Why Restaurants Are So Fucked — Part II

It’s been 18 months since I wrote the post on “Why Restaurants Are So Fucked”. It was just something I needed to get off my chest. I never expected it to go viral and hit a million views. Or to be a guest on podcasts from LA to Melbourne and re-published up in a Thai paper. It was kinda cool though.

For a while, things actually seemed to get a little better. We were adapting. As vaccination numbers rose, I was hopeful. Until it all backfired. As things began to re-open, many expected everything to be all good again — just like that. In reality however, we were just beginning to feel the aftermath of COVID-19. I hate to admit it, but restaurants are so fucked. Again.

And it may even be worse this time: staffing shortages, supply chain collapses, new variant surges — and all this when we are already exhausted from almost two years of this shit. Plus, the icing on the cake is some people actually blame us for all this, getting angry when we are closed or don’t have certain menu items — as though we just forgot to hire staff or order tomatoes.

I know you’re frustrated. We all are. I get it. But, try not to take it out on us — it’s out of our control. You have no idea what we’re dealing with. You know, maybe that’s the problem, you just don’t know. I’m sure if you did, you would understand. That’s why I’m writing this.

For context, my restaurant Wolf Down currently has a location in Ottawa and one in Vegas, as well as ghost kitchens in Toronto and Calgary (as we attempt to adapt to the new reality). This is based both on my own personal experiences, as well as those of my friends in the industry.

Let’s start with the supply chain. Until recently, restaurant food seemed to just magically appear whenever we wanted it. We didn’t know how, or where it came from. We didn’t care. We were fed. And we were happy. But, all of a sudden…

“Why are you out of chicken?” chicken shortage due to COVID. “Why don’t you have bread?” the bakery closed due to COVID. “Where’s the Diet Dr Pepper?” aluminum shortage due to COVID. “Why don’t you have anything!?” Sysco has no truck drivers due to COVID. Do you see the common denominator here?

“Labor problems are causing major disruptions in the supply chain, making it difficult for meat processors to get staff to produce chicken or beef and leaving distributors without drivers to get goods to restaurants.” — Restaurant Business

Every time we place an order, it’s basically a gamble to guess what’s sold out. One week it’s tofu, the next it’s tomatoes, then we actually get all the ingredients, but no bowls to put them in… we’re constantly scrambling. I mean, even Heinz ran out of ketchup.

“Taco Bell declared: “Due to ingredient shortages and delivery delays, we may be out of some items.” Fans turned to social media with their disappointment. “For anyone craving Taco Bell, they don’t have chicken or beef, national shortage or something... I just ate black beans in a hard shell” a customer tweeted. “They couldn’t make burritos since they were out of tortillas, and none of the tacos had lettuce or tomato” another posted on Reddit.” — CBS

Think about it, if Taco Bell can’t even get tomatoes or tortillas, how do you expect your local shops to keep stock?

“First there was a chicken shortage. Now a dipping sauce shortage has Chick-fil-A rationing handouts, allowing just one sauce per entrée. The company said it is doing everything it can to restore its supply. “Due to industrywide supply chain disruptions, we are experiencing a shortage of select items.” — CBS

Even Chick-fil-A is struggling — and they’ve got God on their side! Do you know how much it sucks to have to tell you we don’t have what you want?

https://www.adn.com/nation-world/2021/09/15/heres-why-your-food-prices-keep-going-up/

It just gets better, cause what we can get, costs more. Remember when that big ass boat got stuck in that canal, blocking all the other big ass boats? “Who cares! Where’s my chicken nuggets?”. Did you know 80% of goods travel by shipping container? Due to the backlog caused by Evergreen, and the lack of ship yard workers, shipping containers are stuck at ports unable to unload. So ya, that’s kind of a problem. Oh, and a container that cost under $2k last year, can now cost more than $14k. Yikes.

All of this trickles down. Sysco, one of the biggest food distributors, showed food inflation of 10.2% on their quarterly report. So what do they do? Pass it down to us of course. Like a game of hot potato.

“Menu inflation hit a 39-year high as soaring costs for labor and food led restaurants to increase prices. Prices for limited-service rose 7.9% over the past year. This level of inflation typically pushes consumers away, but grocery prices are not much better, rising 6.4% year-over-year, and outpacing restaurants for the past 3 months.” — Restaurant Business

It’s not just restaurants. Grocery stores too. And like everything else. The inflation rate for 2021 is 6.1% in the US and 4.7% in Canada — double or triple the normal average. What that means is don’t be surprised when our menu prices go up.

You may have noticed some restaurants are hiring. And by some, I mean all. The massive staffing shortage in our industry has three major culprits: the lack of pandemic relief funds from the government, the low wages endemic to our industry, and, last but certainly not least — the lovely Karens.

