more than before the pandemic, said CEO Tony Antoci. He said restaurant closures have lifted the chain’s sushi sales: “We’re the next best thing” to sushi restaurants.

Steve Smith, CEO of K-VA-T Food Stores Inc., which operates more than 100 Food City stores in Southern states, said he is struggling to train staff to make sushi rolls fast enough to meet demand. Some customers say watching grocery-store workers roll their sushi is part of the appeal.

“You kind of feel like you’re at a sushi restaurant,” said Lucas Bane, who said he buys sushi from H-E-B LP in Texas once or twice a month. He got sushi from Whole Foods Market for his birthday last year.

Some consumers say they are ordering more sushi because they have tired of other takeout, and it travels well.

“Burgers and pizzas become so heavy, especially when I’m trying to watch that pandemic 15,” said Jenny Ross, a 29-year-old hospital-care manager from Portland, who said she regularly orders around $60 worth of rolls and nigiri.

New York-based Masa, a restaurant group whose flagship location has earned three Michelin stars, started selling $800 sushi boxes with homemade soy sauce and takeout containers imported from Japan during the pandemic. Masa has rented cars to deliver orders to regulars across the city and surrounding suburbs. Demand has justified the efforts, with some regulars ordering weekly boxes, Masa Director of Brand Strategy Jeannette Park said.

Ms. Park said she and other members of the executive team often box up the meals and help deliver them themselves.

“It’s not efficient but we want to make people happy,” she said.