Slowly but surely, those in the business community across Ontario are taking their first tentative steps toward recovery after the devastating economic impacts of COVID-19. An industry that was hit especially hard has been the restaurant industry – an industry with incredibly thin margins to begin with.
When the province was thrown into a sudden lockdown in March, restaurants had to close their dining rooms, and although many did their best to continue with takeout and delivery orders the financial damage done to these businesses was considerable. In phase 2 of the reopening, patios are now allowed but additional safety measures such as social distancing are still in force and therefore profits are reduced. And as we enter into phase 3 which includes indoor dining, restaurants need to operate at reduced capacity – again having a negative impact on profitability.
As restaurants re-open in phase 3, they will need to invest more capital in order to comply with new safety regulations in a post-COVID world. Expanding patios and investing in safety screens etc. will be added expenses for these businesses that have already suffered a financial blow. Add to this the uncertainty of how long phase 2 will last and whether or not there will be another wave of the virus, it is not wonder that so many restauranteurs are nervous.
So what can restauranteurs do to secure their recovery?
As we enter into phase 3, the restaurants that not only survive but thrive will be the ones that access available guidance and expertise; find ways to be innovative in their business, and get much needed funding for recovery.
At CORFinancial, we are offering a valuable resource called our COR Hospitality Advisory Group in which those in the hospitality industry can access consulting services and small business loans for $100,000 or more. The group will help business owners from everything to navigating new health and safety guidelines and implementing policies to menu analysis and team building.
COR Hospitality Advisory Group is headed up by Eric Satov, Senior Consultant.
“Thriving through innovation”
We have already seen many businesses pivot and innovate in order to survive the lockdown. Some restaurants have offered online cooking tutorials to keep their customers engaged while others have expanded into offering grocery service along with their takeout.
This innovation will have to continue as we enter phase 3. Restauranteurs may consider looking at new online options that do not cut into their profits with a service charge. Additionally, some will thrive on offering specialty menus such as Keto, ready to cook meals, and kids’ lunches. The options are numerous, and savvy business owners will have to decide where it makes the most sense to put their focus.
Succeed with the right team and the right funding
These are still unprecedented times, and the sad fact is that many restaurants will not survive. For restaurants to make it through the pandemic intact, they will need help and guidance. And they will need capital. For those that deny this new reality and keep their heads in the sand, they will eventually see the money run out.
But for those who are proactive, and take steps to defend and protect their businesses now – those are the restaurants that will be in a position to thrive in the post-COVID economy.
To learn more about CORFinancial and how the COR Hospitality Advisory Group can help your business, contact us today.
Eric Satov – Senior Consultant, CORHospitality Advisory Group
Eric is a Senior Consultant with COR Hospitality Advisory group. He has over 20 years of experience in the hospitality industry working directly in operations, financial analysis, team and group leadership and maximizing the use of technology available. Eric has always understood that the dynamics of the customer, employee and shareholder relationships are the foundation for creating sound business solutions. Eric is a problem solver who brings a host of hands-on experience when taking on and managing client engagements.