I used to own a fast casual restaurant. So when I read stories like these:
Restaurants seek government help amid coronavirus pandemic
David Chang isn’t sure the restaurant industry will survive Covid-19.
Restaurants Owned By ‘Top Chef Canada’ Contestants Say A Bailout Is Necessary
I sympathize with the restauranteur, old and new facing unprecedented pressures in light of COVID-19. While the federal government has stepped up to provide wage subsidies as well as small business loans to the industry, there is still much to be done.
Restaurants tend to operate on a very thin margin. Inventory, labour, loan repayments and rent are usually the largest expenditures. The tricky thing is that there is very little flexibility on how to manage them in times of stress. A restaurant cannot stockpile inventory for a time being to sell off at a later date. Food of course expires and therefore must be converted into meals to be sold immediately. Right now, labour is being managed either by cutting back on hours or laying off employees. The government’s wage subsidy will hopefully enable many restaurant owners to keep as many of their employees on payroll as possible.
Lastly is the matter of loan repayments and rent. I know from my own experience these were the bane of my existence. As a new restauranteur they always loomed over my head. Both amounts were fixed expenditures and both landlord and banks were often in no position to provide any flexibility on payments. Understandably for their own reasons, as they too have expenditures and income they are relying on for their own businesses. The government is providing some aid to this measure, but from what I’ve seen it’s mostly in the form of loans. However, if many restauranteurs were like me, the last thing they wanted to hear is to take on more debt.
Which is why the movement of #onetable caught my eye. Restauranteurs are not ones to sit around and wait for a problem to fix it themselves. They are proactive by nature so I’m not surprised they are taking action to protect their investments and businesses. Their website lays out a comprehensive plan to keep restaurants open post COVID-19. Visit it here. I highly recommend you take a look at this video as well.
At this point I think the government has done an exceptional job in providing aid to small businesses. This isn’t something that is only the government’s responsibility though. It is in the best interests of landlords and banks to find ways to help defer rent and loan payments until after this crisis has past. My reasoning for that is more than I have space left in this post for. I’ll continue it in a second posting tomorrow.
3 thoughts on “I have a soft spot for restauranteurs”