Every year brings a new list of restaurant heroes and villains. The louts on this third list merit their own dastardly designation. Here are the crumbs who won’t be getting so much as a Happy Holiday from us because of how they treated restaurants in 2022.
Lawmakers who voted against re-upping the RRF fund
Just a mention of the Restaurant Revitalization Fund might dampen your holiday spirit. How could a program with so much promise go so horribly wrong? Conceived as a way of saving local restaurants, the RRF was given $28.6 billion by Congress in 2021 to provide restaurants with the means to pay their staffs and meet other overhead expenses until dining rooms were greenlighted to re-open. The industry was going under, and the $28.6 million was intended to be its lifeline.
But it wasn’t enough. The pool was depleted within about three weeks, leaving 177,000 applicants without a penny in aid.
The quick depletion kicked off a year-long drive by the industry to crowbar more money out of Congress. But lawmakers, seeing customers in their districts lining up for the limited restaurant seating available, didn’t believe the assertions that operators were still bleeding. In April, legislators decided the fund wouldn’t be replenished.
Their refusal to earmark more money was the equivalent of telling thousands of establishments to drop dead. May they learn this holiday that the IRS is planning to audit their taxes for the last 10 years.
The inflation gods
The pandemic was supplanted by galloping costs as the most likely cause of operator insomnia during 2022. Inflation hit historically high levels as Russia’s invasion of Ukraine lit a rocket under fuel prices, driving up the cost of most goods. Labor expenses, meanwhile, soared to space station altitudes. Management’s worries shifted from the top to the bottom line. Fortunately, customers tempered the impact by showing remarkable acceptance of higher menu prices.
Yes, they, too, suffered direly during the pandemic. But did they need to recover overnight? Many operators were alerted this year that rent payments deferred during the worst of the pandemic were due ASAP. Yet the sales volumes of many establishments had yet to rebound to pre-crisis levels, never mind hitting the threshold where back rents could be covered.
The collaboration and patience shown in 2020 and ’21 were in shorter supply, further straining the traditionally tense relationships between renter and landlord.
Cheating protein suppliers
Suppliers say success in the foodservice business comes from treating operator-customers like partners. Yet a rash of investigations and court actions revealed the giants of the meat and poultry industries had forsaken that commitment to mutual benefit.
Behemoths such as Tyson, Smithfield, Pilgrim’s Pride and JBS were accused by federal enforcement agencies of fixing production levels in bygone years to lift the prices paid for meats by restaurant chains and other wholesale customers. The allegations held that the purveyors had shared proprietary information for their mutual benefit in clear violation of federal anti-collusion laws.
That brought lawsuits from the likes of Chick-fil-A and McDonald’s aimed at getting back what they’d overpaid. Others participated in settlements intended to restore the companies’ good names. Smithfield, for instance, agreed to pay $28 million to chicken buyers who said they’d been ripped off.
Several of the actions are still pending.
Courts deciding insurance cases
The number of restaurateurs who believed they were insured against the loss of business from a global pandemic is unknown. Even a casual observer is likely aware of how many eating places were right in that assumption: Roughly zero.
Insurers refused to pay on business interruption policies, contending the coverage was meant to reimburse operators for physical damage to their establishments and the coronavirus left restaurants with nary a scratch. Nor, they said, were operators victimized by Mother Nature, the usual trigger for reimbursement. The insurers argued that restaurant closings were the result of government policies, not acts of God, and hence not covered.
That wrangling between insurer and insure-ee raged through 2021. This year, the conflict shifted into the courts, where matters were decided again and again in the insurers’ favor. But hope burns on: Panda Express’ suit to collect on its business-interruption coverage has yet to be derailed by a judge.
Give it up, folks. You dreamers have been predicting with galling confidence that it’s a matter of time before consumers are spending much of their existence in a simulated world far more interesting than the real one. Better get a restaurant open in that computer-generated existence before your competitors stake out the A-plus fake sites.
Isn’t this just a re-boot of MyLife with better tech? (Teens, ask your parents.) And even if customers do shift their consciousness to a computer-simulated better world, they’ll have to doff the simulator gloves and goggles to eat actual food. Why would the industry duplicate itself in virtual form?
Embargo-crazy PR departments
This is personal. In the not-so-distant past, the communications specialists for restaurants and supplier companies may have offered news leads two or three times per year in exchange for not publishing anything until a particular time on a specific date. The idea was to give the reporter more time to research and report big and complicated articles, like stories based on a big download of new data.
Now we’re being offered multiple embargoed stories per week. The notion is to create a wave of coverage by requiring all media to publish their stories on a development more or less simultaneously if they want the details. It also averts situations where one website balks at covering an occurrence because a competitor has already reported it.
It's BS we’d love to see end.
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