One of the restaurant sector’s brightest lights is striking a cautious tone on how the industry will recover after the coronavirus outbreak.
“It’s going to take all of us a while to get back into the routine of gathering. We will want to do it. But it’s going to take a while,” Union Square Hospitality Group Chairman and CEO Danny Meyer said on Yahoo Finance’s The First Trade. Union Square Hospitality owns and operates a prestigious collection of restaurants including New York City icons Blue Smoke and Gramercy Tavern. It also boasts a sizable catering and events business.
Meyer — a 30-plus year industry veteran known for his optimism, big ideas, role as founder of Shake Shack and a pioneering restaurant business model called enlightened hospitality — is enduring the same challenges as other restaurant chains, large and small, amidst the coronavirus.
All of Meyer’s 19 restaurants in New York City are closed along with ones in Washington, DC. His catering and events businesses have taken financial hits. In mid-March with minimal revenue coming into the business and concerns about worker safety, Meyer was among the first in the space to lay off workers — some 2,000 in total between restaurants and the corporate office.
Meyer is donating his own salary and pay cuts from other company executives to a relief fund he set up for laid-off workers called “HUGS.”
Life after the coronavirus
“So, now, the stimulus package tells us we’ll forgive your loans if you hire everybody back by June. Well, I can pretty much guarantee you that restaurants are not going to be back full force by June. So hopefully, we’ll see somebody come to their senses. And it’s just not realistic for our business,” Meyer said, explaining that he will have to re-recruit workers and re-train them once social distancing restrictions are lifted.
Meyer echoes what others in the restaurant industry have told Yahoo Finance about the restaurant industry looking beyond the coronavirus. Veteran chef and owner of Blue Dragon in Massachusetts Ming Tsai told Yahoo Finance some 50% of U.S. restaurants may not reopen. Ultimately, that would not be good for the U.S. economy or the communities that mom-and-pop restaurants service.
“We need the independent restaurant. We need the neighborhood place. We need Shake Shack and we need the chains way larger than us,” Meyer’s long-time friend and Shake Shack CEO Randy Garutti said this week on The First Trade.
Brian Sozzi is an editor-at-large and co-anchor of The First Trade at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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