Restaurant and bar owners flooded the Small Business Administration website last week, trying to apply for grants from a $28.6 billion fund passed in March as part of the $1.9 trillion American Rescue Plan.
There are 500,000 independent restaurants in the U.S. that employ more than 11 million workers, according to the Independent Restaurant Coalition (IRC), a trade group that formed in March 2020 when restaurateurs Tom Colicchio and Camilla Marcus rallied together other high-profile restaurateurs and chefs like Marcus Samuelsson, Kwame Onwuachi, Nick Kokonas, Jose Andres, and Andrew Zimmern.
Zimmern, a James Beard award-winning chef and TV personality best known for his series "Bizarre Foods with Andrew Zimmern" says the allotted grant money is just a “drop in the bucket" as small businesses across the country grapple with gradual re-openings after a devastating year of the coronavirus.
The IRC originally lobbied for a $120 billion relief fund for the independent restaurant industry. Zimmern says that the current fund is "fantastic" but just a start and predicted that many restaurants will close within the next month because they don't qualify for grants and have taken on high debt loads.
"That's really been the sorrowful story of the last 13 months...restaurants have taken on debt, and/or spent every last dime they have," said during Yahoo Finance's All Markets Summit: Small Business Recovery, which aired Thursday. "And so they can't continue any longer unless they get this relief, that $25 billion is going get eaten up, and we need further grant relief from the U.S. government.”
Speaking to Yahoo Finance, Zimmern described the last 15 months as utterly Dickensian for the industry.
“It was the best of times, it was the worst of times...our industry has been the hardest hit of any. We have had to be most resilient. We have been forced to pivot, re-pivot, zig and zag unlike any other industry," he said. "And yet, at the same time, having just visited Atlanta a few weeks ago to see a food hall opening where 18 entrepreneurs all held on to their dream for two years and made it through to see their small business, my heart is warmed.”
The Restaurant Revitalization Fund has put a strong emphasis on prioritizing communities that were disproportionately affected by the pandemic — women and people of color. Larger chain restaurants with over 20 locations and publicly traded eateries are not eligible for grants.
As Zimmern puts it, this ensures that “groups that have been traditionally disenfranchised have the first bite at the financial apple."
Melody Hahm is Yahoo Finance’s West Coast correspondent, covering entrepreneurship, technology and culture. Follow her on Twitter @melodyhahm and on LinkedIn.
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