We all know the saying that goes “Don’t mess with success”. Unfortunately, when the rules of operation change due to government regulations and customers adapting to a new environment practically overnight, so must businesses reformulate their methodology. In other words, even if you have been making money for years or even decades doing what you’re doing, it may not be good enough to keep doing the same to survive in this “new” day and age.
When state mandates were announced in March and April determining which businesses could stay open and which ones had to close, restaurants were considered essential and were given a priority, first allowing them to operate as take-out and delivery businesses, then 25% inside dining followed by what we are used to seeing – 50% capacity. Unfortunately, some decided that they couldn’t handle the restrictions so they shut down immediately while others gave it a try while bleeding money daily to the point where they could close any day.
Let’s take a look at why the old way of doing business did not help these businesses, no matter how many years they may have survived till now.
Capacity limited to 50%
With every second table left empty or moved further apart to increase the distance between customers, restaurants revenue could not keep up with the cost of rent, paying staff and other operating expenses, not to mention a shortage in certain ingredients which lead to higher costs too. This is where creativity comes into play, whether it be moving tables outdoors setting up on a sidewalk, under an awning, converting street parking to outdoor dining, perhaps setting up a tent in a parking lot or even cleaning up a back-alley. You know those Christmas lights and tiki torches should come in pretty handy when the sun goes down and customers will love the new atmosphere (as long as the back alley dumpster is far enough away).
Customers afraid of indoor dining
With all the hype around the dangers of viruses floating around enclosed spaces, carried by the winds of air conditioners, it’s no wonder that even the most loyal of customers will not revisit even the cleanest restaurants until the pandemic is under control. This is exactly why restaurants that made 90% of their money from indoor dining and only 10% from take-out and delivery need to figure out how to shift efforts to supporting the “to go” orders. For example, does the website have an online order option? Is the restaurant listed with delivery services such as Door Dash, Delivery Dudes, Uber Etc, etc…? And what does the restaurant do to make this as efficient as possible – such as adding a designated parking spot where servers will run out to either take customer orders or deliver pre-paid orders to customer’s vehicles.
Social Media Marketing
Too many restaurants that have survived recessions, financial crises and even hurricanes can’t seem to communicate with their customers because they don’t take the time or hire the right people to handle online communications. It could be as simple as sending out a weekly email, posting daily specials on Facebook and Instagram or even updating their business hours on Google Maps. (By the way, we should forget about updating Apple Maps, Yelp, Tripadvisor and BING too).
What about live music?
The biggest issue restaurant owners and managers have with live music is how to cover the cost when only half as many people are able to attend. It’s no surprise that very few full bands are playing right now. Most have been replaced by two-man bands doing acoustic versions of the shows they used to play with 4 or 5 men on stage.
Unfortunately, people don’t really drive out of their way or more than a couple of miles to see a 2-man show. And that’s where a decision needs to be made whether or not to start charging a cover fee at the door, selling tickets online, food and beverage minimums, to increase revenue or reduce cost of entertainment, lay off staff, reduce rent, to decrease expenses.
Earlier this week, The Funky Biscuit, a Boca-Raton based restaurant-bar with a jazz-club atmosphere announced that this would be their final week in business after 10 years of hosting Blues jams, Touring bands and many well known local musicians. It appears that they were having a hard time staying afloat since the pandemic hit. Not only were they forced to redesign the layout of their already small club to accommodate far less people, but they continued charging for tickets while hosting smaller bands and many local ones that played without any cover charges at other venues nearby.
The story doesn’t end there. When news of their possible demise reached live music fans via social media, it caused such a commotion that the uproar reached the desk of their landlord who promised to work out some kind of rental agreement so that the “Biscuit” could possibly stay open. But as everyone knows, paying the rent is only one side of the business equation. There’s still the big question as to whether or not the Funky Biscuit and other live music venues can reformulate their formula for success. Only time will tell and I look forward to telling you the rest of the story in the months ahead.