How restaurants cope: react quickly, sell inventory, take care of your own, mind your brand
EVERYONE has taken a hit during this lockdown. Even the restaurants we once went to to taste something new and to escape from the dreariness of normality have taken some bad blows. In a webinar earlier this month hosted by Bounceback PH, RJ Ledesma of Mercato Centrale interviewed restaurateurs about how they were coping during the pandemic, and how they plan to serve food in the future.
Audrey Tanco-Uy, Bizu’s Managing Director, was proactive in her approach. She sensed disaster when the catering arm of the bistro and patisserie chain started getting cancellations from clients. “One week before the lockdown, it was already getting scary for us, mainly because we are also in the event industry. Our clients were backing out on contracts.” As the malls where her restaurants were located began to lock down, Ms. Tanco-Uy knew that her inventory would eventually spoil, so she liquidated them by selling the raw materials to her employees, who needed food anyway.
“What really provides anxiety for all of us are the coming (months). I was doing a forecast, and even in June, it might even be worse for us, when there’s less foot traffic. At the same time, we’ll have to pay for our fixed costs (like rent). It can get even worse from there. Everybody is uncertain right now,” she said.
Meanwhile, Eric Dee, COO of Foodee Global Concepts (which brought Michelin-starred brands FOO’D, Tsuta, Hawker Chan, and Tim Ho Wan to the country, among others), had the same instinct. “We had to decide very quickly. I think we were one of the few that shut down our doors prior to the announcement of the lockdown.” With 4,000 employees, they made sure that they would receive their paychecks and other packages. “We helped our internal staff first. I think that’s more important, that we help internally first before helping outwards.”
Raymund Magdaluyo, President of the Red Crab group, and Wolfgang’s Steakhouse partner said, meanwhile, “What they teach us during times like these: what you want to do is convert as much of your current assets to cash.” He did this by selling 20% of their steaks to cover allowances and assistance to their staff. “I’m prioritizing the core employees, and the most vulnerable.” He’s already seen what the future may hold for some of his branches: “To be honest with you, I don’t think after this crisis all the stores will be opening. I’ve identified a few stores that maybe I won’t reopen.”
As some will note, many restaurateurs have resumed operations by doing delivery and takeout business. Ms. Tanco-Uy jumped into action early. She and her team took a two-day break after the announcement of the lockdown — and then opened up their commissary with 10% of the workforce. They started with bread, seeing as this was an immediate necessity — or, as we say these days, an essential. “It gave us good publicity as well. Not many people were willing to go out of their way to produce food for people who needed it.” Eventually, they went back to producing the pastries they’re known for: a two-pronged approach to keeping relevant. “Bizu is known for celebrations, for bringing joy to homes,” she said. As Easter weekend rolled in, she found her chance. “We marketed it like we were normal, that we are not a business operating during the crisis. We tried to communicate that it’s Easter. There is joy, there is hope. That there’s still love.
“That’s something I would like to share as a key takeaway: instill market to your people,” she said. “I just want to reiterate that you still have to stick to your brand. Don’t act like a company in crisis mode. Continue communicating; telling people about who you are. They have to still have an imprint on who you are.”
On a practical note, Ms. Tanco-Uy sends out her deliveries independent of third-party apps. “They would get 20% of my sales, and at the same time [the service is not that regular]. They won’t be able to build it up.” Seeing that a lot of riders were now jobless, Ms. Tanco-Uy set up her own delivery fleet, citing the advantages of consistency. She also noticed that for deliveries, people still like to make calls, and the only matter is digitizing and capturing their orders and payments.
Meanwhile, Mr. Dee said that a lot of restaurants have begun to operate on limited basis, but says, “I think some have done it prematurely.”
“The new protocols that have to be put in place just to operate are very different to what we’ve been used to,” he said. As a precaution for example, the company purchased 5,000 quick-testing COVID-19 kits for their employees. For now and the future, he said, “Now is the time to be more vocal about your safety protocols. Not only for your staff, but also for your consumers.” For him, the questions asked now are not if the food is good, but if the food is safe.
While the obvious answer for everyone might be converting their operations to delivery and takeout only in the near-future, Mr. Magdaluyo points out, “It’s not overnight that you get to shift mindsets towards deliveries.”
He does say though that some things will definitely change: the desirability of certain locations, for example. “I now look for places with big outdoor spaces… malls probably have to change the way they design.”
Recalling 9/11 in New York, he said that people believed that nobody would step into restaurants anymore. “Ako talaga, naniniwala ako na kakain pa rin ang tao sa restaurant (I really believed that people will still eat in restaurants).
“Ang scenario na puro takeout lang? Bullshit ‘yan. (As for the scenario that it will only be take out? That’s bullshit).
“Dine-in will not die… it might take time, but people will still get coffee,” he said. Restaurants around the world have survived how many pandemics.” — Joseph L. Garcia