North Bay restaurants in great peril as they try to survive coronavirus pandemic
There is perhaps no industry that has been hurt as badly from the economic fallout of the coronavirus pandemic than the restaurant sector.
Even before shelter in place and social distancing became commonplace last month, being a restaurateur in Sonoma County was not easy. Rising rents and two wildfires since 2017 on top of the struggle to retain workers in an area with a steep cost of living left many area restaurant operators with slim profits.
The pandemic brought with it an existential problem of trying to stay afloat on takeout and drive-thru receipts, after dining rooms were closed in mid-March. When local and state public health officials will allow in-person restaurant dining again remains undetermined.
The big question though is how many purveyors — from food trucks to Wine Country fine-dining establishments — will be knocked out by COVID-19?
The California Restaurant Association estimated as many as 30% of the state’s more than 90,000 restaurants could close unless more government financial help and regulatory relief are provided. Already, there’s been at least one high-profile local casualty: downtown Santa Rosa’s Bistro 29 closed its doors last month after owner Brian Anderson conceded that “we’re just not making it.”
Some restaurants have secured short-term payroll loans through the U.S. Small Business Administration’s Paycheck Protection Program. But the loans are only forgivable if they rehire the scores of workers they’ve furloughed. Problem is there’s not enough revenue from food carryout sales to warrant bringing back many furloughed employees. Many of the restaurant workers can earn as much or more money on the increased unemployment benefits, so they are reluctant to go back to cooking or waiting tables.
“In my opinion, it’s not really for restaurants,” Chris Frederick, managing partner of Third Street Aleworks in Santa Rosa, said of the SBA financial relief. “We decided against it.”
Frederick and his two partners just bought the longtime downtown brewery and restaurant last year to revitalize it and didn’t want to throw in the towel. Once the county’s original stay-home public health emergency order went into effect March 18 which essentially closed most businesses, they furloughed about 60 employees and closed for a week. The owners got together to plot a business strategy for the age of the coronavirus.
“We sat down at the table and asked, ‘What can we do to keep money coming in and to keep us afloat? What can we do to get staff to come back in?’” Frederick said.
They heard from customers before the shutdown about the difficulty getting certain foods with the panic buying at grocers, and the fears of grocery shopping and possibly contracting the virus. They also heard from their food vendors who worried about their own viability with restaurants closing. For the Third Street Aleworks partners, the temporary game plan became putting together and selling online grocery boxes. For a $20 box, there’s vegetables, fruit and other items from Andy’s Produce Market. A $35 box contains milk and other dairy products from Clover Sonoma. Customers also can buy toilet paper and spray sanitizer as part of the pick-up food service.
The results have been gratifying with about 3,700 boxes sold in about a month, Frederick said. The grocery box sales have complemented beer and other prepared food sold to go. It’s generated enough revenue to bring back three employees.