How will social distancing impact bars?

Seems like owners have two options. They either follow the rules in place or remain closed. I am not sure what other options they have other than breaking the rules and opening without restriction and taking a chance on losing their license. I know in AZ the Gov. said he would pull their licenses if bars did not listen to the rules. Not sure if that is lip service or will happen.
Will be interesting to see what folks do.
Cheers

 

There are multiple bars open in my state and I assume they are operating at a profit or they would close down. The one I went to a couple weeks ago had the tables and stools all set far apart from one another which is in line with state regulations. The bar I went to was pretty much the polar opposite of the videos of people standing shoulder to shoulder and yelling as seen in videos from other states. There are other bars in my area that have yet to reopen which I take as an indicator they cannot operate at a profit operating at less capacity. I expect a considerable amount of bars and restaurants around the country to never recover from this. Of course it is during this COVID-19 stuff that my local bar has a bunch of Parish and Bissell Brothers on tap which is a rarity down here.

 

Is there any discussion in Georgia about progressing into another phase with relaxed restrictions?

I am in PA and I am in an area where we are in the 'lockdown' phase with is color coded as red. Many of the counties in PA are in the yellow phase. And at some point those counties will transition to the green phase. At this point in time I am uncertain exactly what these color phases mean as regards restrictions for bar operations.

Cheers!

 

Foodservice veteran here. You make money on the shifts when the place is packed. If you have to limit your service by 50%, you're not making money. 50% capacity is a slow night in most places. Obviously has a lot to do with what rent, other overhead, and food/liquor cost is like. But if you are going to go to all the trouble of opening back up and if at most you're just breaking even, even if it's every night, it's not worth it. Results in some goodwill from regulars, and gives staff something to do, but tipped employees won't be making the money they expect, so...

That being said, bars do have a lot of capital tied up in alcohol at any given time, and I could see a lot of folks looking to liquidate (pun intended) that as soon as they can to get some revenue coming in, and then only selling quick turnover items for a bit. I think that you won't see nearly as much in the way of high-end bottles (liquor, beer, or wine) for a bit once they sell out, folks are going to restock things they know will sell quickly. Might be a bump on wine or liquor when some places go out of business and their inventory goes to auction.

 

There is a vast amount of room between making a profit and shutting down entirely. Maybe losing $xxx per day/week/month is better than having zero revenue at all.

Jack, have you seen the required metrics for a county moving to green? The last I knew, even the Governor was dodging that question because there was no set requirement for a county going from yellow to green, though that was days ago.

 

I'm curious at this. If your options are breaking even, while paying your employees, the bank, landlord and suppliers or shutting down and not being able to do any of that, how isn't breaking even the better option?

 

That's a lot of work for the owners to not make any money, breaking even isn't a win in any industry I've ever worked in and if I was consistently just breaking even I would be thinking hard about a new strategy

 

It is kind of a mess down here in Georgia. Technically all bars were supposed to remain closed until 5/14 under an order signed by Governor but some bars never bothered closing down at all and that state wasn't enforcing the executive order so it wasn't really a mandate. The bars that are open now (in my area) all serve at least some kind of food so they are allowed the be open as a "restaurant" and operate under those guidelines despite 90%+ of the business being beer sales. Under the current executive order bars aren't allowed to open until 5/31 but as I said people are either flat out ignoring the executive order or adding food to their menu to classify themselves as a restaurant which are allowed to be open as opposed to places classified as a bar or a nightclub.

Just in case you are curious these are the regulations a "restaurant" must follow:

Allowing only ten patrons per 500 square feet in dining room, waiting area, bar area
No self-service drink, utensil, or condiment stations
Encouraging the use of disposable menus
Discontinuing salad bars and buffets
Thoroughly sanitizing tables and any other commonly used items by guests
Using rolled silverware and no presetting of tables
Limiting parties to no more than six people per table
Encouraging reservation-only
Posting signs at the entrance stating no one is allowed in the restaurant who is exhibiting COVID-19 symptoms or a fever over 100.4
Using contactless pay options when possible
Providing hand sanitizer or additional hand-washing stations for staff and patrons
Not allowing people to congregate in waiting areas
Prioritizing takeout and delivery over dine-in service when possible

Unless the executive order is renewed again essentially all businesses in the state will be allowed to open again on 5/31 which is one of the most aggressive re-opening schedules in the United States along side Texas. The Governor has given no indication that he is going to extend the executive order.

Sure, and I am positive the business owners have factored that into their decision in whether to reopen or not. They certainly know more about their business models than I do.

 

In perpetuity sure. I guess I read this as a short term decision. I’d rather break even for a couple months and then go back to whatever normal is/was. Also just walking away would be incredibly expensive to most business owners.

 

Sure bar tabs are less than a full meal. That is obvious but also pointless. This is not a very good argument for increasing capacity in a bar. While it is true that a bar that operates at 50% is usually a failure, bars and restaurants are not the same business.

