The St. Louis food scene needs the Restaurants Act
Editor's note: This article is an opinion piece from Tara Gallina, co-owner at Vicia and Winslow's Table.
As the owner and operator of two restaurants in St. Louis, I have experienced firsthand the reality of running a restaurant during this crazy time. In March, everything came to a screeching halt. We had to shut down in order to keep our team safe and, sadly, lay them off at the same time in order to get them the financial support they needed through unemployment. We had outstanding bills to pay and rent to make, along with so many overhead liabilities. Liability and health insurance, utilities, building maintenance – though we were closed, these costs didn’t go away. Two months of zero sales came and went.
We all hoped that when our city reopened, that meant we could too. But the reality is that we are very far away from being able to fully reopen safely. At Vicia and Winslow’s Table, we had to weigh the choice of opening the inside dining rooms or not. We didn't feel OK with exposing our staff to the potential risks associated with people dining indoors. At Winslow's, we pivoted to an online grocery store along with creating a walk-up window for to-go food and pastries. At Vicia, we built a website for to-go food and a retail wine shop with bottled cocktails. We developed a hybrid dine-in concept for our patio and worked with Cortex to expand onto the front lawn of the restaurant. In late June, we were about to pull the trigger on slowly opening our indoor spaces; then overnight, it felt like the worst possible decision. So for now, we are doing what we feel comfortable asking our team to do. It's not ideal – we're using way too many disposable goods, we're turning down private event inquiries all the time – but it’s what we feel is right.
In many ways, this constant reinvention is something we are used to. People in the restaurant industry tend to be creative, entrepreneurial and scrappy. We’re not afraid of hard work. But the situation we are being faced with is not of our own making. Even the most successful restaurants operate on thin margins. At Vicia and Winslow’s Table, we typically operate with a labor cost around 35% of sales, which is the largest share of our expenses. That is fairly common for many restaurants. 25% goes toward food cost, 7% toward rent, taxes and insurance, 20% toward operating expenses. This means, if we're lucky, there’s 13% left at the end to build a cash reserve for slow months. When we're facing 50% to 65% revenue losses each month, keeping up with these costs can be insurmountable.
These industry norms mean that most restaurants don’t have a “plan B” to keep them afloat through this kind of protracted crisis. My colleagues are taking on debt just to make rent. Some are taking out Economic Injury Disaster loans through the U.S. Small Business Association; some are maxing out credit cards. Some who can, have taken out bank loans; others are negotiating debt payments to investors that could come at a higher penalty or interest rate. Even financially risky lifelines like these are dependent on a certain amount of economic privilege; not all restaurant owners have access to credit or investors. For these businesses, the current options are stark: remain open in order to pay the bills, with all the health risks involved; or close permanently. So what's next?
We need Congress to pass the Restaurants Act.
The bipartisan, bicameral Restaurants Act of 2020 is the first restaurant-specific relief introduced in both chambers of Congress. This legislation would establish the $120 billion Independent Restaurant Revitalization Fund, which would allow small businesses to apply for grants tied to their revenue losses. The funds provided would allow us to make payroll, pay our rent and utilities, purchase PPE for our staff, and make the infrastructure improvements necessary to make our businesses safe. Rather than a one-size-fits-all approach to funding, businesses will receive help suited to their needs. This is good for those that may have taken a hit harder than others and helps ensure that taxpayer funds aren’t going to businesses that don't need it.
At this time, the Restaurants Act is not yet up for vote. This is what the push is for right now: We need it to be brought to the Senate floor. But to do that, we need more senators on board. Missouri’s restaurant owners want to know what Senators Blunt and Hawley plan to do to support our small businesses. Owners and the general public need to demand that our elected officials step up to the challenge and advocate for financial relief for the restaurant industry.
Though the solution is legislative, this problem isn’t political. It’s a fact that restaurants are being disproportionately affected by this crisis. Call your representatives, write them, and tell everyone you know to do the same. When the winter comes and we all have to close up our patio dining, some very hard decisions are going to be made. Please help us not have to look at our team and tell them another layoff is coming.
As a hospitality professional, I want nothing more than to welcome people back into my restaurants. But until that is a safe thing to do, I will work hard to advocate for this industry and the thousands of people who make it so special. These days, safety is the new hospitality.
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