Now several months deep into the coronavirus outbreak, multi-unit operators find themselves sprinting and pivoting on a daily basis to keep their businesses moving while keeping their employees and customers safe. Many restaurant operators, such as Farmers Restaurant Group, are fundamentally changing their operations or business models by shifting to takeout and delivery only, offering new food and services, and more to weather the storm.
Washington D.C. based Farmers Restaurant Group (FRG) owns and operates eight full-service restaurants across D.C., Maryland, Virginia, and Pennsylvania. The company opened its first restaurant in 2008 to bring the North Dakota Farmers Union’s quality products directly to consumers, and has since opened new concepts, a bakery, and distillery. We spoke with FRG co-founder and co-owner Dan Simons about the impact of the coronavirus on his business over the last few weeks, what decisions and changes the company has had to make – including how to shift to takeout/delivery only – and to share any tips for other operators out there that are looking for answers and inspiration.
Read the questions and Dan’s answers below.
Tell us about yourself, Farmers Restaurant Group and your restaurants
My name is Dan Simons, one of the co-founders and co-owners.
Our company started with the vision of the North Dakota Farmers Union merging with the vision of how my partner Michael V. and I could bring it life in a restaurant. We started with one restaurant in 2008 in Washington DC, and over the past decade grew to locations in DC, MD, VA, and PA, along with our bakery and distillery, Founding Spirits. Pre-covid-19, we had about 1,100 employees serving about 50,000 guests per week. We’ve now lost about 97 percent of the employees and revenues, but we are figuring out how to build it back.
What are some of the biggest changes you’ve made to your day to day operation in the last few weeks because of the coronavirus?
The biggest three changes were losing 97 percent of our staff, and 97 percent of our revenue, and determining we needed to create a new business plan so that we could chart a path forward and find a way to grow and get more of our people back to work so they can earn a living.
We anticipate three phases to this new plan. Phase I is our immediate launch of our Market & Grocery, with over 700 SKUs, which we will offer in addition to our restaurant a la carte menu. Obviously curb-side pickup and delivery only, no shopping inside of the restaurant. Phase II will be adding more SKUs (the goal is 2,000) and improving our e-commerce tech. And, Phase III, which I’m hopeful for but which is completely dependent on the reality of the virus impact and its timeline, will include the ability to start to have both diners, and shoppers, inside of our restaurant/market/grocery. We presume it will begin slowly with social distancing, and eventually get back to normal or a new normal, and we expect to continue aspects of our Market offering forever, along with the “normal” of being a restaurant.
Simultaneously, we have morphed our distillery into making sanitizer, and we will do that as long as society needs the supply, and we’ll continue to mix in production of our award winning spirits, because we know people want to purchase that also.
Did you do takeout and delivery previously? What has been the biggest challenge in shifting to takeout-only?
Yes, we did, but it only represented three to five percent of our business, depending on the location. As a restaurateur, to lose my entire dining room and not have guests and families inside the four walls is an enormous and unsettling change. The biggest challenge has been emotional – the human impact of all the lost jobs is in many cases, heart-breaking. This is our biggest challenge, but also our biggest motivator to find a way to stay in the fight and create new revenue channels.
How are you keeping each store in the loop on what to do, how to do it, etc.?
We are using Zoom video calls intensively, along with Flock, a digital comms tool similar to Slack. Fortunately we have an amazing team of people, and a strong culture, so the commitment to good comms is as prevalent as the commitment to the mission.
How do you ensure that employees and delivery partners are healthy at work? Are there any new policies in place to ensure employees are staying home if they feel ill?
This is a huge priority. Of course anyone who is feeling even remotely unwell stays home, and gets paid to stay home. We are practicing as much “distancing” as we can in the workplace, and while it isn’t perfect, it is atop everyone’s mind. We have always been strong in the areas of food safety and handwashing is part of our culture. Now we have just stepped it up even more intensely with sanitizer dispensers in the restaurant, and frequent sanitizing of all surfaces. We are working on additional protocols as we can get PPE in stock, we will make it available to our staff. We are also ensuring the staff is able to stay distant from customers doing pick-up, and that payment transactions are done mobile, with no signing, no paper.
Do you anticipate any new challenges if you are limited to takeout/delivery for several more weeks or months?
I don’t see this ending within the next few weeks. Cash flow is the biggest concern, second only to concerns about the health and safety of my staff and our customers.
What tips can you share for operators converting to takeout/delivery only?
Continue to focus on food safety, while adding in all the additional virus-related protocols for an essential workplace. Slim down every expense you can imagine, and focus on payroll and cost of goods, every other bill or item on accounts payable is sort of frozen in time for the moment. Maybe most importantly, lead with integrity and a commitment to conscious capitalism. We will get through this, and we want to come out the other side proud of how we treated one another along the way.
What other advice do you have for other restaurant owners and multi-unit operators right now?
Stay committed to conscious capitalism and lead with a balance of head and heart. Don’t panic, don’t get selfish, and don’t be short-sighted. We will come out the other side of this, albeit different than when we went in. When we do come out we need our character, our principles, and our relationships to be what gets us through it. Operators in our industry are tenacious—take that fire and that drive that got you into the biz in the first place and turn your attention to pivoting, to morphing, to adapting…do it safely, do it to serve and to solve and to help, and we’ll get to the other side of this…I know there will be devastating stories of heartache, and there already are, but that should only motivate us more to mitigate what we can, and forge ahead.
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