Big and Small Restaurants Battle for Relief Funds
As a result of coronavirus shutdowns, the restaurant industry suffered an estimated $30 billion in losses in March and is expected to lose $50 billion by the end of April. Independent restaurateurs trying to stay afloat amidst the economic turmoil were outraged by Congress’s stimulus package released in March.
The first wave of the Paycheck Protection Program, totaling $250 billion in low-interest government loans, allowed big chains such as Shake Shack, Potbelly and Ruth’s Chris Steak House to receive tens of millions of dollars. Many smaller restaurants received nothing. The National Restaurant Association sent a letter to Congress on March 18th, requesting a recovery fund specifically for the independent restaurant industry.
“We need to get the money into the hands of independent restaurant owners,” said Andrew Rigie, executive director of the New York City Hospitality Alliance. But a restaurant-based relief plan has always been highly unlikely. While many large chains have the resources to last in a longer-term shutdown, most independent restaurants, which make up two thirds of the dining environment in the U.S., will keep struggling to survive. After strong criticism from independents, the Shake Shack chain returned its $10 million government loan, gaining capital elsewhere from an unrelated equity transaction.
How Young Americans Plan to Spend Money Post-Lockdown
Young Americans want to go out to eat again. TruePublic, a Chicago-based research and opinion firm, asked Americans ages 16 to 35 about when they would resume their favorite activities post-lockdown and what those activities would be. Dining out was first, as the survey revealed 55% plan to eat at restaurants “as soon as isolation ends.” However, 16% will wait a few months after lockdowns are lifted before eating out again, and 16% say they won’t be going back until “long after a vaccine is out.” A smaller contingent, 13%, say they will wait only until a vaccine is developed and deployed. As for other activities, the majority of those polled said they would wait several months or even until there is a vaccine before returning to movie theaters, sporting events, concerts and other gatherings.
Restaurant Leaders Named To White House “Economic Revival” Panel
Nearly two dozen restaurant industry executives were chosen to advise the White House on reopening the economy. The leadership panel includes representatives from big chain restaurants, such as McDonald’s CEO Chris Kempsczinski, as well as independent restaurants, such as Thomas Keller of Thomas Keller Restaurants. Marvin Irby, interim CEO of the National Restaurant Association, was also named to the group. The restaurant industry panel is one of 17 different advisory groups representing various facets of the economy from agriculture and business to sports and travel, known as the Great American Economic Revival Industry Groups. Via conference call, these groups will collaborate with White House representatives on reopening the economy in a coordinated “rolling recovery.” Restaurants have been particularly hard-hit by the coronavirus pandemic, laying off millions of workers, and its leaders are are eager to find solutions for the recovery and long-term health of the industry. .
