Restaurants, bars brace for most challenging winter ever

Restaurants and bars are running short on innovative ways to stay afloat as surging coronavirus cases and colder weather close in on some of America’s most vulnerable businesses.

The remaining establishments in the food and beverage service industry — one of the hardest hit by COVID-19 — have ramped-up delivery and takeout, expanded outdoor seating and a released wide range of new offerings to survive the first nine months of the pandemic.

But as the U.S. braces for the most daunting stretch of the pandemic yet, restaurants and bars say they’re running out of time and options to make it to the other side. Without federal aid, they warn, the industry could be decimated as restrictions and health risks make staying in business untenable.

“This is running as tight and as lean as we possibly can while still being able to create a good customer experience, and I just don’t know how long we’re going to be able to maintain this without another round of help,” said Julie Verratti, co-founder of Denizens Brewing Co. in Silver Spring, Md.

“We’re just trying to survive out here, and we need all the help we can get.”

The dangerous nature of close crowds gathering in tight spaces and talking loudly amid the pandemic has forced restaurants and bars to find safe and creative alternatives to their normal operations. With indoor dining and drinking severely restricted throughout much of 2020, the industry has sought to squeeze all it can out of its products and expertise.

Outdoor dining, delivery and takeout have been among the most widely adopted by restaurants and bars. Before the pandemic, alcohol was off-limits as a takeaway item for most jurisdictions.

Dan Kleban, founder of Maine Beer Company, said outdoor dining helped his tasting room and brewery operation make the most out of a challenging summer. The company also sold a range of local goods like oysters and bags of flour as they flew off of grocery store shelves in the early days of the pandemic.

“You’d go to a grocery store and couldn’t find flour, but we had access to it because of our restaurant operation,” Kleban said. “Brewers by nature are innovators, as are a lot of small-business owners, so it was about trying to adapt to a new reality.”

Special menu offerings like premade holiday dinners and date-night packages have been a mainstay amid COVID-19. And some restaurants have even opened “ghost kitchens,” delivery-only menus branded with a different name but produced from the same facility.

Owners, however, have seen mixed and inconsistent success with those projects.

Verratti said that a plan to sell baked goods and other food products from local vendors has not taken off and may need to be scrapped. Denizens was sold out of premade Thanksgiving meals weeks before the holiday and got rave reviews from customers, but hasn’t seen the same interest in Christmas packages.

“It’s a weird position to be in because you just don’t know what you can rely on,” Verratti said.

Some restaurants and bars have tried to stick with their pre-pandemic operations.

Devin Gong, owner of Copycat Co. and Astoria in Washington, D.C., said his sister businesses are trying to push through to spring with the Chinese food and cocktails that brought them to prominence.

“We don’t want to change our business model and rethink what we’re doing philosophically,” Gong said. Even so, he’s offering cocktail classes to bring another source of revenue amid strict dining and drinking restrictions.

“This is the last push to get through until quarter three of next year,” he added. “Quarter one, quarter two is going to be just about survival.”

Economists fear that surging coronavirus cases throughout the U.S. could plunge the economy into another recession over the winter, which would likely bring a sharp drop in consumer spending. Restaurants and bars will also have fewer ways to serve customers once winter removes outdoor dining as an option across much of the country.

“I know people are trying the best they can to set up cozy outdoor spaces, but when it gets down to 10 degrees and there’s two feet of snow on the ground, it’s just hard to accommodate folks outside,” Kleban said.

“Without federal help, I don’t see any way around an economic catastrophe for us up here in the colder regions.”

Kleban and Gong said that another round of Paycheck Protection Program loans could help restaurants and bars hold on to staff and make it through the winter, though others in the industry have been more critical of the program.

Verratti, a former Small Business Administration (SBA) official, and Kleban also said the federal government should renew a CARES Act provision that provided six months of payments on preexisting SBA loans.

More help could be on the way within weeks. Both parties have made progress toward another round of coronavirus relief, and a $908 billion bipartisan measure that could be the basis of an agreement included $300 billion in small business aid.

President-elect Joe Biden has also called for another economic aid bill after taking office on Jan. 20 and expressed support for direct grants to struggling businesses. The bipartisan Restaurants Act, which would provide $120 billion in grants to independent restaurants to cover pandemic-related losses, could be a part of that discussion.

Even so, past pushes for economic relief have ended up with little to show for it, and the possibility of a divided Congress could slow efforts to pass major legislation in 2021.

“We’re not going to hold our breath for the government to help out. We can’t do that,” Gong said.

“If the government helps out, great. If they don’t, we need to find a way to survive.”