Against all Odds. Open a new Restaurant!

August 14, 2020

Against all Odds. Open a new Restaurant!

COVID-19 has changed life as we once knew it in the United States. Months since the initial outbreak, we still find ourselves in uncertain times. The food and beverage industry has been particularly affected, with restaurant owners fearing a second shut-down in the future. Many smaller businesses didn't survive the first one. But even as some restaurant operators close their doors for good, others are opening theirs for the first time.

 

Beating the Odds

It might not seem like a good time to open a new business, especially in the restaurant industry. Regardless, some foodservice entrepreneurs have beaten the odds with a lot of hard work, re-strategizing, and strict adherence to CDC guidelines. Most of these new business owners were well underway with their plans when the novel Coronavirus began causing shutdowns in early March.

New restaurants don't pop up overnight, but rather require months of planning and preparation. Since a delayed opening would mean losing a lot of money, some small business owners like Amalia Litsa and Joshua Adrian had no choice but to open. Their cafe, Dear Diary Coffeehouse, opened on April 4th after a stay at home order was put in place.

Litsa said that opening was their best chance for survival and that they have had to find ways to adapt to new obstacles in the foodservice industry. She sews face masks during slow hours, which are for sale at the register. They have also had to make changes to their business model to sidestep issues in the supply chain. “No matter what, we’re going to operate at a loss, but even a weak revenue stream would slow that loss,” says Litsa.

 

Unique Challenges

Opening a new restaurant in a pandemic may have its challenges, but it's not impossible. From New York City to San Francisco, dedicated business owners have been overcoming obstacles, and learning to navigate through the uncertainty. Some restaurant groups have even successfully expanded to a second location.

Several women have opened restaurants in the metro Detroit area since the outbreak of COVID-19. When asked what the biggest challenge of this Coronavirus situation was, their answers ranged from staffing to keeping up with local mandates. Mo Marzullo, co-owner of Matt & Mo's, said the hardest thing has been the general public. The Chicago-style Italian beef stand and ice cream window opened mid-May and offers walk-up service. Their face-covering requirement has sparked quite a few incidents of aggression and personal attacks in their online reviews.

Nancy Diaz, co-owner of Mexican restaurant La Palapa del Parian says the supply chain was her biggest stress factor at first. Now she worries that the spread of COVID-19 may cause a second round of shut-downs. Diaz felt that it was the right thing to open amid the pandemic and provide work to those who don't qualify for unemployment insurance. Foodservice and gig economy workers eventually received some relief with unemployment insurance expansions, though they expire soon.

One of the biggest challenges all restaurant workers face is uncertainty. It's hard to construct a business plan when you don't know what next week will bring. “It’s constantly trying to roll with those punches and make sure we’re making the best decision for our business, staff, and guests," says Executive Chef Allie Lyttle of Lala's—a Southern-inspired pop-up in Ann Arbor. Staying on top of every executive order and guideline is a constant struggle.

 

Best Practices and Guidelines

The Center for Disease Control, FDA, and the National Restaurant Association have all released opening guidelines for the food industry. These guidelines aim to slow the spread of COVID-19 through food safety, social distancing, employee health monitoring, and enhanced cleaning and sanitation. Most of these food safety practices have existed in the food industry for ages, like thoroughly cleaning food contact surfaces and prohibiting sick employees from working. Others, like providing hand sanitizer to diners, are new.

Some CDC recommendations are mandated by state and local public health orders, so it's important that restaurant workers stay up to date. In some places, face coverings are required—especially in small dining rooms where close contact is inevitable. Employees should never touch ready-to-eat food with their bare hands, and they should utilize single-use items like disposable gloves. The National Restaurant Association also recommends that business owners post signs and floor markings to encourage social distancing.

To ensure that restaurants and bars have the proper COVID-19 safeguards in place before opening, the CDC posted a checklist to help with decision-making. Some items include planning for if an employee gets sick, as well as having flexible sick leave policies. Restaurants should also encourage drive-through, pickup, and delivery services to promote social distancing.

 

Adapting and Re-Strategizing

Although the CARES Act expanded loan programs provided by the Small Business Administration, many small businesses in the food and beverage industry are still seeking relief. Paycheck Protection Program funds ran out in the first week, and the rollout left small businesses disadvantaged. Restaurant groups continue to put pressure on the federal government to divert more resources to the Small Business Administration in the next relief act—but for now, they're finding ways to adapt.

New restaurants may actually have a slight advantage over established, popular restaurants in that they have fewer expenses when it comes to staff. The owners of Dear Diary Coffeehouse chose to open without any staff and run the cafe on their own for now. Because a lot of people are still staying at home as much as possible, new restaurants can't rely on foot traffic as they would have before. Instead, restaurant workers are using social media to promote their new businesses.

Online ordering has been the name of the game throughout this Coronavirus situation. Many restaurants are surviving solely off of takeout and delivery orders. Apps like Uber Eats have waived commission fees for the rest of 2020 and just announced new tools for restaurant managers last week. A lot of businesses are also utilizing outdoor seating to comply with social distancing guidelines.

Against all odds, restaurants are finding ways to open and stay open during this pandemic. Diners are still eager to give their business to local restaurants, even if it isn't in person for a while. In the face of adversity, communities always come together to provide support.



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