‘We’ve almost lost hope.’ Miami restaurants won’t survive on takeout and delivery
On the morning his Miami restaurant was closed for exactly one month, Cristian Alvarez took stock of his dire situation.
He’s had to slash labor at his Little Haiti Argentine restaurant, Fiorito, from 25 employees to five, including him and his brother, who co-own it.
He’s behind $10,000 on his rent and is working with his landlord to delay or reduce that. Offering only takeout and delivery, Fiorito is selling about 10-15 percent of its previous sales.
“There’s no way to survive this way,” he said.
Restaurant owners around the country sense the same despair.
Only one in five restaurant owners think their businesses will survive the COVID-19 crisis, according to a new survey of 1,400 independent restaurants conducted by the James Beard Foundation. The organization, which supports restaurants and honors chefs annually with awards considered the Oscars of the food world, conducted the survey from April 9-13, its second since March, and released its results Thursday.
Nearly six in 10 believed they could survive between one week and one month in the country’s current state, those surveyed said. Almost half said they could make it through another month with an infusion of between $10,000-$25,000, and most, nearly 68 percent, said they would need less than $50,000.
It was one month ago, March 16, that Miami-Dade ordered restaurant dining rooms closed to stem the spread of the coronavirus. Some restaurants shuttered altogether. Many others, like Fiorito, have fought to keep some money coming in, even if it is only a trickle of their previous earnings, by offering delivery and takeout.
And those delivery orders are subject to 20-30 percent fees if they are ordered through one of the popular delivery apps.
Alvarez said he’s been able to offer former employees piecemeal shifts. His dining room usually seated 200-300 people on a weekend. Now he sees 20-30 people coming to his walk-up window.
“This isn’t living. This is just surviving,” he said.
That takeout/delivery model won’t sustain them, restaurant owners say.
“I don’t think it’s going to keep restaurants afloat,” said Naomi Pomeroy, a Seattle James Beard Award-winning chef who helped start the Independent Restaurant Coalition, hoping to speak for the more than 500,000 restaurants and 11 million restaurant workers in America.
The government’s emergency payment protection program, which allocated $350 billion in loans, was supposed to supply forgivable, low-interest, short-term loans to small businesses. But the fund ran out of money by Thursday when owners like Alvarez, who had applied, were left waiting for help. He still had not heard back from his bank when he read the news Thursday morning.
“We’ve almost lost hope,” he said.
Meanwhile, several big-name, national restaurant chains have received millions from the federal program. Ruth’s Chris steakhouse alone received $20 million in aid, according to the Wall Street Journal.
That program was flawed from the beginning for restaurant owners, the Independent Restaurant Coalition’s representatives said during a conference call when the James Beard survey results were announced. The organization said the loans should be pegged to the day restaurants are legally allowed to fully reopen, not while they are relying on limited takeout and delivery. They also argue the program shouldn’t require them to rehire their full staffs by June 30 — since no one is sure if restaurants will be fully reopened by then, chef/owner Tom Colicchio, the Bravo “Top Chef,” said during a conference call.
In an April 6 letter to Congress signed by more than 25,000 chefs and restaurant owners, they asked for the payment protection aid to start when restaurants are given the all-clear. They will need the help after restaurants reopen, when diners will still be wary of returning to dining rooms.
“The question isn’t when we reopen. It’s when will people feel comfortable coming to a crowded restaurant again,” he said. “We need that long-term protection.”
Right now, the biggest worries for restaurant owners are paying rent and buying ingredients to make their meals, according to the James Beard survey. More than half have taken on $50,000 or more in debt just to remain afloat.
Alvarez says he doesn’t know how much longer his eight-year-old restaurant can operate as a shadow of itself.
“I don’t see a way forward doing only takeout and delivery,” he said.
This story was originally published April 16, 2020 at 5:25 PM.
