The U.S restaurant industry has lost $120 billion of revenues from March to May this year due to the coronavirus, according to a definitive National Restaurant Association survey of 3,800 restaurant operators. Founded a century ago, the National Restaurant Association’s flagship survey is widely considered second only to government statistics. According to the Association’s chief economist, lost revenues for the full year are still expected to exceed $240 billion.

The industry’s lost revenues by month can be roughly broken down as follows:

• March: $-30 billion
• April: $-50 billion
• May: $-40 billion

According to interim data from the U.S. Census Bureau, eating and drinking places generated sales of $38.6 billion on a seasonally-adjusted basis in May. That is roughly $9 billion higher than April, but still roughly $27 billion lower than pre-COVID-19 revenues in January-February 2020. “May sales were more than 40 percent lower than what would have been expected in the absence of the pandemic,” wrote Bruce Grindy, the Association’s chief economist.

In addition to quantitative research, the survey also asked qualitative questions of restaurant operators. Alarmingly, 75% of operators do not expect to achieve profitability within the next six months. “Despite the sales uptick in May, the restaurant industry’s business environment is far from normal, and overall losses continue to mount,” Grindy explained. Bloomberg restaurant analyst Michael Halen does not predict a full recovery for restaurant industry revenues until 2022.

At the height of the pandemic, the U.S. Bureau of Labor Statistics admitted that 8 million restaurant employees were out of work. Restaurants have lost three times the number of jobs than any other major industry. At the worst moment of the crisis, revenues for restaurant groups declined -26%, -55%, -61%, or as much as -89%, depending on their location. In downtown areas like San Francisco and New York City during the middle of March, revenues ceased completely.

Of the 2.5 million total jobs added nationwide in May across all industries, nearly 1.5 million jobs were added at restaurants and bars. Many of these rehires were assisted by funds from the U.S. Small Business Administration’s Paycheck Protection Program (PPP). The PPP Flexibility Act was signed into law this month, lengthening the period for loan forgiveness from eight to 24 weeks, and reducing the payroll expenditure requirement from 75% to 60% of the loan principal.

The coronavirus pandemic continues affecting restaurants disproportionately. Just today, 18,577 new cases have been added, including 500 deaths. Total cases amount to 2,104,346 with 116,140 deaths. A graph of new U.S. COVID-19 cases, per the U.S. Centers for Disease Control and Prevention, appears below with data as of yesterday, which is heavily skewed to the downside due to New York City remaining closed longer than expected.

Photo by kaleb tapp on Unsplash

In late February, estimates for the duration of COVID-19 lockdowns lasted just a couple weeks. Yet here restaurant owners are today, three months later and $52 billion poorer, with restrictions only mildly eased and waves of protests rolling across the country. “Flattening of the curve!” tweeted President Trump almost two months ago. “Two weeks to flatten the curve has become three months to decimate the state,” points out one observer. “It was originally two weeks to flatten the curve. It’s now 10 weeks,” says another.

For Michelin starred chefs, two weeks could turn into nine months. “It’s not going to be easy, but we are definitely reopening,” says Eric Ripert of Michelin 3-star restaurant Le Bernardin. “September or October at the latest.” Fellow New York City chef Danny Meyer agrees, “We won’t be welcoming guests into our full-service restaurants for a very long time — probably not until there’s a vaccine.”

In mid-May, only 13% of Michelin-starred restaurants were open globally. Generally expected to be the last class of restaurant to reopen, Michelin diners care as much about ambiance and service as they care about food quality. With masks and social distancing undermining the enjoyment of fine dining, most restaurateurs have simply opted to wait.

“We will probably have a smaller menu with less choice,” Ripert said. “We’re going to have to make some very big sacrifices at the beginning.” Alongside Ripert, the two other chefs in New York City with Michelin 3-star restaurants are opting out as well. Thomas Keller’s 3-star Per Se is silent on social media about reopening plans, and Daniel Humm has temporarily donated his 3-star Eleven Madison Park kitchen as a commissary for underprivileged residents. He still plans to remain closed indefinitely, with reporters at Bloomberg skeptical that he will ever reopen.

On Thursday, all three chefs participated in a benefit event in Times Square, calling on insurance companies to extend business interruption insurance benefits to affected restaurant owners across the country. “We need to shine a light on the need for federal support and fairness from insurance companies,” tweeted Ripert on Thursday. All three chefs are members of the Business Interruption Group which organized the event, a 15.6 million member lobby seeking insurance relief for restaurateurs. The three chefs are also members of the Independent Restaurant Coalition, founded three months ago. Individually, Keller advises the White House directly as a member of the Food & Beverage Great American Economic Revival Industry Group (GAERIG), formed by President Trump on April 14.