• Liquor keeps forever, and even beer and wine can sit around for a good while before it needs to be moved. Produce, meat, bread, most everything in a restaurant has a very limited sell by date.
• The mark-up and margin is very different. A small percentage profit margin on a meal is often enough to keep the business open, as long as there are enough meals. Bars have huge mark-up but are still dealing in in low dollar amounts and require a lot of patrons with relatively small bills.
• Bartenders make dollars in tips. Servers make twenties. You can't expect a bartender to bother if they serve 25 pints and go home with $25 in tips.
• Overhead is huge in the restaurant business. A bar has no kitchen to maintain, no grease trap, no kitchen staff, no exterminator once a month, no twice weekly dumpster. No daily deliveries. Etc. Two people can literally run an entire bar.
• A restaurant with alcohol can make it because of the alcohol and would fail or break even if it were just food service. In fact many restaurants only get by with the liquor sales. That extra $300 to $500 three nights a week is huge for the owner. Bigger tips for staff too. Bars have nothing but alcohol sales to make it work, and must move product or die.

So it is true that if bars must adhere to the guidelines set for restaurants they will be in trouble. But then again bars and restaurants are not the same. I suspect a lot of restaurants will be happy if they can open at reduce capacity while the tavern is shutdown. That's going to increase alcohol sales quite a bit.

This does not mean bars magically get to fool the virus though. It's not selective.

Cheers

 

My thoughts as well.

Not a practical business model but in these crazy, and hopefully transitional, times I would think breaking even is a manageable option to get through this. Certainly not a loss right now, as going into the red would be if you just stayed closed and allowed the bills to keep coming in and that counts for something.

 

I have not seen any concrete discussion here; just red -> yellow -> green. Since I live in a red zone I am familiar with the strict restrictions in that phase.

I read both yesterday's (Thursday) Philadelphia Inquirer and today's and I did not see a single article providing details on what exactly what it would mean to go "green". I have watched the majority of the Cuomo's daily news conferences and I am better educated on what is occurring in New York vs. Pennsylvania. Does Gov. Wolf conduct a daily news conference like Gov. Cuomo?

The reason I asked @traction if there are plans for a phased reopening in Georgia was maybe bars would open now even if they are not making a lot of money since they want folks getting in the practice of coming to their business now with the knowledge that a few weeks from now (or whatever) they will be able to practice their business with lesser restrictions. Have something like 50% occupancy now but enticing folks (and more customers) to return in a few weeks in a more 'open' environment.

Cheers!

 

I suppose it depends how long folks think this will be the functional reality (regardless of whatever rules are in place) but it can't be a very appealing prospect for bar owners

 

The below was posted less than 1 hour ago:

“It is not clear what restrictions, if any, will remain in place in the green phase that Wolf may announce Friday. It is the least-restrictive phase of his color-coded reopening plan. Health officials have said they were working on guidelines for counties in the green phase.”

https://6abc.com/reopening-pennsylvania-pa-philadelphia-green-phase/6202189/

So, it appears that the government is still dithering here?

Cheers!

 

I will not be drinking in bars/taprooms at full capacity right now. I'll stick with curbside for a while longer. It would be great to see some of the places that didn't offer many to go options before continue to include crowler/growler fills once they open back up.

 

Perhaps breaking even isn't the best way to put it.

It's incredibly hard to run any customer service business. It's a work of passion. If you aren't coming out ahead, or don't foresee coming out ahead in the short term, why would you continue to do it if you think it could break you? Why not cut your losses and go back to what you did before all this happened? If you're a lifelong restaurant person, focus on a limited take-out option instead of bring on a 1/2 staff where you have back of the house standing around and front of the house bitching about not getting tips. At least there would finally be something like equality of pay between FOH and BOH.

Especially when you consider the state of restaurants/bars before this all this went down There was a saturated market on places to go out. Break your own back to make it work, when the folks that have big money backers, deep pockets, and access to the best lawyers and accountants can get those PPP loans while you couldn't?

You're treading water waiting for a tsunami nowadays waiting for things to get back to normal. Come fall or winter, we'll be in the same boat as we've been the past few months.
I really hope that everything goes back to the way it was. But I don't see it. We all gotta duck when the shit hits the fan.

 

The obvious solution is for bars to raise prices to accommodate the new business model and make adjustments as things change.

 

Raising bar prices in a bad economy when many people don't even want to go out may not be a winning business model. It may work some places but beer prices at the bar are already considerably higher than bottle shop prices so if people can drink at home for cheaper while and the same time being safer not going to the bar seems like a decision many people would make.

 

You're absolutely right and of course I've considered all that as well but really there's not much else to do. See what the customers are willing pay to drink at a bar. The other attraction of bars is to meet prospective dates. How's that work out with social distancing? Come to think of it bars are loud enough, now people will have to yell their conversations from six feet apart. Why the hell would anyone want to go to a bar?