PUBLISHED APRIL 22, 2020
April 12, 2020
It's Easter Sunday. The day our so-called president said we'd be getting back to normal. What a joke. We knew better. Normal is nowhere on the horizon. It's been about five weeks since the virus showed up on our continent. And nearly a month since restaurants were sidelined to carryout and delivery only.
I'm pleased to report that we're hanging in there. Through a combination of luck, marketing genius and sheer stubbornness, two out of our three locations are surviving. Detroit Street is doing sales that are pretty consistent with last year's at this time. The Bakery/Cafe is at about 60% of normal sales, but their staff is tiny. There are two people making and selling about $2700 in food per week. And two bakers (1.5 FTEs) cranking out enough bread and desserts to supply both locations. The interesting thing about Detroit Street is that labor, as a percentage of sales, is way down.The good news is: efficiency is up and payroll is down. The bad news is: fewer people are working.
I've been thinking about the meaning of an economic engine. Using the restaurant as an example, we hire people to make and serve the food and wash dishes. Customers enjoy a night out and spend their money. We use that money to pay our staff and our suppliers. It's simple money-in, money-out. When customers stop coming, the engine slows or stops. Employees stop making money. They have no money to spend and nothing to do. Distributors suffer losses. Our produce distributor, Frog Holler, which caters mainly to restaurants, is down to a skeleton crew and has reduced hours from 6 days a week to 5 days a week. Our tofu maker, Michigan Soy Products, has shut down due to a lack of supplies. Some of their suppliers have shut down. We are saving money by buying less. We have stopped our linen service to save money. Sohn Linen suffers as a result. A nearby market has sold off one of their two delivery vehicles -- the one they used to deliver to restaurants. The restaurants have closed and many say they will not re-open. The chain just continues. This economic engine sustains our society. It gives people work/purpose -- and money to spend. And everything is connected. I wonder about how it will all come back to life, and if it will all come back to life.
I can measure the degree to which people are hurting by the amount of free food we are giving away. At first we were giving away about $200/day. Now it's more like $500/day. And we have a "hardship fund" in an envelope by the door. Staff is empowered to give it away as they see fit. The envelope can empty in the blink of an eye. I suppose a silver lining is that more people than ever are eating vegan food (hah!).
Most of my staff is now collecting unemployment. And I just gave everyone the remainder of their paid time off. Payday is Friday. If payday were today, I'd have negative money in the bank. But I'm counting on weekend sales to get us back in the black.
The CARES Act was heralded as this great stimulus package to save the economy. I seriously doubt that. Yes, most people will get their $1200 check (or whatever it is). Some people need it and some people don't. Why is everyone getting it? Why not concentrate it in the hands of people who NEED to spend it? Another big chunk goes to the airlines. The remainder goes to small business. But I doubt it will save mainstreets throughout America. My own experience with it: I applied for a $20k loan. I'm afraid to apply for more because the last thing I want is to come out of this thing saddled with debt. Debt is its own form of hell. Much of my loan will not be forgiven, according to the rules. The percentage of loan forgiven is dependent on payroll as of June being the same as payroll before the virus. Well, there's slim chances of that. My staff is down to about 40% of what it was. If things are still the same in June, that means that $8k of the $20k has the possibility of being forgiven and I'm left holding the bag for $12k.
I believe that my business' finances right now are better than most. I'm making payroll and paying all our federal payroll taxes. I paid the one rent ($8k) that I couldn't get out of. All of our vendors are paid to date. I made partial payments towards the state sales and withholding tax and health insurance premiums. I still owe them a combined $20k, but that's what the loan is for.
Personnel update: Our staffing is fairly steady, with some changes. One more front of house member dropped out. She lives in Ypsi, has no car, and is afraid to take the bus. My son returned from Colorado and is back working at Detroit Street, which is a silver lining. Crystal, a rock-steady front of house member, has one year sober today. That is really fantastic. Our kitchen crew is doing well -- except R. He came back a couple of times but has been unable to make it through a shift. He admitted last night he is still using. And now, hopefully, he will get into treatment somewhere.
Personally, I'm ok. Overworked for sure and stressed out. Last night was the first good night of sleep I got in weeks. It really helps. I'm still finding it challenging to concentrate. I'm used to my brain working at a certain level, and now it operates at a lower level. I still force a daily brainstorm (online grocery store, care packages, free food to unemployed people, Easter dinners, etc). Mainly I jump from one thing to the next and forget what I originally set out to do. I write things down and lose my list. I try to spend time with people -- staff and guests. And balance that with administrative and marketing tasks.
I often get up early to cram in an uninterrupted hour before going to the restaurant to ... update the online menu, help the cooks track down ingredients, pick up baked goods from The Lunch Room Bakery for Detroit Street, take inventory at The Lunch Room to see what's left to raid, check in with a struggling staff member, remind everyone to take their temperatures and wash their hands, write a check for a delivery driver, restock our online grocery store, tend to plants, return messages and phone calls, do books, go to the bank for cash so I can cash employees’ paychecks, re-update the online store, take pictures and do marketing for special items, chop vegetables, help on the cooking line, play social worker, drive deliveries, make the schedule, remember to drink water...