In San Francisco, Michelin 3-star chefs are actively lobbying as well. Dominique Crenn of 3-star restaurant Atelier Crenn retweeted Amnesty International yesterday, “Peaceful protest is a human right.” Before the pandemic, Crenn employed 70 people. Today, she is “in the process of imagining the post-pandemic world she wants to see” with no calendar date for reopening. 

Fellow 3-star San Francisco chef Michael Tusk is silent on Twitter, as is his Quince partner Neil Stetz. Corey Lee and Brandon Rodgers of San Francisco’s 3-star Benu have no calendar date for reopening, although they are serving scheduled takeout meals.

Patrick O’Connell of 3-star The Inn at Little Washington has decided to reopen, one of the first to do so in the country. The Inn is offering “a new dining experience” starting this weekend. According to reporters at CBS, that will include masks, gloves, sanitizing equipment, a limited menu, and mannequins to prompt social distancing. 

“It all came out of the necessity for creating space between tables,” says the starred chef about his increasingly popular choice to place mannequins in empty dining room seats. “Even if you should arrive and be the only party for a while, you feel like you’re not alone,” says O’Connell. “They’re creating a little narrative. One man is proposing on bended knee to his girlfriend, and she’s looking very surprised. The others are trying to figure out what is going on at that table and turn to stare. They’re all drinking wine. And this allows our waitstaff to play.” O’Connell’s attempt to trend the hashtag #ManniSelfie has earned no posts on social media as of today.

Almost all chefs have been participating in Congressional lobbies for restaurant industry relief. This month, they successfully convinced the House of Representatives to pass the Paycheck Protection Program (PPP) Flexibility Act, which could eliminate key restrictions on the use of billions of dollars in fiscal aid. The U.S. Small Business Administration (SBA) has exhausted over 77% of PPP funding to date. Restaurateurs are also championing Microloan debt forgiveness. SBA Microloans are designed to assist low income entrepreneurs, including restaurant owners.

Michelin director Gwendal Poullennec has told reporters at AFP in France that this year’s rating will not be delayed. Michelin competitor Gault & Millau will also publish its guide on-time, although it is delaying rankings for individual chefs and sommeliers.
Another Michelin competitor in the United Kingdom, 50 Best Restaurants, has cancelled its 2020 ranking outright.

Photo by bady qb on Unsplash

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In This Episode…

We talk with Matt and Jessica Ray, owners of Livingoods Restaurant & Brewery in Peru, NY. With an extensive upscale-casual menu that truly has something for everyone, and a full-fledged brewery operation about to launch, this husband and wife team bring two lifetimes of experience to their establishment, with amazing results.

Listen in and hear:

• How Matt has carefully planned the brewery operation, finding a new location to house it and crossing hurdles with various government organizations along the way
• The methods Jessica uses to leverage Facebook and social media to drive business to their restaurant nightly
• How Livingoods’ gourmet menu manages to offer something for everyone, meat-lovers and vegetarians alike, with high-quality ingredients and local sourcing
• How a move to a new location last year (after 9 years in the same location) has changed their business and marketing strategies

Find out how Matt and Jessica got started in the industry and initially funded their restaurant, and how they made the shift to a new location with an in-house brewery, a special events hall, live music and ongoing support of local charities to support their community.

Featuring authentic ingredients almost exclusively made from scratch, Livingoods does not compromise on its menu which includes including over 7 gourmet burgers, Mexican, Italian, vegetarian and seafood dishes. Matt and Jessica fill us in on how they continually train their kitchen staff on new methods to get the best possible results from their chefs.

Find Livingoods Restaurant & Brewery on the web at:
livingoodsrestaurant.com

Be sure to subscribe to the show in iTunes by clicking here.

In This Episode…

We spoke with Greer “Peaches” Fredericks, who started Mama’s Boy Southern Table & Refuge Restaurant a year ago in Norwalk, Connecticut. With an authentic southern menu, Mama’s Boy has generated a big buzz in short time – and even been reviewed in the New York Times and featured on The Cooking Channel!

Listen in and learn:

• Why Mama’s Boy was a lifelong research project for Greer, and how it finally all came together a year ago
• The unique ways Greer keeps her customers loyal and feeling appreciated
• Why creating the ambiance of Mama’s Boy has been a labor of love, and how it has contributed to such success

Find out how Greer spent years cataloging and refining her ideas until her dream restaurant finally came to be, and how she continues to manage it today with a unique perspective on what Mama’s Boy’s offers to to their customers.

