How can bar and restaurant businesses survive the COVID-19 pandemic? What should they be doing right now? How do you plan for future success in challenging times?
Bar & Restaurant assembled industry thought-leaders, experts and allied partners to share their insights and advice. From being flexible to looking at efficiencies in operations, to negotiating rent and elevating your take-out experience, here’s what some experts had to say in part one of this series.
“It is so important for restaurant and bar owners to become extremely flexible and learn to adapt during these unprecedented times. The secret sauce is learning to pivot daily, instead of monthly or weekly. We can’t afford to wait around for the next big or small change that’s enacted on a local, state or national level; we simply have to be prepared and abide by the new rules that keep coming our way.
Most recently, in the state of New York and New Jersey – where my restaurants are located – we had to learn to adapt to another new normal: socially-distanced outdoor dining, a 25 percent indoor occupancy rule and a 10 p.m. curfew. We had to think strategically and recently made a decision to take our last seated diners at 8:30 p.m. – as none of us should be risking time protocols and customers staying in-house past curfew. We also want to ensure that we are still giving the same quality – and non-rushed – dining experience to our customers that we have always given them pre-pandemic. Restaurants are a home and community for patrons and the experience should not fall short of what they are used to, ever.
My biggest tips for fellow business owners, which has been my No. 1 personal strategy since the pandemic began, is to focus on capital and team preservation in the short term unknown. This should be the case now and six months from now. Restaurant and bar owners must learn to work with tighter inventory (have to find a way to limit food and beverage inventory that is not selling right now) and potentially consider a limited menu that incorporates the top-selling items and a selection of other options, if that means saving the restaurant’s overall capital and overhead costs. We have to be 100 percent entrepreneurial, as this is absolutely not the time right now to rely on traditional systems. We all love systems and those will return when things get better, but we MUST adapt to a new set of rules and get creative to keep things moving forward, while keeping our No. 1 asset in place – our staff. Six months from now, if the lights go back on at 100 percent occupancy and we don’t have our signature staff and service culture intact – because we were careless with spending and inventory – then we miss an integral part of what makes us what we are and the formula to thriving successfully. The second we have no staff, we're simply tables and chairs – we lose our identity and have another problem, instead of getting right back to the day-to-day grind; we're spending all of our time and hours finding new staff.
At Triple T Hospitality (a suburban operation), we have been doing extremely well and we have been able to keep every one of our staff members on the payroll and also hire more, given we have new locations coming soon. In some ways, this time was a blessing for my operation, as I have been able to secure real estate that was never available in previous years, like my new Tommy’s Tavern + Tap location in Clifton, N.J., which was previously a high-traffic location for TGI Fridays. I’m also gaining top operational and culinary talent from major city restaurants, due to the exodus to the suburbs."
Owner / Principal
GP Hospitality Partners LLC
“Start by looking at efficiencies in your operation. We can usually do less with more, and in a time where sales may be dropping dramatically, controllable costs must also be put in check. How can you restructure your operation to streamline the process? Can menus be simplified to reduce steps in production and decrease inventory being held? Can you offer to-go items that are easy and less expensive to produce in order to improve margins? Can some employees take on different roles to allow for greater productivity, reducing labor expenses?
Next, consider creative promotions that cater to the current environment. Make it easy for a family of four or more to order takeout or delivery with family meal deal packages that are priced attractively. Encourage locals to support your restaurant by purchasing gift cards at a small discount or perhaps offering a gift or gift card with each purchase.
In addition, do not forget to focus on guest service. Now more than ever, it is incredibly important to make our guests feel safe and welcome at our restaurants. Stress is high and frustrations are being felt, so encourage team members to up the hospitality and to treat each guest like royalty. Guests reward those of us that take the time to make them feel special with their loyalty, so put the emphasis on a safe, warm and heartfelt experience. That loyalty will pay off big time during the hard times and will grow exponentially into the recovery phase.”
