In a manner of days, which feels like minutes, the business of dining in at full-service restaurants across the U.S. closed down due to the coronavirus pandemic. Most states (40 out of 50 as of Friday afternoon) permit take-out and delivery orders only.
From New York City to San Francisco and many states and cities in between, dining out has become prohibited to protect citizens from each other and from catching COVID-19.
OpenTable reported in mid-March that dining out plummeted 45 percent in Seattle, 40 percent in San Francisco, 30 percent in New York, and 25 percent in Los Angeles and Chicago. And those numbers were before the shutdown, and are quickly plummeting.
Considering that nearly every style restaurant, upscale or casual, has faced closures and severe drop-offs in business, there’s one ethnicity that has weathered these cuts for over a month: Chinese restaurants.
Since the coronavirus struck first in China, most Chinese restaurants, especially located in thriving Chinatowns in New York, San Francisco, Los Angeles, Chicago and in other areas as well, were stigmatized early and resistance persisted. Though Chinese restaurants didn’t face any special exposure to coronavirus than other restaurants, they were maligned and most customers, driven by fear and paranoia, stayed away.
By relying on take-out and delivery, some Chinese restaurant chains are trying to be innovative. For example, P.F. Chang’s disseminated emails to tell customers that it’s offering free delivery. It also said it’s taking all precautions to adhere to guidelines set forth by the CDC.
This resistance to dining out at Chinese restaurants was due to “misperception in public awareness about how illness spreads. People are afraid of what they don’t know,” says Bridget Sweet, executive director of Food Safety at Johnson & Wales University, based in Providence, Rhode Island.
Since the outbreak was affiliated with China, “some people thought the only way to protect public health was to avoid Chinese restaurants,” she says.
“People will have missed going out. There’ll be a natural pop,” says Megha Agrawal, director of marketing at Inchin’s Bamboo Garden, of the COVID-19 crisis’ eventual end. “I don’t think we’ll have to do much but say ‘We’re open.’”
Sweet attributes their exaggerated reaction to “fear of the unknown and irrational fears.” If consumers understood that Chinese restaurants, like most others, must maintain proper employee hand washing and employees must not work if they’re ill, to meet health codes, they’d be more reassured, she says.
The overall effect on business at most Chinese restaurants from this pandemic has been “disastrous,” Sweet says. “It’s because people still believe that it’s transmitted by food and it isn’t,” she says.
Recent warnings to the public about how to avoid the coronavirus are more about social distancing and hand washing, but not about keeping away from certain ethnic foods.
The most effective way to cope with this drain on their business is to develop “creative social media messaging and public relations messaging,” Sweet says. She also recommends instituting curbside dining, where customers pay in advance by credit card, and pick up their food, while avoiding as much contact as possible with employees to ensure social distancing.
“If you’ve done a good job of curbside dining, take a video of it and post it on your social media site,” Sweet says.
When the pandemic slows down eventually, restaurants should offer incentives. Presenting a 10 percent off coupon might serve as a lure for some consumers, or free wonton soup on Friday night could resonate for others.
At his three high-end Chinese restaurants in New York City, two Red Farms and Decoy, co-owner Ed Schoenfeld says at the beginning, when the coronavirus started in China, its business was relatively unaffected. Since these restaurants “had more customers than places to put them, even if we had a downturn, it wouldn’t have showed up in sales,” he says.
Chinatown eateries, Schoenfeld says, encountered more resistance than his three spots, located in the West Village and Upper West side of Manhattan.
Then in mid-March, New York City announced dining-in was prohibited at all restaurants and only take-out and delivery were permitted. “The impact is gigantic,” Schoenfeld says.
Schoenfeld’s three eateries had about 170 employees, and in order to stay in business, he had no choice but to terminate or furlough, nearly all of them, except for skeletal staff to maintain the take-out and delivery service.
“When I finished my last payroll, I noticed there wasn’t much money left in the bank,” he says. Furloughing a manager that he has been close to for 10 years was a very difficult task, he says.
The take-out business has been thriving, but the costs of New York City are so high that they won’t pay all of Schoenfeld’s expenses. Though the average check at Red Farms is about $50 to $60 a person, he’s looking into offering $20 Chinese meals and Peking Duck specials to attract more volume.
Can Red Farms stay in business, pay its bills, and endure this pandemic? “We’ll see,” Schoenfeld says, cautiously optimistic. “That’s what I’m trying to figure out.”
At the 26 Inchin’s Bamboo Garden franchised restaurants, which offer Inchin food, an Indian and Chinese blend of dishes, business didn’t drop off when the coronavirus first struck China, says Megha Agrawal, its Sacramento, California-based director of marketing.
But when the coronavirus spread through the Seattle and Kirkland, Washington area, that’s when business at Inchin’s in Seattle plummeted 50 percent.
When other cities like Philadelphia started prohibited dining in, only permitting take-out and delivery, business kept on plummeting, across the board in all of its locations.
And by mid-March when the pandemic spread, business at Inchin’s is down “90 percent at this point. We are barely hanging on,” Agrawal says.
Of its 26 eateries, three franchisees have opted to close their restaurants. In some cases, staff was reluctant to go to work fearing they would contract the disease. Other franchisees figured that the revenue generated by take-out and delivery would not match their employee costs and preferred to close to save money.
Most of its locations offer third-party delivery but at least that will keep some money coming into the coffers of franchisees.
But take-out and delivery won’t generate considerable income since many locations are frequented by people who live in a 30-mile radius. In most cases, people will drive for take-out in a 5-mile radius, but not 30 miles.
Yet Agrawal thinks pick-up and delivery orders will start increasing in due time when the pandemic slows down nationally. “People haven’t hit their cabin fever point,” she says. In a week or two, when people are going to need to extricate themselves from their homes, they’ll start going out more and ordering food.
Via social media, Inchin’s Bamboo Garden has done everything it can to reassure customers that it’s taking all the proper precautions to keep its food healthy, its employees healthy, and avoid any contaminations.
Once the coronavirus fades, Agrawal expects a natural spike to the economy and a resurgence of dining out. “People will have missed going out. There’ll be a natural pop. I don’t think we’ll have to do much but say ‘We’re open.’”
