A look inside the restaurant industry during the pandemic: Part 1

Written on Sep 10, 2020

By Jessica Salerno, OSCPA senior content manager 

While no industry has gone untouched by the pandemic, restaurants are among the sectors that have been hit hardest. That so many are finding ways to stay in operation speaks to the resourcefulness and skills of the industry’s people, said Dustin Minton, CPA, director, restaurant services at GBQ. 

Man in suit smiling for camera.

“The restaurant industry is made up of some very creative, innovative people,” Minton said. “You can put them in a corner, but they'll figure a way to get out.” 

Vince Stasiulewicz, CPA, client executive at Hylant, agreed. He said how a restaurant is faring during the pandemic could depend on a wide variety of factors, such as whether they are quick-service or tailored to in-person dining. Stasiulewicz and Minton touched on some key issues in discussing the ways the industry is coping: 

Adapting to change 

Sit-down restaurants have been forced to “turn their model upside down,” Minton said. Many have transitioned to offering more delivery and to-go options, and some now offer to-go meal kits, which are various ingredients of a meal boxed up that diners can prepare when they get home. 

Fast food locations have been pushing their drive-thru menus, with many closing their dining rooms entirely. For those restaurants that have opened inside, they have had to adjust in virtually every area of the way they serve the customer and even prepare the food. 

“Restaurants are very cognizant of department of health standards, and so they were always very clean to begin with,” Minton said. “But now you see some put up Plexiglass, the servers wear gloves and masks, and they’ve figured out the way to put the dividers up in between tables so they can have social distancing.” 

Stasiulewicz said they’ve also been forced to reconsider how those in the kitchens work together, as many previously worked in close quarters that didn’t allow for social distancing. This has impacted how many staff can be in the restaurant while still being safe. 

Man in suit smiling for camera.

Local and federal restrictions 

Public officials made decisions early and continuously throughout the pandemic to either restrict capacity, limit hours of operations or in some case cases, shut down operations all together for restaurants and bars, Stasiulewicz said. 

He noted the shifting rules bars especially have had to be aware of in terms of how long they’re able to serve alcohol and even the transition to offering to-go cups of alcohol. 

“Because literally overnight, the industry changed and in some cases for the worse,” he said. 

Successful strategies 

One of the strategies that has worked for many restaurants was transitioning to the carryout and delivery business as quickly as possible, Minton said. Working with third-party delivery services also helped, although that doesn’t come without its own frustrations. 

“A full-service restaurant that wasn't accustomed to delivery could easily plug into those third-party delivery providers and let people know on the app you are open for business,” Minton said. “There's a love/hate relationship with the third-party delivery providers in terms of the fees that they charge, but by and large, most people do see it as a benefit.” 

Restaurants are trying to maximize seating capacity the best they can and are thinking of new creative ways to make use of outdoor and patio seating before it gets too cold. 

“Because many people still do not feel comfortable sitting inside a restaurant, but they'll sit on the patio,” Stasiulewicz said. 

Other restaurants decided to close and wait until they heard if they would receive any aid from the Paycheck Protection Program, so they would be able to bring back and pay their employees. Extensions made from eight to 24 weeks helped, although many looked at it as a gamble. 

“That was a strategy that a lot of them used, and I've heard from numerous restaurant companies that it really was the lifeline that kept them alive,” Minton said. 

Read part 2 next week covering cash flow, communication with restaurant clients and more. 

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