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Operations

Restaurants blow up their business models to thrive post-COVID

Reinvention is the key to recovery for these independent operators.
Alma Arepas
Photo courtesy of Alma Cocina Latina

Like many restaurateurs, Christianne Ricchi, chef-owner of Ristorante i Ricchi in Washington D.C., had to turn on a dime when her Tuscan-inspired restaurant was shut down in March. To keep the business going, she launched the I Ricchi Food Club, featuring a curated four-course Italian dinner available for order-ahead and pickup. The price ranges from $43 to $49 per person for one pickup, with a 20% discount if customers sign up for a once-a-week, four-week subscription. Each meal comes with a candle, optional wine pairing and personal travel notes relating to that night’s “culinary journey.” Ricchi’s goal was to create a restaurant experience at home.

“About 80% of people signed up for all four weeks,” says Ricchi. The Food Club continues to generate revenue and keep expenses in check. “I know exactly how much food to order each week, how many meals to prepare and how much staff to enlist,” she says. The concept also sparks her creativity as a chef, Ricchi adds, as she’s excited about developing a new culinary journey every week.

There’s no question that the pandemic has been devastating to the restaurant industry. A number of independents have permanently closed, unemployment is sky high and even upon reopening, capacity restrictions will severely impact profitability. Like Ricchi, some are discovering that new models can be economically viable and personally rewarding to run—at least for the short term. Other operators are ditching their old formats in favor of concepts that are less risky, involve less labor, offer higher margins and better meet the needs of younger diners and a struggling economy. And still others are combining what worked best during the pandemic into a hybrid model.

A food-focused neighborhood hub

The uncertainty of a second coronavirus wave is why Greg Baxtrom is not reopening his Brooklyn, N.Y. restaurant, Olmsted, in its former mode—at least until next spring, when a vaccine may be widely available. He is currently operating a food bank in the main restaurant space and the Olmsted Trading Post out of the private dining room, which has its own entrance and garden.

While a number of restaurants started selling groceries during the pandemic, many abandoned the idea once they geared up for reopening. Baxtrom intends to keep Olmsted Trading Post going, expanding operations to seven days and adding delivery. “Shoppers line up every day,” he says. “We sell about 200 items, many of which people can’t get at their regular grocery store, plus prepared foods from our menu.”

Olmstead

Among the draws is a full-on bakery, stocked with baguettes, sourdough breads, brioche, cookies and other scratch-made goods baked daily by pastry chef Alex Grunert. Baxtrom and his staff prepare specialties such as duck pastrami, duck rillettes, pickles, chutneys and other Olmsted signatures to add to the roster, along with cooked meals to take home and reheat. Also for sale are batched cocktails, wine, branded beverages and seasonal specialty produce that Baxtrom picks up at farmers markets on a regular basis.

“The grocery store brings in revenue, but I still can’t bring back all of my staff,” he says. In addition to increasing hours of operation, he plans to add more takeout, including picnic boxes and regional specialties, and open his garden for cocktails, snacks and coffee service.

But the future of the food bank is more uncertain. It’s been going strong since mid-March, originally set up to feed unemployed restaurant workers, but eventually opened to all in need as well as frontline workers. Baxtrom receives support from the Lee Initiative and a food company, which provide funds to purchase supplies and pay staff. Donations of food from chefs and local producers help defray costs too, providing enough to cover 300 meals a day.

Olmstead

“The crisis is not over and we have to keep doing this, but if the funding dries up I don’t know what will happen,” he says. Baxtrom is investigating other nonprofits for funding but he also wants to put more effort into his other plans. “I need to get busier saving my business,” he says.

Dual roles for the same space

Alma Cocina Latina in Baltimore also transformed into a relief kitchen during the pandemic, feeding communities in need. Chef-owner Irena Stein works with Mera Kitchen Collective, a nonprofit that creates jobs for refugee and immigrant women, to staff up, with funding provided by Jose Andres’ World Central Kitchen. She is currently doing 3,000 meals a week. “We work miracles on a very limited budget,” says Stein.

“I am going to continue the relief kitchen going forward, operating it during the day to feed communities in need, and opening as Alma Cocina Latina only in the evening,” she says. Social gastronomy, also referred to as food justice, is central to her mission, and Stein feels that it is especially important to redistribute food equally throughout the community in times of crisis. But the plan also makes business sense. “I can only fill my restaurant 50% full, so I can’t rehire all my employees or offer the same menu,” she says.

Alma

Previously, Alma’s Venezuelan-rooted menu offered several courses—appetizers, salads, soups, entrees and desserts—with the open arepa bar at the heart of the restaurant. Stein is now downsizing the menu to focus on arepas and a few small plates along with Alma’s signature cocktails. “Guests can have a quick meal and cocktail, then go. That allows me to turn tables faster and increase customer counts,” she says.

The daytime operation taps into the different nationalities of the kitchen workers to create homestyle global dishes from scratch. A chef leads the team, ordering the food; everything is fresh, healthy and zero-waste, says Stein. Each meal includes a protein, carb and veggies, and ingredients are roasted or grilled, never fried.

“I have a quick muscle for reinvention,” says Stein. “Alma is not just in survival mode; the new concept has a cultural component that conveys an important message through food.”

The new face of full-service

Palette

Some high-end restaurateurs took time during coronavirus closures to reassess and physically remodel their operations. At Palette in San Francisco, an art-inspired restaurant with a gallery for local talent, chef-owner Peter Hemsley is changing up the footprint to accommodate social distancing and decreased capacity.

“We are fully separating the bar from the dining area with banquettes to provide both physical and psychological distance,” says Hemsley. And since he has to cut down on bar seating, he is renovating the gallery to accommodate bar overflow. “We used to have a separate retail space in the gallery to promote artisans, but now we are going to do all our sales online and feature a rotating artist in residence in the space,” he says. “Going forward, I see the gallery gaining a reputation as a place to hang out with a drink and bar food,” he adds.

Previously, Palette could seat 225 guests, but the city will mandate a reduction to about 100 for the immediate future. The new floor plan can seat 80 comfortably, Hemsley says.

Palette

Palette had been relying on takeout and grocery sales during its closure. Hemsley is dialing back on the groceries but continuing to sell market baskets of produce from the farmers market. “Takeout will continue to be the bulk of revenue for the remainder of the year,” he predicts, adding that he plans to introduce new carryout options. “Takeout is where America is going and will continue to go,” he believes.

Across the bridge in Oakland, Calif., Nyum Bai switched to takeout at the beginning of the pandemic, offering Asian comfort food dishes. But after four weeks, owner Nite Yun discontinued the program and closed her full-service Cambodian restaurant to rethink the concept.

Yun decided to reopen Nyum Bai as a fast casual with a menu of Cambodian street foods, she told Eater. In a virus-phobic world, demand is not high for the shareable, family-style dishes she previously served, but items such as pork buns and sausages are customer-friendly. The revamped concept includes a grab-and-go case, a takeout window and a limited number of seats.

Although Yun and Hemsley are operating restaurants in very different segments, menu prices will be lower compared to pre-COVID days. “We’re acting in response to people’s pocketbooks,” says Hemsley.

 

 

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