Derek Thompson: America’s restaurants will need a miracle
Britain’s restaurant industry remains in enforced dormancy. Apart from those operating as solely to-go establishments, most have seen their staffs furloughed, their storefronts boarded up, and their chances of reopening postponed until July at the earliest.
For many British restaurateurs—like others around the world—the uncertainty isn’t simply about when their businesses will return, but what their industry will look like when it does. Some fear that the types of social-distancing measures seen in Hong Kong could prove devastating—especially in major city centers, where rents are notoriously high. “Most London restaurants are necessarily fairly squashed dining environments,” Ed Brunet, a co-founder of the Le Bab restaurant group, told us. Of Le Bab’s four locations in the British capital, Brunet said only one would be able to accommodate distancing requirements. The others would see their operating capacity cut by nearly half, which, from a commercial standpoint, “is pretty damn awful,” Brunet said.
The financial realities for restaurants are brutal, particularly in big cities such as Hong Kong, London, and New York. Costs are high and operating margins thin. Under lockdown, many British restaurants have been able to hit pause on costs such as staff wages (which have been temporarily covered by the government’s furlough scheme) and rent (which some restaurants have had to defer). But this assistance isn’t going to last forever, and should restaurants return to normal operating costs without the capacity or foot traffic to pay for it, they risk going out of business. “If we don’t get help, there’s going to be a hell of a lot of blood on the floor,” Brunet said.
The assistance isn’t just necessary for the industry and its workers—3.3 million in Britain alone—it’s also a way of preserving a community’s social fabric. “If you go to a small town in England, they’ve probably lost their High Street; they’ve probably lost their post office; they’ve probably lost the local library,” Will Beckett, the co-founder and the CEO of the British steak-house chain Hawksmoor, told us. “What they have left for community is the local pub or local restaurant. Those are the only things left in terms of public spaces that tie the country together.”
The types of safety measures being implemented in Hong Kong, such as physical barriers and temperature checks, might make patrons feel safer, Beckett said, but they could also cause them to view dining out as a public-health risk. “I think it would take an extremely long time for public confidence in restaurants to recover from that,” he added.
At Shing Kee Noodles, a restaurant that has been operating in the Sha Tin district of Hong Kong since 1956, Cheung Man-keung has seen what can happen when customer confidence vanishes. After a cluster of COVID-19 cases was linked to a hot-pot restaurant in a different neighborhood in late January, the reaction rippled across the city. Cheung’s establishment would normally have seen from 100 to 150 customers a night eating the dish. After the outbreak, orders fell to about 10 or 12. While business has started to return, a portion of his restaurant remains closed, and distancing regulations mean that his large tables, often shared by as many as a dozen diners, can seat only a few at a time.