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Why Some Businesses Should Consider Staying Closed Even When Restrictions Ease



Why Some Businesses Should Consider Staying Closed Even When Restrictions Ease

It doesn’t matter how you think government officials have handled COVID-19, social distancing is the new norm. As a business owner or leader, you must cater to the perceived views of your most valuable assets—your customers and your employees. For restaurants, that means taking new precautions before reopening your dining room, even if your local government may allow it.   Each state’s policy is different, and governors and other state officials have either vacillated or changed their minds on what to allow. Being among the first to open may at first seem prudent, but a conservative approach could prove more valuable long term both financially and in the court of public opinion.

Walk, don’t run. 

Some businesses, mostly out of necessity, will undoubtedly open as soon as they are able. Instead of rushing to open before you have systems in place, take time to ensure you and your employees are ready, both mentally and with additional policies and procedures. Its likely consumers aren’t yet ready to return to their normal activities, which includes dining in a crowded restaurant.  Even though it is pent up demand, consumers have now adapted their lifestyles due to the mandated closings, and many will be slow to return to crowded areas. Be very cautious in reopening under the old rules, and assess now how you should adapt your business to fit consumers’ new lifestyles.

For example, Penn Station is strongly recommending franchisees leave their dining rooms closed until May 18 at the earliest—and possibly the entire month of May—even in states or cities where restaurants are allowed to reopen dining rooms. The main reasoning behind this policy is the safety of our valued customers and crew. We have seen a huge stress level in operators, general managers, employees, and customers with maintaining six feet of distancing in a restaurant. To ease that stress, we believe it is more prudent to wait to open the dining rooms for now. We will continue to offer carryout via call-in and online ordering, but we will open our dining rooms on our terms on a more conservative basis so guests and crew feel safer.

Consider customer perception.

The last thing you want when you reopen your business is to create a hostile environment for customers. Differing customer views will create conflict on issues like wearing a mask, social distancing, re-filling drinks at a self-serve beverage machine, condiment stands, and restroom usage. The list is endless. You may also see added stress for employees who feel they must enforce policies with customers who do not listen, do not care, or simply think the state-mandated policies are over-reaching. Why add these kinds of stressors within your four walls?

Consumers know COVID-19 is not a foodborne illness. Rather than provide them any reason to perceive restaurant dining rooms as unsafe, it makes more sense to allow them to ease back into normalcy that today may seem out of reach. The same applies to all retail businesses. Think about what you can do to show customers your space is clean, sanitized, and safe. Clean surfaces much more frequently and specifically in front of customers. They will want the visual reassurance that you are using sanitizer and not just water to wipe tables and other high touchpoint areas. In the near future at least, customers are likely to be hypersensitive to cleanliness and sanitation.

Plan ahead for reopening.

Whether you are voluntarily staying closed or your state hasn’t allowed you to re-open, use this time to plan for what reopening looks like for your brand. Anything you do now to plan for the future will put you ahead of the curve against the competition. Ask your franchisor to provide guidance on re-opening, advanced cleaning procedures, designing the space for six feet of social distancing, and more. Each state will vary, but the franchisor should able to give general best practices.

Think about what reopening will look like. It will be different than before you closed to the public. Restaurants will still have many more carryout orders than they did before COVID-19, even when the dining room is open in some capacity. Evaluate your packaging options, and make sure you have priced out these items beforehand, especially if they are not products you typically use to operate your business. Your paper costs may be substantially higher, especially if you are buying items individually instead of in bulk. Negotiating out of desperation will clearly put you and your income statement at a disadvantage.

Walkthrough your customer’s experience for when you reopen. Many things may be different, even once all government regulations are gone and things are “normal.” If you previously had pumps for condiments, you may want to use single-serve packets instead. Refills on fountain drinks at casual dining restaurants may need to be temporarily stopped. Food may all be served in disposable packaging. All of these considerations can help reduce contact and touchpoints between customers and employees, which will be the goal for at least several more months.

Analyze your financial statements in detail, too. For some restaurants, especially mom-and-pop restaurants, it may not be worth the cost of operating your dining room at the lower occupancy allowance rates many states are requiring upon reopening.

Some industries have been hit harder than others by COVID-19. Even within one industry, different businesses are struggling at different rates. Because of the almost-universal decrease in sales, many businesses may rush to reopen their doors. Instead, think carefully about the experience from your customer’s point of view and how their expectations have changed.  Make sure you can offer a safe environment for both your customers and employees.

Craig Dunaway has been president of Penn Station since 1999. Before joining Penn Station Inc., Dunaway was a partner at the regional accounting firm of McCauley, Nicolas & Company, LLC in Jeffersonville, Indiana, where he had worked since 1982 in various staff and managerial positions. Dunaway has a bachelor’s degree in accounting from Indiana University and is still a licensed CPA. Dunaway formerly had ownership interests in a Papa John’s® franchisee that owned 11 stores, and he served as the secretary/treasurer for that Papa John’s® franchisee. In addition, he had ownership interests in Coastal Cheesesteaks, LLC (headquartered in Raleigh, North Carolina) until June 2011 and in Louisville Cheesesteaks, LLC (headquartered in Louisville, Kentucky) until January 2014, both of which are Penn Station franchisees. While a shareholder in those Penn Station franchisees, Dunaway served as secretary/treasurer. Penn Station was named one of the Best Franchises to Buy by Forbes in 2016 and 2018 and one of the Best Franchise Deals by QSR Magazine in 2016 and 2017.