SPRINGFIELD – In the third week since Illinois’ governor banned going out to bars and dining out, restaurants are in limbo as they scramble to get by on takeout and curbside delivery orders, while they wait for relief from the government.
Due to overlapping problems related to the COVID-19 crisis, Renatta Frazier was faced with the difficult decision to temporarily close her restaurant, Greathouse BBQ on the west side of Springfield. She still manages to serve a free lunch to 40 children a day through the drive-up window.
Frazier and her family opened Greathouse just five months ago, which hasn’t given them enough time to establish a safety net. She is worried about how long the stay-at-home order, which was extended through April 30, will last.
“If the closure extends… and they have not completed the work for grants they are telling us will be available, our restaurant will definitely be in trouble,” said Frazier.
Frazier said she’s behind on bills and wants to help her employees who don’t qualify for unemployment.
According to a study conducted by JP Morgan and Chase, small businesses, especially restaurants, can usually only survive about 27 days with no income. April 1 marks 16 days since Illinois’ closure of bars and dine-in restaurants took effect.
Mark Forinash, owner of Café Moxo located in downtown Springfield, had to lay off some employees. He said the job is labor intensive, and he needs his employees back.
“We don’t have the opportunity to work from home. We don’t have the opportunity to automate anything” he said. “We still do everything by scratch and by hand.”
Also located downtown Springfield is Arlington’s Restaurant – a venue that hosts weddings, rehearsal dinners, and other events. So far, 52 events have been cancelled or rescheduled at the restaurant.
Owner Ebben Moore said he is losing money, but he is using the extra time to fix up the venue.
“We get the bonus of being able to do some remodeling, and do some spring cleaning.” Moore said. “We are really hoping to drum up enough business even if we could just break even.”
Moore doesn’t expect to re-open soon, and he said the health of his employees and customers are more important than being open.
“I’m a huge fan of social distancing, and I’d rather stay closed for longer, and have it be safe to open rather than open early and have to close again because there’s an error in judgment,” he said.
Some restaurant owners are taking innovative approaches to cope with the new normal.
Brent Schwoerer, owner of Engrained Brewery, opened an online market where he sells cheese, bread, eggs and prepared meals. He also joined his neighbor, Springhill Suites Hotel, in a deal that allows customers to order food from Engrained and then rent a room at a reduced price.
Schwoerer said the online market accounted for 30% of sales, but he still finds himself in a tough position.
“As the small business owner, I’m busting my butt, just so I could lose money every day,” he said.
Schwoerer said he believes the government will support small businesses, but like all the other owners, he questions how quickly bureaucrats will approve loans and distribute money.
Sam Toia, president of the Illinois Restaurant Association, said loans could hit bank accounts of eligible business owners as early as next week. This raises the question: Who’s eligible?
“You have to be a small business that lost 25%or more of your business, and you have 500 or less employees per entity,” Toia said.
The money comes from the Payment Protection Program – part of the new $2 trillion federal stimulus package. It provides guaranteed loans for small businesses and nonprofits affected by closures and other policies enacted to respond to the COVID-19 pandemic.
The goal is to keep workers with their company, and off unemployment assistance. The measure should assist small businesses for the next 8 to 10 weeks.
“We are encouraging people to get with their bankers, and understand that they can get their annual average monthly payroll times 2.5 to pay their team members payroll, and to pay mortgage or rent, and utilities,” Toia explains.
There are over 800 participating banks that will distribute the loans. After recipients verify they used the money to pay bills and employees, the loan turns into a grant, and will be forgiven.
Forinash, who runs Cafe Moxo, said there will still be long term consequences, even after relief from the government.
“We’re going to have to come back slowly and surely because you never know what’s going to happen around the corner,” he said. “We’re really going to have to get our feet back off the ice before I start to take any risks, or try to grow my business.”
If you are involved in the restaurant or hospitality business, and need guidance, resources are available at the Illinois Restauration Associates website.