OKLAHOMA CITY – David Fox is worried.
Like thousands of other Oklahoma businessmen, Fox is worried about how the Covid-19 virus will affect his business.
He should be.
Fox, the chief operator officer of Ted’s Café Escondido, a Mexican food restaurant with 10 locations across the state, has watched as his company has lost 90 percent of its sales. With restaurants across Oklahoma being forced to close their doors to in-person dining, the coronavirus sweeping across the state could, Fox fears, have a lifelong impact on the industry.
“It’s a global crisis,” he said. “The longer this goes on the worse it gets.”
Fox isn’t alone. The state’s 7,000 restaurants have watched their business fall to catastrophic levels. Large and small restaurants have ‘laid off thousands of people,’” said Jim Hopper, president, and CEO of the Oklahoma Restaurant Association. “They are massively struggling.”
Nationwide, restaurants and the foodservice industry are anticipating a direct drop of $225 billion in sales over the next three months and a negative economic impact of $675 billion. That’s on top and an expected loss of between five and seven million jobs.
“As an industry that is based on welcoming everyone through our doors, we are uniquely affected by mandates that keep us from serving our customers,” wrote Sean Kennedy, the Executive Vice President for Public Affairs for the National Restaurant Association. “The restaurant industry is one of low margins, tight cash flow, and a workforce that depends on us for their livelihood. Without aggressive and immediate action from the federal government, many restaurants that are a staple of local communities will simply never resume service.”
For guys like Fox, that means a payroll of 1,400, bills and little income. And while Fox and others are working aggressively to shift to take-out sales. The change might not come quick enough.
"Our catering orders are down 98 percent, some grocery stores are ordering catering for their staffs, so they don't have to leave and find somewhere to eat but other than that catering is all but gone,” he said.
Cathy Cummings, the owner of Vito’s Restaurante in Northwest Oklahoma City, said she, like Fox, is working to shift to delivery and take-out orders but knows that switch will be difficult for her and her customers.
“People are so supportive of all of their restaurants,” she said. “The problem is there are so many of us, it’s overwhelming. People try to support as many as they can, even though they, too, are suffering.”
Technology has helped – some.
Smart phone applications like Doordash, UberEats, and Grubhub allow customers to quickly order and have their food delivered, but those efforts have yet to cover the massive losses on in-person dining that most restaurants are experiencing.
“My team has been doing our best to keep as many of our Oklahoma employees, my Ted's family, working during this time that we can,” Fox said in a posting on Facebook. “The busier we can get with this temporary norm, the more I can get hours to our hard working folks.”
But more help is needed.
Hopper, the industry representative from Oklahoma, said ORA recently launched a marketing campaign – called Keep Calm and Carry Out –designed to encourage people to place take-out orders. On the national level the National Restaurant Association has asked the Trump Administration to authorize the Treasury Department to create a $145 billion Restaurant and Foodservice Industry Recovery Fund.
That fund, the industry said, would give restaurants “immediate liquidity to compensate for reduce revenue attributed to coronavirus-related decline in order to pay employees, maintain service operation (and) meeting transactional and financial obligations.”
The association is also asking Congress for $35 billion in CDBG grants for Disaster Relief, $100 billion in federally back business interruption insurance, assistance in deferring mortgage, lease and loan obligations, $45 billion in expanded access to affordable federal and conventional loans and $130 million in disaster unemployment assistance.
“Taken together, these proposals will ensure that restaurants have increased liquidity and access to necessary financing to help them survive the dramatic loss in profits caused by the coronavirus,” Kennedy wrote in a letter to President Donald Trump, House Speaker Nancy Pelosi, and Senate Majority Leader Mitch McConnell. “We urge you to take critical steps to support America’s restaurant industry and the 15.6 million workers we employ.”
For Fox, the goal is a simple one – stay in business.
“We run net 21-30 days with our vendors, we have landlords, wages and more,” he said.
“The painful answer is there isn't any money. For 28 years we have invested in our staff, we have some that have been with us since the beginning. The longer this goes on the more it drives those people to other jobs."