Featuring authentic menu items like southern-style Shrimp & Grits, Grilled Fried Chicken Biscuits, Four Cheese Mac n’ Cheese, and desserts like Coconut Cake and Chocolate Pecan Pie, Mama’s Boy is an experience of the South that east coast residents might otherwise never have. In addition, Mama’s Boy’s famous Sunday brunch features live music, and was part of Greer’s business plan from the beginning.

Greer also shares the one thing she might have done differently starting out her restaurant, while recognizing it was probably meant to be!

Find Mama’s Boy Southern Table & Refuge on the web at:
mamasboyct.com

Be sure to subscribe to the show in iTunes by clicking here.

In This Episode…

We spoke with Tiffany Lach, who started Sola Café & Bakery in Bozeman, Montana six years ago – and recently opened Red Tractor Pizza less than two miles away. You’ll hear about:

• Tiffany’s lifelong experience in the restaurant industry, which started helping at her father’s five restaurants
• How Tiffany manages a farm-to-table philosophy and gluten-free options for her loyal fan base
• How a kitchen fire led to a new location and resulted in a second, completely different restaurant
• Why continuously supporting cultural events and donating to local charities has been instrumental to her business

We learn why Tiffany made the decision to offer gluten-free options from the very beginning and what was behind it. She shares her menu strategies and the reasons for her focus on sourcing ingredients locally – and how she manages such a diverse selection.

Specializing in breakfast, lunch and decadent (yet allergy-free) baked goods, Sola is a hit with both locals and tourists that visit Bozeman. Red Tractor Pizza offers “the best gluten-free crust ever”,  soy-free options and even dairy-free pesto! Every pizza is hand-made in an enormous wood-fired brick oven that has been built-in to the building for decades.

Tiffany, a lifelong entrepreneur, offers a unique perspective on how she makes things work so well at both restaurants, and how different marketing techniques have worked for her over the years.

Find Sola Café and Red Tractor Pizza on the web at:
solacafe.com & redtractorpizza.com

We’ve revamped and relaunched our Restaurant Engine Podcast!  This is the first of many interviews we’ll be doing with restaurant owners to hear the stories of how they started and grew their restaurant business.

Be sure to subscribe to the show in iTunes by clicking here.

In This Episode…

We spoke with Steve Perlstein and Jennifer Block, who started Simmer Milwaukee food truck a year ago. You’ll hear all about:

• Why Steve and Jennifer turned to Kickstarter to fund their food truck
• How local press and community engagement started their business with a loyal fanbase
• Why Steve left a successful career in journalism to pursue his dream of being a chef
• How they manage their food truck while planning their brick-and-mortar restaurant

We also learn why Steve and wife Jennifer made their decision to start with a food truck instead of a traditional restaurant. The pair expand on their menu strategies, specialty bakery items, a focus on sourcing ingredients locally and the process of delegating management so they can continue to expand their business.

Specializing in freshly-made soups and paninis with a daily selection of both vegan and gluten-free options, Simmer offers something unique for everyone – and it’s paying off. In addition to Simmer Truck, Simmer Catering is a major part of the business also – from weddings to street block parties, office lunches to charity dinners, Simmer makes the most of its’ mobility!

In fact, things are moving quickly – this November they will be opening a brick-and-mortar restaurant, Simmer Café, while keeping their food truck business going strong. We had a lot of fun talking with this creative team and know they’re only just getting started! Tune in to the podcast to hear all about Simmer’s rise to success!

Find Simmer on the web at:
www.simmermilwaukee.com

MP3 Audio

In this episode of the Restaurant Engine Podcast, we discuss the essentials to starting your own food truck business. You’ll learn what type and size of truck to go for along with the proper starter equipments you should prioritize on acquiring. You’ll also be introduced to what paperworks are required to running a food truck plus business suggestions and marketing tips to get things rolling. All these are covered in this episode of the Restaurant Engine Podcast.

Run a food truck?  Find out more about Restaurant Engine’s food truck website design solution.

MP3 Audio

In this very first episode of the Restaurant Engine Podcast, we discuss six important steps to think about when you’re building your restaurant’s business plan.  Building your business plan is an important step for any new restaurant business and shouldn’t be taken lightly.  From the concept to branding and marketing to financials.  It’s all covered in this opening episode of the Restaurant Engine Podcast.