Senate Passes Fixes to Paycheck Protection Plan
Designed to keep small business afloat during coronavirus. The Senate Wednesday passed legislation giving thousands of restaurants, nail salons and other small businesses greater access to the Paycheck Protection Program, the federal lifeline designed to help them stay afloat during the coronavirus pandemic. The new changes would:
- Lower to 60% from 75% the minimum portion of the PPP loan must be spent on payroll. The rest must be spent on rent, utilities and other business-related expenses.
- Extend from eight to 24 weeks the amount of time the loan can cover.
- Extend from two to five years the time new PPP loans must be paid back if the amount provided doesn’t convert into a grant.
The bill, which overwhelmingly passed in the House last week and is now headed to President Donald Trump’s desk, loosens some key rules regarding loan repayment and spending restrictions of the PPP.
When N.J. Reopens Outdoor Dining
Here are the rules restaurants and bars must follow. When New Jersey begins allowing outdoor dining June 15, restaurants and bars that take part must place tables six feet from each other, limit eight customers to a table, post signs that say patrons with a fever or symptoms of the coronavirus shouldn’t enter, and prohibit smoking in areas where people are drinking and eating. The state will also allow any establishment with a liquor license to apply for a one-time, special permit to serve alcohol outside. And local authorities will decide whether eateries and bars that don’t already have outdoor space can get “creative” and use parking lots, sidewalks, streets, and other areas for seating.
For Restaurants, Outdoor Dining Merely A Stopgap
Outdoor dining as only solving part of the problem. As cities begin to open back up in the U.S., social distancing requirements remain in effect in hopes of preventing a rebound of COVID-19 infections. Some cities are dedicating full streets and sidewalks to enable extended outdoor restaurant seating, but more crowded metropolitan areas may run into trouble finding space for diners. One architect recently created an outdoor dining template for restaurants to make use of the limited street and sidewalk space in New York City. “Providing outdoor dining now is an excellent first step for businesses who are doing their best to survive and is undoubtedly a bump up from take-out only, which is what restaurants have been limited to, but we need to get back to indoor dining as soon as possible,” wrote Art Suriano, CEO of the TSi Corporation.
What Restaurants Will Survive Coronavirus?
Restaurant patrons will be looking at a future with fewer dining options and less variety. Running a restaurant is expensive and risky, even in a strong economy. The typical profit and loss statement shows food and labor swallowing up 60 to 65 percent of total revenue and occupancy costs (i.e. rent) another eight to 10 percent more. A few other smaller costs figure in, as well as a profit margin ranging from five to eight percent. To reach the break-even point — the point at which those profits start to be realized — the restaurant must fill 80 to 85 percent of its available seats. Some sit-down restaurants can survive with these limitations and increased costs for a short time. Most cannot for an extended period. Forced to jury-rig their business model, many owners will find the effort not worth it anymore.
A New Era of Dining in the Age of Coronavirus
Emerges at the Bellagio. MGM Resorts gets ready to debut three of its casinos and dozens of restaurants on Thursday with new health and safety measures in place to prevent customers and employees from spreading COVID-19. Staff started returning to work on Monday for training that began with overall health and safety measures at the resort, followed by specific restaurant protocols and tasks for their jobs. “I will say that our employees, when they came back in, they totally understand, welcome the change, and all of them were actually pleased to see all the steps that we have taken,” says Dominique Bertolone, the senior vice president of food and beverage strategy at MGM Resorts International.
Did You Know?
“Restaurant Rap” continues with exclusive restaurant industry interviews. Today’s “Restaurant Rap” features an interview with community activist, restaurateur, owner and operator of Woody’s Restaurants in Sea Bright and Tinton Falls, New Jersey; Chris Wood. Cited as one of the top 100 leaders in New Jersey business, Chris Wood, began his career in the restaurant business as a busboy over 40 years ago. Tune in as he describes the challenges he has faced during the pandemic and the changes he foresees for the industry going forward. This series appears each Thursday within the company’s Restaurant Industry Alert daily bulletins. It presents recorded virtual video interviews with local restaurateurs and other industry professionals, many of whom are the firm’s clients, customers, and associates.
Click here to watch interview
All previously reordered interviews can also be found at our website www.njrestaurantsforsale.com/news and on http://vimeo.com/bielatsantore.
Employee Tip
Employee TipNYC’s Laid-Off Fine Dining Chefs find glimmers of hope with new home businesses. Chefs formerly at Michelin-starred restaurants like Eleven Madison Park or hot spots such as Mission Chinese Food have started selling food to neighbors — and considering launching more sustainable, long-term operations. With positive feedback from family and friends, a husband and wife team started their own home business. It might sound like grueling work for home cooks, but the duo has plenty of experience: Nicolon was recently laid off from her job as a pastry chef at acclaimed fine dining destination Eleven Madison Park, while Pavlik was previously sous chef at Tom Colicchio’s FiDi restaurant Temple Court. They’re currently booked on bagel sales for two weeks.
Bielat Santore & Company – Restaurant Industry Daily Alerts
NJ Restaurant Reopening Playbook to be released, Monday, June 8th. Bielat Santore & Company has formed a “task force” comprised of multi-unit restaurant operators to collaborate on ideas, procedures, strategies and goals as they relate to the preparation for and the reopening of restaurants and other hospitality-based businesses in New Jersey. The Mission of this “task force” is to provide a collaboration of knowledge, expertise and innovative thinking from some of the industry’s most reputable restaurant operators, that will yield a strategy for all independent restauranteurs to follow, assisting all in the transition back to “business as normal.” The firm will release a “Restaurant Reopening Playbook,” a guide for preparation and execution this coming Monday.
Request a copy by emailing…i[email protected]
A voice for our industry. If you are finding these daily bulletins informative and beneficial during this pandemic, we kindly ask that you write a brief Google review providing a vote of your appreciation. Simply Google “Bielat Santore & Company” and when the company name appears click the button on the right to write your review or; if you don’t use Gmail, go to Google Maps, type “Bielat Santore & Company” – Allenhurst, NJ into Google Maps; scroll down and you will see an option to leave a review.
Thank you and remember all of the “Restaurant Industry Alerts” and “Thursday Restaurant Rap” interviews can be found at www.njrestaurantsforsale.com/news/. We intend to continue to keep you informed as we all look for an end to this crisis.
How to market your restaurant for sale during the coronavirus pandemic. Of course, it will be challenging to market and sell businesses that have temporarily been shuttered during the pandemic, because valuations are based on historical financial data. However, whether you choose to reopen your business or not, owners can still position them for sale. So, what should you do if you want to sell in the next 6 – 12 months? Contact a good business broker that specializes in the sale of hospitality real estate and businesses. Bielat Santore & Company, Allenhurst, NJ has been brokering such sales for over 40 years and will be able to help you come up with flexible deal structures and capital sources to make a sale possible; call for a free consultation – 732.531.4200.