Gracias Madre / Café Gratitude SoCal
“It’s been a challenging time for small businesses, such as restaurants and bars, to say the least. We’ve had to reinvent ourselves and adapt to the everchanging climate we are currently living in. As a business owner myself, I do have some insight on what businesses should be doing right now. To start, aggressively cut back all unnecessary expenses and shift your focus on take-out and delivery. If you have outdoor dining, invest some money into making the new outdoor ‘dining room’ as nice as possible. No one wants to feel like they are in a parking lot, even if they are literally in a parking lot. Rework your menu and your packaging to work well for delivery and takeout. Remove items that won't travel well, and if you sell liquor, can or bottle your cocktails and promote as much as possible on social media.
Take one day at a time, and reach out to your loyal customers for support. Community wants to support their local restaurants. Focus on a great digital ordering experience for the guests, whether it's on your website or a third party platform. Make sure your photos and prices are accurate. If your city allows it, sell alcohol on the delivery platforms. Reduce labor as much as possible and ask any salaried management to fill in the gaps. Talk to your landlord and work out a rent you can afford. Preferably a percentage of sales. Continue to innovate with a focus on travel friendly products or items that are shelf stable that you can ship. Digital ordering platforms are key to be able to maintain a customer base that is not coming into your restaurant to dine. We are exploring subscription products, leveraging our loyalty members more, and investing in a beautiful outdoor dining experience. We are shifting permanently to a counter service model to save on labor as more of our sales come from delivery and online orders.
Beyond making sure you have a strong takeout program, focus on staff morale and teamwork. It's hard to work in a restaurant with all the requirements for safety. In our pursuit of survival, it will be key to have a happy workplace where your team is willing to go the extra mile. Stay positive and don't lose your mind trying to plan for the future.”
Founder and CEO
Oktober Can Seamers
“Clearly, considering take-out options is a good idea for the next several months. Even a good portion of next year is questionable for ‘back to normal’ on-premise sales. Meanwhile, relaxed rules allowing the addition of areas allowing open containers and increased outdoor seating has been very popular, and it seems there is interest for some of that to stick around even after we are out of the pandemic. There is a good chance that ‘back to normal’ won't quite be exactly the same as before all of this, so staying agile and keeping an eye on how things come into focus as we get closer to normalcy should be a priority.”
“…over the past 7 or 8 months, I've been talking about this topic quite a bit. My advice to restaurant owners is three-fold:
1) Diversify your revenue streams. In my opinion, the pandemic didn't cause this crisis; it merely brought it to our attention. Restaurants should take the time now to diversify their revenue streams so they have a variety of ways to make money. In-person dining, takeout, catering, retail, education, special events, speaking engagements and pop-ups. Back in March, most restaurants pivoted to a takeout/delivery model... but I challenge business owners to continue to iterate and innovate. Find a way to make that a steady revenue stream long after the vaccine is here. The restaurant may be shut down... perhaps this is the time to start a blog or a podcast sharing tips and recipes? Or host cooking classes via zoom. Or what about a cookbook? Is now the time to collect recipes and start writing a cookbook?
2) Rethink everything about the business. Restaurants – at least as we know them – have only been around for about 250 years. And in that time, they have changed very little. And yet the world around us is changing at the speed of light. Viewed the right way this pandemic is something of a gift. It's forcing all of us to rethink how we go about our business. For an industry that operates with razor thin profit margins, where four to 5 percent profit is seen as success, I think this is the perfect time to chuck it all and start over. Do we need waiters now that we have smartphones and tablets? Are restaurant ticketing systems the future of reservations? Can we harness data to be able to better connect with our patrons and serve them more generously?
3) Focus on serving instead of selling. Of course, that brings us to the third and final point... shift your mindset from selling to serving. Our customers are giving us the two most precious resources they have: time and money. Let's honor that by providing them with exceptional experiences. That is how we will maintain trust throughout the next wave of the pandemic, and it will be key to helping us rebuild our communities after.”
