How the coronavirus crisis has upended the restaurant business, leaving us with a changed landscape
Faced with empty tables and many thousands of people forced out of work, an industry pivots and hopes.
The hubris that leads millions of men and women into the uncertainty that is the restaurant business is the same confidence that will drive the industry’s future.
And now, faced with empty chairs and barstools — the sudden, utterly unimaginable side effect of a temporary government shutdown of dining rooms and bars designed to combat the spread of coronavirus — they have pivoted.
And they hope.
Hope that moving to carryout and delivery will keep the lights on until order is restored and the world calms down.
This week, thousands of people were forced out of work literally overnight: cooks and waiters, bussers and hosts, dishwashers and reservationists. Many of these workers were already scraping by, earning just minimum wage. All of the bartenders, a profession whose opportunities and cachet have grown meteorically in the last decade, are idled since they cannot sell that $12 merlot or that $15 purple woo-woo to go.
“I laid off 700 people today,” Dave Magrogan, who owns 11 restaurants, including Harvest Seasonal Grill & Wine Bar, told me Monday. “Worst day in my career.” With 98 employees left, including 45 managers and three corporate employees to handle payroll and unemployment claims, Magrogan has converted his restaurants to takeout and delivery. He knows that this move will generate a fraction of usual sales.
Hope for employees.
Even facing the loss of income, Magrogan is selling gift cards to give all proceeds to his staff. Other restaurateurs are doing this — the big guys such as Michael Solomonov and Steve Cook, who temporarily closed their entire 400-employee empire, including Zahav, Federal Donuts, and Abe Fisher, and smaller operators, such as Yianni Arhontoulis, whose six employees at his BYOB, Mica, in Chestnut Hill, have been idled. “The response has been impressive,” Arhontoulis said. “People are buying five, six hundred dollars in gift cards.”
For now, restaurants have cut most hourly workers and are having salary people do the work. Exactly how long this modified business model will work is anyone’s guess.
It’s clear that the restaurant business will not be the same. In the short term, people will patronize local establishments for their pickups and deliveries, rather than drive miles into different neighborhoods.
“I know people are going to get stir-crazy and tired of eating the same things they hoarded from the supermarket," said Peter Hwang of SouthGate, a Korean-influenced bar-restaurant in the Graduate Hospital neighborhood. "So as long as they’re doing their best to be safe, we’ll be doing our best to be safe and sanitary so it couldn’t hurt to support a neighborhood spot,” he told The Inquirer’s Julia Terruso.
Hope that landlords and vendors can work with them, extending credit. Trade groups are lobbying for relief, but it will come down to what the industry has always relied on: trust.
Restaurants do not do well with disruptions, whether it’s a few days off from a snowstorm or a visit by a pope. The water main break around 13th and Sansom Streets, which diverted traffic for a year, was a 15% hit to the bottom line of Zavino, said founder Greg Dodge. That incident aside, Dodge said it’s a truism that “one bad week can kill two good weeks.”
Restaurants are also coming off their typically lean months of January and February. St. Patrick’s Day usually augurs a rebound that builds until Mother’s Day and graduation parties and outdoor dining.
Prolonged bans will reshape the landscape. Restaurants will close permanently. Though the let’s-enjoy-a-night-out social side of restaurant dining will return someday, habits will change. People may elect to cook and entertain at home more, especially if they feel they can’t afford to dine out.
“We adjust and we adapt,” Keith Taylor, who owns Zachary’s BBQ & Soul in Norristown, told me, a day after he received $16,000 in what he called corona cancellations. “That is the plan and we have heard over the years to keep three months of contingency money set aside.” An extended road closure almost put him out of business in 2013.
“The bad thing is that we do not know how long we will be in this mess,” Taylor said. “The good thing is that I am very confident of how good things will be when things calm down. In the meantime, I’m loving hanging with my kids, and teaching them how to laugh during the toilet paper and handwashing hysteria of 2020. My experience in business tells me if the good Lord brought you to it, He will bring you through it.”
Meanwhile, a few notes:
Customers may stay healthier by calling ahead for carryout or pickup, rather than by walking into the restaurant and waiting for takeout; the less time spent in public, the better.
Many restaurants are offering curbside pickup as a potentially more sanitary alternative to a delivery service (since the customer can control the order from point of pickup). Though restaurants say they’re stepping up their hygiene, the most fastidious among us will point out that food boxes and containers can carry the virus and need to be disinfected.
Delivery services Grubhub, DoorDash, and Caviar are allowing “no-contact” delivery, meaning that drivers will call or text when they arrive and leave the order in a safe place for the customer to take inside. Grubhub is delaying (but not eliminating) the collection of its commission from restaurants.
Customers can help by buying restaurant gift certificates, books, and merchandise, such as T-shirts. These items act as microloans.