April 13
Today we were able to make use of a customer’s $200 donation by delivering lunch to nurses at the U-M Mott Hospital. Our customer-funded free food program in general has made it possible to give food to: our furloughed staff and their families, unemployed service workers, clients and staff from Dawn Farm Addiction Treatment Center, a growing number of homeless people, and anyone else in need.
Since March 19 (26 days ago) we have given out over $7,000 of free food. Additionally, we have paid out $5754 to staff members in paid time off. And our community has purchased over $20,000 in gift cards.
April 14
And now… another relapse of a staff member who has been instrumental to our operation. Forty hours a week he gives his all, always with a kind word and a smile on his face. We are all waiting, watching, hoping for his return so we can shower him with love and support and help him get through this period. Treatment centers are not accepting patients these days. It is all up to him… and us.
And a couple of pieces of good news:
I visited our tiny crew at The Lunch Room Bakery & Cafe today. There are two cafe staffers, a bakery manager, and a bread baker who comes in at night. The Cafe workers -- Kathryn & Dillon -- make food for 50-100 individuals daily, mostly workers at the VA Hospital across the street. They also help the bakers. Our Bakery Manager Angie coordinates daily production and distribution of bread and baked goods to the Cafe & to Detroit Street, PLUS she makes and delivers special-order birthday cakes. Avery, the night baker, produces enough bread and buns to supply both locations PLUS the growing loaf-of-bread sales from the Detroit Street online grocery store. And they do it all with the utmost diligence and care for health standards.
The other good news: we received an email from a guest that made us reflect on why we do what we do, and what has allowed us to continue operating today:
“You probably know my wife and me from our visits to your restaurants. During this time of crisis, we both got your email and without talking to each other, we purchased something like $550 in gift cards between the two of us.
The Lunch Room has been an important part of our relationship, especially when I lived on the west coast and she in Ann Arbor. When I used to visit her, I’d fly to Detroit and meet her at The Lunch Room, sometimes almost every weekend. We’d try to sit by the bar, enjoying each other after a week or 2 or 3 of not seeing each other. Half our nights in A2, we’d either eat at TLR or take out from you and eat at home. I think over an 18 month period we ate at TLR or DFS at least 4-5 times a week, sometimes for lunch and dinner - and if we woke up early and were motivated, for a wonderful music filled brunch. Outside of our homes, we have probably spent as much time together at your restaurants as we have anywhere else.
At some point, in a couple of years, my wife will almost certainly defend her PhD and we’d very much like to celebrate that milestone at one of your restaurants. If you find yourself $1000 short for payroll or anything else and need the help, I’m happy to take the risk and put money down on an unknown date 2 years from now.
We love your mission, we are both vegan, and we have lived some very important moments of our relationship with you - we’d love to see you survive and thrive well into the future.”
Saturday April 18
Two days ago we received notice that our PPP loan did not get funded. It didn’t even make it into the queue. The message we received from the bank said that “hundreds of thousands” of small business loan applications did not get funded because funds ran out. Where did the money go? Airlines, hotel and restaurant chains, where else? I don’t know of a single small business that received funding, and it seems that everyone applied. I first learned the details of the program on Wednesday April 1. The process opened two days later. I submitted my application the very next day … Saturday April 4.
To be honest, I anticipated this would happen. Call it skepticism, but the Trump Administration doesn’t exactly inspire confidence that ordinary people will be prioritized. The good part is that I was not relying on the $20,000 loan for my business’ survival. (I could have applied for much more, but didn’t want to face future debt). But many small businesses were counting on the loan for their survival. This loan program was heralded as the help that mom & pop shops needed to survive this period. It was both financial and psychological salvation. And it hasn’t worked out that way. It breaks my heart to think that so many people (not unlike myself) have given their all to their business. And now they are watching it sink.
I posted our rejection letter on social media and that post generated a lot of response. Probably a dozen other businesses shared that they had also been rejected. People voiced anger and support. It was really gratifying to hear people’s genuine concern for our restaurants. They asked how they can support us and suggested a gofundme page.
The truth is, I’ve always seen myself -- and this business -- as a community resource. We have space and personnel and food and generosity. Over the years, we’ve made a point of compensating our staff well AND donating money to nonprofits ($31,000 to date). And we pride ourselves on the fact that we continue to take care of people. The amount of free food we are giving away at present continues to increase. We have an envelope of cash (our “hardship fund”) by the front door that staff has the discretion to distribute to those who need it. So to think of ourselves as being on the “needy” end is a huge about-face.
Yes, in some ways we are a little needy. We can’t pay all of our bills. We owe money to Blue Care Network and to the state. But payroll is met, and all of our small vendors have been paid. Sales are brisk, especially at Detroit Street Filling Station. The money that people have donated to us has been used to feed those who need it.
