Even when restaurants can reopen, dining out won’t be the same

Last week, North Carolina Governor Roy Cooper extended the state’s stay at home order to May 8 and laid out a three-phase plan for reopening over many weeks, well into the summer. Phase two, beginning sometime in late May, would allow restaurants to open for dine-in customers with strict guidelines for social distancing in place.

What will that look like for Charlotte’s restaurants? Cooper and Mecklenburg County officials haven’t shared details yet about exactly when or how bars and restaurants will reopen. Recently, the county assembled a group of business leaders tasked with figuring out how businesses handle reopening, from spacing out customers to requiring face masks.

If we look at Georgia, we could get an idea of what it’ll look like when restaurants reopen.

No other state has loosened stay at home restrictions quite as much as Georgia.

Starting April 27, restaurants are allowed to reopen, according to Governor Brian Kemp’s latest executive order. This decision, which President Donald Trump and public health experts have criticized, comes with a long list of guidelines for restaurants to follow, including limiting capacity to 10 people per 500 square feet and using a reservation-only system.

As important as these restrictions are, they make it hard for businesses to turn a profit, according to the Georgia Restaurant Association. In response, a majority of restaurants will stay closed for now, sticking with takeout to reduce the risk of COVID-19 spreading.

Charlotte restaurateurs are watching the Atlanta restaurant scene closely. Some say late May feels too soon. Some say it’s too far away.

But the handful of restaurant owners I spoke with all agree on one thing: The industry won’t be the same after this.

“It’s going to be very different,” says restaurateur Rob Duckworth. “It’s going to be really strange in a business where hospitality is king.”

The key requirement for restaurants reopening is reducing capacity to ensure social distancing can still be practiced, Cooper says.

While important to prevent spread of COVID-19, reducing capacity will hurt restaurants’ slim margins after an already painful spring.

“Each seat is revenue,” Bruce Moffett says. Restaurants are designed to fit as many people as possible. “Once you start cutting that out, it doesn’t really make sense financially.”

One of Charlotte’s landmark restaurateurs, Moffett owns five establishments in Charlotte and has trimmed his staff of 85 down to 20 in response to coronavirus.

Upon opening his restaurants to dine-in customers, Moffett says he may add a window where you pick up food and then find a spot in the dining room or patio at one of the tables that’s been spaced out. He’s also considered adding a tent outside of restaurants for extra outdoor dining space.

It’s likely all employees will wear masks and only allow guests with reservations to control crowds. This in addition to strict cleaning practices.

At 1,500 square feet, Barrington’s is Moffett’s first restaurant and would also be the most challenging to reopen under reduced capacity. If he had to cut capacity in half, for example, Barrington’s could only fit about 20 people.

At that rate, he says, it may make better financial sense to continue with takeout only for now.

Emotions are also in play, though. Moffett is itching to see his restaurant full of friendly faces again. Even if running under capacity isn’t as profitable, it’s a lot less lonesome.

“Takeout can get a little sad at times because you see all of the chairs stacked up on your tables,” Moffett says. “You’re used to the people and the energy, and then you walk in and there’s no people and no energy.”

Duckworth says with the necessary restrictions, he’d feel comfortable opening his six restaurants and bars in the city now. Those include five Duckworth’s Grill & Taphouse locations, plus Link & Pin.

“If we’re going to be responsible enough to open the end of May, I would think that we could even do that now,” he says. “But I understand the governor’s position.”

Due to plummeting revenue, Duckworth has trimmed his staff of 420 to “well under 100,” he says. Even if it means his six locations are running at half-capacity, he wants to get those people back to work.

Duckworth applied for the Payroll Protection Program for all six locations, but only two have received funds so far. Many other local restaurateurs haven’t yet received a dime from the federal government’s forgivable loan program.

The federal Payroll Protection Program, or just “PPP,” is a small business loan that is forgiven for owners if they keep employees on the payroll for at least eight weeks. The loan program — part of the Coronavirus Aid, Relief and Economic Security (CARES) Act — ran out of funding soon after allocation. But the U.S. legislature recently passed a new bill adding $320 billion to the pot.

While I was on the phone with Moffett, he got a call from his banker and swiftly answered, calling me back a few minutes later. Moffett didn’t receive anything from the first round of PPP, but he’s hoping round two works in his favor. It’s high stakes, and if the banker calls, you answer.

Jeff Tonidandel, who owns Haberdish and Crepe Celler with his wife Jamie Brown, says the restaurant group also hasn’t received any PPP funding yet.

Even if they do receive the loan in round two, the money isn’t a cure-all.

“There’s a lot of great things,” about PPP, Tonidandel says, but “there’s still a lot of risks and uncertainties.”

While PPP may work well for other businesses, it’s a little trickier for restaurants, which may not need full staffs for the coming weeks and months.

Tonidandel says it’s ultimately worth the risks, and he’s hopeful round two of PPP will go in his favor. Still, it doesn’t solve the overarching problem.

“It’s not like we have a vaccine,” he says.

[Related Agenda guide: How to get money if your Charlotte small business has been financially hurt by COVID-19]

Until there’s a vaccine, restaurants will be dealing with uncertainty — perhaps for a year or longer.

Moffett calls the reopening a “mind puzzle,” trying to figure how to best space tables out to maximum capacity and minimize risk.

“As independent restaurateurs, we’re not afraid of a challenge,” he says with a laugh.

It’s true. Even the act of opening a restaurant comes with tremendous hurdles.

Restaurants already operate on razor thin margins, which makes a revenue drop like this one hard to manage. Moffett bets that most will mostly reopen, but in about four to six months, there will be “a little bit of carnage.”

Some will close, he says, but many will hang on.

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