Meals to go have become the status quo as COVID-19 takes a large bite out of the restaurant industry. The Texas Restaurant Association predicts the state’s restaurants will shed almost 690,000 jobs and suffer lost sales totaling $4.2 billion through April, citing coronavirus-related wreckage since March 1.
Dorothy Lentis, who owns Alpha Omega, a Mediterranean grill, sweet shop and coffee bar at 929 Franklin Ave., said she can relate.
“We’re struggling, trying to make ends meet, keep the staff employed,” Lentis said.
To her rescue came a $52,000 loan via the Payroll Protection Program included in the national coronavirus relief package. She applied in early April, as COVID-19 was gaining momentum, and the First National Bank of Central Texas help her navigate the process.
“Today is the first day I’m using it,” Lentis said of the loan proceeds. “It will serve me about a month-and-a-half. It’s almost exclusively for payroll, but under narrow parameters, a percentage can be applied to utilities.”
Lentis said her bank also graciously provided a flexible line of credit, “just in case,” and placed a temporary freeze on her monthly loan payments.
When asked, she said she hopes the COVID-19 pandemic will not prove lethal to Alpha Omega.
“We’re taking every measure to keep people employed. We hope to continue to grow and serve a community that has supported us through this ordeal,” Lentis said. “No matter what, we’ll have loans to pay back when we get reopened. Next year could be a hard year for restaurants all around, not just us. Others are taking out loans, trying to survive.”
The latest COVID-19 update from the Texas Restaurant Association paints a bleak picture of an industry that employs 1.12 million people. It reflects a survey taken of 6,500 restaurant owners and operators:
- 84% have laid off or furloughed employees
- 6% expect to permanently close within the next 30 days
- 96% say their total dollar volume between April 1 and April 10 was below that for the same period last year
- 34% have temporarily closed their restaurants
- 63% expect to be serving only for off-premises dining the next 30 days.
“Our industry is being impacted more than anybody, if not the highest, then among the highest,” said Kyle Citrano, managing partner of the George’s restaurant and bar on Hewitt Drive and president of the Waco Restaurant Association.
George’s on Hewitt Drive employs 110 under normal circumstances, but furloughs have lowered the head count to 40 or 45, Citrano said.
He said he has secured a Payroll Protection Program loan through a local bank and authorized by the Small Business Administration, though he said he would prefer not to identify the local bank he used or the loan amount.
“The loans are based on payroll,” Citrano said. “You take total payroll for a year, divide it to come up with a monthly average, and multiply that number by 2.5. That’s the maximum amount of the loan. You must first spend it on payroll and certain benefits before it can be applied to mortgage interest, if you own the building, and on utilities. But payroll comes first.”
Citrano said his loan can be forgiven if has met certain staffing guidelines by April 30, but he has concerns about meeting the quota.
“I would prefer the deadline be pushed back to Dec. 31,” he said.
The pain is being felt industrywide.
“I can’t speak for anybody but myself, but I can say the longer this goes on, the harder it’s going to be for people,” Citrano said. “Everybody’s numbers are down, for sure. A lot of restaurants aren’t geared for mass numbers of to-go orders. I think we’ve done as well as you possibly could in that area, but we’re still down a significant amount. Lunch is a big part of our business, and that’s way off. If you’re not working, you don’t want to go out for lunch.”
Alcohol sales have declined, as the George’s Big O goblets of beer do not necessarily travel well, Citrano said. His father, Sammy Citrano, operates the George’s location on Speight Avenue in South Waco, where employment there has slipped from 125 to between 25 and 30, Kyle Citrano said.
Citrano said uncertainty continues to plague restaurateurs.
“We just don’t know what’s going to happen. There are yet no guidelines on the number of guests to be allowed in restaurants when they do reopen. No clue,” he said. “This could be going on the rest of the year, if not next year. We continue to work with the Greater Waco Chamber and the Restaurant Association to get out whatever information is available.”
Banks, loans
Community Bank has seen a flood of inquiries from small business clients, including restaurants, said Ben Lacy, senior vice president for commercial lending at Community Bank & Trust.
“So far, knock on wood, we’ve been very successful in getting relief,” Lacy said of the bank’s involvement in the Payroll Protection Program.
He said the program’s loans are available at 1% interest.
“It’s challenging to run a restaurant in good times. Now it’s almost impossible,” Lacy said.
The bank is considering other loan requests on a case-by-case basis in addition to Payroll Protection Program assistance.
“We help where we can,” Lacy said. “More are inquiring about loan payment deferrals than wanting additional money. I can’t think of one instance where we said no. Economic conditions are pretty much unprecedented.”
The Texas Restaurant Association also issued what it called ”The Texas Restaurant Promise” in anticipation of dining rooms reopening.
The list of measures intended for restaurants to post at their entrances states: “All employees will pass a health check or complete a health survey prior to each shift; All indoor and outdoor seating options will comply with the appropriate social distancing guidelines; Hand sanitizer or hand washing stations will be available to all customers and employees; We will clean and sanitize common areas and surfaces regularly; We will clean and sanitize each dining area after every use; Place settings, utensils, menus, and condiments will either be single-use or will be cleaned and sanitized after every use.”
The documents also requests that customers use delivery options if they have symptoms of COVID-19, or if they have underlying health conditions.
— WACOTRIB