Let’s start with the government paying workers to stay home. First, let me say that anyone high risk, or with young kids at home, I totally understand. This isn’t directed at you. But I’m talking about the restaurant industry. We employed 1.7M teens in the US before the pandemic. Of course they rather get paid to Netflix & chill than scrub dishes. I don’t blame them. I’m not exaggerating. I know this. How? They told me. They’d ask to only work a few shifts a week or else they wouldn’t get their ‘free money’ as they put it. This made it nearly impossible for us to stay open. It has gotten a bit better now that these programs have wrapped up.

I don’t know, but seems to me like basic common sense (or decency?) that if you force a business to shut down for public safety, shouldn’t you at least cover fixed expenses (since we still have to pay rent, utilities, salaries, etc.)? We got a few grants, but nowhere close to what we lost.

And we’re one of the lucky ones since we were able to pivot to take-out and delivery relatively quickly vs our full service restaurant friends who rely mostly on dine-in. My heart bleeds for them. It just doesn’t seem right that they lose money when the government makes it illegal for them to operate. I mean, clearly they understand the concept…

“Airlines will receive billions of dollars to pay flight attendants, pilots and other employees. This agreement will fully support airline industry workers and preserve the vital role airlines play in our economy. They will get over a very tough period of time that was not caused by them.” — New York Times

How thoughtful. Must be nice. What about restaurants? They left us to bleed like Impossible beef.

“Other industries have received targeted federal relief. The first COVID package dedicated nearly $50B to help airlines avoid mass layoffs. Then, they passed another $900B emergency stopgap including the Save Our Stages Act for live venues forced to close. The restaurant industry did not receive dedicated funding, though few sectors have suffered as much.”— Mother Jones

Instead, by paying our workers directly, the government looks like the fucking heroes while we look like losers that can’t take care of our own people. Its gut wrenching to tell your team, who in many cases have become like family, that you can’t pay them. We’re in hospitality for a reason. Naturally, this has bred distrust and caused good people to no longer believe we can take care of them. So they leave our industry for more secure jobs. Who can blame them?

“Restaurants deserve a cash infusion that is direct and commensurate with the blow the pandemic has dealt the sector. The government shut down our industry, which I completely understand for public safety. What isn’t rational is not planning for the ramifications of having to lay off our workers.” — CBS

Here’s the kicker, when the government finally allowed restaurants to re-open, somehow they thought it still made sense to keep paying workers not to work...? They basically created the perfect storm: all this pent up demand from diners — and no supply of workers. This led to angry guests, who take it out on us.

Next up, the notoriously low wages in our industry. Luckily, people on FaceBook have come up with the solution: “Why don’t you just pay them more?” Great idea! “If you paid people more and took better care of them, you wouldn’t have this problem.” I love it. But, just making sure we’re on the same page here — you’re cool with paying more so we can afford it right? Margins are already thin and food cost is through the roof, so the only way for us to pay more, is for you to also pay more. It has to come from somewhere.

We’ve always paid above minimum wage, but we’ve still got lots of work to do to push industry wages up to where they belong. Chipotle has recently increased both wages and pricing. McDonald’s as well. It’s a start. Increasing minimum wage is a good start because for this to really work, it needs to be a level playing field.

Last, but certainly not least: the Karens. The amount of shit my staff puts up with is mind-boggling. We’ve learned to cope by turning them into memes or inside jokes, but still, some days I just can’t. With all this, are we really surprised no one wants to work for restaurants anymore?

“Another group shoulders some of the blame: consumers who have treated workers poorly and led some to quit and refuse to return to the industry.” — Business Insider

We’re not through this yet. And it’s probably gonna get worse before it gets better. We thought vaccines would save us. But, it’s been relentless. And now Omicron shows up, just in time for the holidays. In Ottawa, they just shut down indoor dining again, with almost no warning.

For the longest time, I was determined not to blame COVID. Instead, I blamed myself. Thanks to the pandemic, everything is 10x harder right now. I’m sorry if I come across a bit snarky, but we can’t keep sugarcoating forever. If there’s anything positive I’ve gained from COVID, it’s thicker skin. It’s not much of a silver lining, but with all the shit we’ve been through, I’m basically triple vaxxed against giving a fuck. So this might just be the opportune moment to say fuck it: raise wages and increase prices — let’s rebuild better. What have we got to lose?

But I can’t do it alone. We have to do it together as an industry. And we need you, our guests. I ask for your help. First, be kind. Second, be understanding when prices increase, when we run out of something, when we can’t open, etc. We’re exhausted, but I promise we’re doing our best. Lastly, please share. A little empathy can go a long way.

Startup Founder. Poker Player. Street Food Addict.