Restaurant Owners Unite for Support, Bargaining Power

Written by Aaron Wise
Wednesday, May 13, 2020 at 10:01am CDT

As one of the most negatively impacted industries, owners of restaurants are joining together as they begin their long road to recovery. “We need to come together. Great to see how restaurant owners and workers around the metro region are stepping up,” says Congressman Jason Crow. “Good things happen when neighbors come together,” says Hielly Martinez. “Let’s come together and show support for our area restaurants! They need us now more than ever!” tweeted another community leader yesterday. Another patron agreed, “Let’s come together and help each other shine. Every restaurant deserves its own moment.”

Restaurant owners have made their voices heard, sending letters en masse to their congressional representatives. The largest group is the Independent Restaurant Coalition with over 30,000 members. Members are lobbying Congress for a so-called Independent Restaurant Stabilization Fund totaling $120 billion. The coalition is also asking for tax rebates, loan extensions, and an extension of business interruption insurance.

Restaurateurs have also succeeded in convincing Representatives Glenn Thompson and Dwight Evans to introduce the bipartisan AG CHAIN Act which would provide a payroll tax exemption and federal tax holiday for essential employees in the food and agriculture industries. If the AG CHAIN Act becomes law, the provisions will apply from February 15, 2020 through June 15, 2020 for individuals making less than $75,000 annually. The bill would also provide discretion to the Treasury to extend this benefit for an additional three months.

“Give us a safety net that includes rent relief,” pleads one restaurant owner today. “We need to do more to support our restaurant owners and employees. We were the first shut down and we’ll be the last to reopen,” said another. Indeed, employment fell by 20.5 million jobs in April, including an estimated 8 million restaurant industry jobs. The industry’s lost revenue to date exceeds $80 billion.

Many will recall the meat shortage that threatened supply chains a couple weeks ago. Although President Donald Trump forced a resolution of the issue on April 28 by invoking the Defense Production Act to guarantee meatpacking facilities remained open, the prices for beef did spike in many areas of the country. During the meat shortage in Massachusetts, a Sonic franchisee ran out of ground beef for hamburgers. He called a nearby owner of a high-end butcher shop asking for emergency assistance. The butcher agreed, and is still supplying ground beef for Sonic as of today.

Unfortunately, catastrophic losses have forced some owners out of business entirely. Steak ‘n Shake announced this week that it is permanently shutting down 51 of its locations. Also this week, Sweet Tomatoes announced the closure of 97 locations including all 4,400 jobs. Souplantation will also close all locations permanently. Additional chains including Bamboo Sushi, Toojay’s Deli, Bravo Cucina and Brio Tuscan Grille have closed permanently. An estimated 10% of restaurants in Oregon will shutter for good. Over half of restaurants nationwide are closed at least temporarily.

Photo by Louis Hansel @shotsoflouis on Unsplash