Director of Communications
“Since states keep changing rules for restaurants throughout the country, it's good practice to focus on promoting takeout and online orders. There are easy to use and affordable tech tools – like online form builder JotForm – that make it easy to collect orders and payments online. Restaurants can even generate QR code menus through JotForm to ensure a fully contactless experience for customers.”
MD and Founder
Koop + Kraft
“The only way to survive right now is to find a way to get your products into people's homes. Whether that's takeaway, ready meals, collection drinks, gift sets, cook-at-home sets – there's plenty of options. It's just a case of being ready and agile enough to adapt as these concepts will likely be strong for the next six months minimum. In terms of planning, have loose plans for the future with a contingency plan, and as the time comes closer, tighten those plans into something more concrete. Be prepared for things to change and pivot – change is the only thing that's been guaranteed in 2020. Diversify and tailor your offering and embrace the opportunity to do so. We’ve done very well from investing more time, effort and money into our takeaway offering and have had results with the restaurant both open and closed. Some others may look at other options like a Hello Fresh-style or even something like a Zoom cook-along or taking the opportunity to release a cookbook.”
North Star Leasing
"We're an equipment leasing company providing financing in the restaurant industry. During the pandemic, we've worked closely with a surprising number of establishments that have charted a path of growth. They're not just surviving, they're thriving because they've taken this time to embrace change. They've rebuilt websites for online ordering. They've invested in kitchen equipment that allows them to fill digital orders more efficiently. They've invested in outdoor heaters, tables and tents. They've financed purchases that put them in place to leverage various CARES Act programs that sets them up for the future. Restaurants who are positioned to make nimble course corrections in their business can get through this, and part of that is finding partners who are also willing to embrace change."
“We’re telling our restaurant clients to focus their efforts on curbside/takeout. If the second wave of shutdowns hasn’t hit your market yet, there’s a good chance it will soon. Now is the time to double down on your operations to ensure the pickup experience is seamless for customers. What does that look like from a construction standpoint? Talk to your landlord about how you can work together for this next wave of shutdowns. Can you split the cost of immediate tenant improvement efforts such as adding a patio for additional outdoor seating? If you are in a position to plan for the future, having no indoor diners is an opportunity to invest in your space without the need to do construction work off hours. If not, what minor improvements can you make to your space – perhaps adding a takeout window? Tweaking the area near the front door for a contactless pickup? Adjusting signage? Or, if you have an established brand, should you rethink your brick and mortar space entirely and consider a ghost kitchen for the near future? Talk to your general contractor about the pros and cons – there is a lot to consider.”
“During this time, it's most critical for bars and restaurants to think outside of the box, adapt to the current times and preserve capital. Although we can't be certain what the industry will look like in six months, prioritizing these aspects now will position business owners in a better place to make a quick and steady comeback. Restaurant and bar owners can utilize flexible on-demand staffing platforms like Qwick and budget planning tools like xtraCHEF, as well as listen to guest's and staff's needs, and speak with other business owners to compare and contrast what's working well and what's not as they continue to adapt to new regulations.”
Founder and CEO
SnapShyft Labor Marketplace
“Adapt or die – the war for talent and employee retention has never had higher stakes – a $146 billion problem last year, now compounded by COVID-19. I would highly recommend and encourage anyone involved in talent acquisition or HR to have a sincere open mind towards establishing a new paradigm built around adaptability by becoming an enabler of adaptation, rather than a compliance bottleneck. Becoming active and vocal champions of what it will take to adapt and operate competitively – the majority of business execs are championing the integration of contractor/gig-economy into their respective labor models and F&B/Hospitality is the industry that can benefit most through evolving how they handle labor shortages, recruitment, retention, et al. So, in the short-term we see a continued evolution towards tech-enabled management/optimization of worker staffing/scheduling, powered by the gig-economy (and 'gig-trade') – this is essential in order to compete and stay solvent. And longer-term there will be a growing reliance on technology within every aspect of the operation and companies can be ready to take advantage, but they must start now or be left behind.”
Watch for part two of this series from Bar & Restaurant, where we’ll share more insights from industry thought-leaders.