The Resilience of Detroit Restaurants
Michelle Oliver, multi-media journalist for Live in the D on WDIV-TV 4, NBC, joined the Chamber to discuss the resilience of Detroit restaurants, looking back at how city restaurants pivoted during the pandemic.
Local businesses and restaurants have been pivotal in Detroit’s comeback, and when the COVID-19 pandemic hit, it hit restaurants particularly hard. In the first 22 days after Gov. Whitmer issued her stay at home order, the industry lost approximately $491 million in sales across Michigan. This profit loss compounded with constantly changing restrictions and regulations, increasing cost of supplies, and loss of workers had a large impact on business survival.
Community and Government Collaboration
But even in the face of financial hardship, Detroit businesses continued to put the community first. Restaurants collaborated with the community to donate food and offer discounts to front line workers, raise money to help support industry workers, and more.
“When they didn’t know if they were going to have a business, they still gave back,” said Oliver.
Collaboration did not stop at the community level. The government also stepped in to assist restaurants, quickly approving patio permits, closing streets to provide expanded outdoor seating, and creating distinct social districts.
Noted Oliver, “It’s small margins in this business, so every single table really makes a difference.”
Current Challenges
Now even with restrictions lifted, local restaurants continue to struggle with staffing issues. Data from the Michigan Restaurant and Lodging Associations shows that:
- 89% of restaurants say staffing is lower than normal.
- 66% of restaurants are more than 20% below normal staffing level.
- 62% of restaurants report higher operating costs.
In addition, many restaurants are facing monetary challenges created by recent floods through the metro Detroit area.
“If we don’t want to see streets of restaurants closed because they can’t deal with the repercussions of this flood, we have to do something,” said Oliver. “We will lose too much of our vibrant community otherwise.”
Response Panel: The Future of Detroit Dining
Following Oliver’s discussion, local restaurant owners took the stage to provide a look forward at the future of dining in Detroit. Stephanie Byrd, co-owner of The Block, Garden Theatre, and Flood’s Bar and Grille, Jeremy Sasson, founder and chief executive officer of Heirloom Hospitality, and Bea Wolnerman, owner of Bea’s and Bea’s Squeeze were joined by Rhonda Walker, anchor for WDIV-TV 4, NBC, to discuss how their businesses pivoted to create new opportunities.
Restaurants were uniquely impacted by the pandemic, with many unsure of whether they would survive temporary closures.
“We had some hard conversations. And it’s not over yet. We are still facing issues like the flood. Every day is something new, but I am cautiously optimistic,” said Byrd.
“We decided to make a commitment to Detroit and look at our projects as creatively as we could. We have a butcher shop at Prime and Proper and half of our culinary team turned into delivery drivers for cut meats, giving to those that didn’t have,” said Sasson. “This business is a challenging one and I think we are built for these challenges.”
For many businesses, the pandemic meant changing their whole model to adapt and survive. Bea’s, which launched in 2020, started as a co-working space with an on-site café but quickly turned into a local event space.
“We converted our café and co-working space into event space and started hosting tiny weddings, and that really took off for us,” said Wolnerman.
Lasting Changes and the Future of Restaurants
Even with restrictions lifted, the future remains unsure for many, but what’s certain is that some industry changes will likely remain.
“We are still figuring out the day-to-day. It’s rapidly changing, and I think we just have to be prepared to change along with it,” said Byrd. “I do think collaborations and partnerships are the future.”
Added Sasson, “I think people in this business have an emotional attachment to servicing others and I don’t think that changes. In the food service and hospitality space, it will either tend to look like a convenience or an experience.”
Survival for the industry, post-pandemic, hinged on many businesses pivoting, and investing in innovation and technology, and becoming more community-based.
Prior to the pandemic, Sasson was launching a new restaurant concept that had to come to a halt when the pandemic hit. Now over a year and a half later, Sasson is working to give people a reason to come back out to restaurants.
“I look at this as an opportunity. I think reinvestment in what you have is also key. Put money back into your project,” said Sasson.
Staffing Challenges
As Oliver noted, 89% of restaurants have staffing that is lower than normal creating challenges as businesses work to return to pre-pandemic levels.
“Even on a smaller scale we are experiencing that. It’s been extremely challenging to find help that is up to the standard of our café. One thing we did to innovate and compensate for the lack of help was create a new menu, a choose your own adventure style,” said Wolnerman. “They fill their [order] out on a piece of paper and hand it straight to the barista. It cuts back on the number of people involved in the process.”
Added Sasson, “We’ve had to adapt, we’ve had to pay more and offer more services and benefits to what our compensation program looked like prior to. We’ve now hosted 13 days of jobs fair and hired 16 people in 13 days. In 2015 when we opened Townhouse Detroit the first time, we only hosted two or three days of job fairs and hired 150 people. The line for hiring is not long, but retention of your employees should be the focus.”
Byrd who co-owns a downtown Detroit staple that has been around since 1987 and has staff that has been employed by Flood’s Bar and Grille for over 30-years, stressed the need to treat your staff well and retain them.
“Our temporary solution has been to bring family out of retirement. We are a true family business,” said Byrd. “For now, uncles, cousins, aunts, the whole family is back working.”
Sponsor: Michigan Economic Development Corp.