We had a kitchen managers meeting yesterday to solidify our systems during this period. We’ve been operating in a way that has “one foot in, one foot out.” Our blended staff and menu (Lunch Room/Detroit Street) have been regarded as temporary. Well, yesterday we made the decision to think of it as permanent. This is where we are and we need to dig in. Get everyone up to speed. Uphold standards. Regardless of the ever-changing word about when/how things will open back up, we are making our own plans. We will be the best, most efficient, highest-quality take-out operation we can be.
The question on my mind today is: Where is the leadership?
We are sorely lacking on all levels of government. How are our elected representatives helping us deal with this crisis? Who’s helping people handle the uncertainty? Where is the humanity? People are scared, anxious, sick & hurting. I want some compassion from our leaders -- all of them. Start a conversation on all levels. Check in with people. What do we need to cope? What is this all going to look like when we emerge? How can people get the help that they need?
Tuesday April 21
Sales are surprisingly strong at Detroit Street Filling Station. Both Sunday and Monday this week were about 50% higher than they were the week before. And last week was among our top ten ever. This is partly due to the fact that The Lunch Room is closed. Detroit Street is now pulling from The Lunch Room’s customer base, as well as its own. Detroit Street is also now open 7 days a week, compared to 6 days pre-crisis. And, sadly, there are fewer restaurants open by the week. For instance, we noticed that No Thai (across the street from us) closed a week ago -- prior to that, we could see their delivery vehicles buzzing around. Plus, our carryout/delivery operation is going well. Staff is on their game. Food comes out fast and delicious. Service is top-notch. Everyone cares.
A note about restaurants in our city: I want them all to succeed. Our downtown is the vibrant center it is, because of the host of locally-owned small businesses. If the restaurants don’t come back, what will take their place? Will their vacancies be filled by chains? Will we look like a freeway exit? I have spoken to the mayor about this and will lend help however I can.
I continue to be grateful for every day: for waking up healthy, for our staff coming to work healthy, for continued good business, for our equipment working (knock on wood), for our customer base continuing to be here for us with patronage, kind words, and generosity. I’m grateful that the food orders continue to come in, people continue to drive up to get their food, and that our delivery drivers are kept busy.
Life these days is a balancing act. On the one hand, my head is in the business. Every day I think about how to keep this machine going. I dream up ideas and share them with Andrew Brown (who in a not-virus world is our events manager and lead musician). Andrew makes a graphic or collects photos and works his magic on our social media sites. For instance, this week’s campaigns are: “like” us on instagram and get entered in a contest to win a giant roll of toilet paper; DONUTS (enough said); and the release of more of our recipes. Past campaigns include: grocery store, birthday cakes, “share the love” tipping, free meals to those who need it, various types of food porn, bicycle delivery, gift cards, Easter dinner, care packages, and many more. It is an effort to remain relevant and interesting and to engage our base… which translates into sales and betters the chances that we will survive as a business and an economic and social engine.
Then I come home and read The New York Times and my head goes into the virus-drenched real world. The worries start. What if, what if? Are we doing enough? Presently I’m trying to track down enough masks for every employee who wants to wear one… or for when/if it becomes a requirement. We have an employee health log; every day when an employee arrives they take their temperature and answer several questions and record their information. So far, so good. But the worry is still there.
I’m also concerned about what happens when social distancing restrictions are relaxed. On the one hand, this is a tough time for so many people who are stuck in their homes, especially those without a paycheck or with difficult family relationships. They need to get out, to get back to their lives. On the other hand, a premature decision to re-open and subsequent second virus spike, would be probably more devastating than anything yet seen. I have a concern about re-opening a dining room with fewer tables. For us, to keep tables 6-feet apart would mean losing about ¾ of our seating capacity. How would 25% seating help us? Would it be worth risking the health of our servers? It may make more sense to continue our current carryout/delivery model than to operate with just a few tables.
And an update on substance abuse-related relapses among our personnel: we currently have three staff members out, due to relapse. One, the previously mentioned kitchen manager R (relapsed about a month ago), is at home, trying to stay clean, and awaiting an opening at a treatment center. The other staff member, who I mentioned in my April 14 entry, ended up in the hospital and is now doing better. We expect him to return to work this week. And yesterday we experienced another relapse. This young man had worked every position-- cook, dishwasher, front of house, delivery driver. He showed up at the restaurant high yesterday and two of our other employees-in-recovery handled him, guided him away, and helped him find a place to stay for the night. It’s hard to watch someone you care about go through this. They become a different person in front of your eyes. Compassion quickly turns to anger and hurt and sadness. There is really nowhere for him to go. I can’t have him at work. The detox and treatment centers are closed to newcomers, to protect the health of current residents. I have no answers to this one.
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Go to the Detroit Street Dispatch to read more.