Lee Anne Wong: What it’s Like to Close a Restaurant During the COVID-19 Pandemic
“We’re closing down now so we don’t end up closing down for good.”
Photo: Courtesy of bravo tv
Lee Anne Wong, executive chef and co-owner of Koko Head Café on O‘ahu and executive chef of Pioneer Inn on Maui, made the decision to close both restaurants temporarily. Here’s how she made the decision.
We’re just trying to make the best business decision possible right now, what’s best in the long run. At Koko Head Café, we’ve been burning $1,000 a day to stay open. As much as I want to stay open for the sake of my employees, we can continue to spend $1,000 a day, or we can take those thousands of dollars and spend them on another month of health care for our employees, everybody that we still have on payroll and everybody that we let go.
When we tried takeout, we averaged about $1,500 in sales a day and it costs us somewhere around $2,500 a day to operate. Before all this, we averaged anywhere between $7,000 to $10,000 a day. You’re basically operating at an 80% loss. That’s what most businesses are operating at with a takeout/delivery scenario. All the gift cards in the world aren’t going to sustain a business indefinitely.
And at the end of the day, we’re going to need startup capital to get open again. A great bill was announced a few days ago where the federal government will cover your payroll and additional employee benefits, etc. But you don’t know when you’re going to see that money. And it’s a very gray area for businesses that have already closed down and let their employees go, whether or not they can benefit from this stimulus package. And it’s not just us, it’s literally tens of thousands, if not more, businesses across the country.
We’re closing down now so we don’t end up closing down for good. We are going to continue to sell gift certificates online; we’ll still crowdfund for our staff.
Right now, I’m making the decision for what’s safest for my staff and my employees. As you see cases of COVID-19 proliferate, especially on O‘ahu, where it’s a much more dense population, I’m aware that every time our employees go to work, we’re putting them at risk. So I’m telling them that it’s OK to stay home. I know everybody’s worried about their finances, but after Floyd Cardoz’s passing a few days ago, it really hit home for me. Floyd was someone I’ve known for 20 years—an incredible chef and amazing human being. He was one of us—it can happen to anybody. After dealing with so many different emotions in the past week, his passing made me step back and take a breath and figure out what’s really important: preserving our business so we can open in the future and obviously giving my staff the time that they need to be with their families and their loved ones and stay safe and healthy. I think that’s the best thing we can do. And it’s the same story that everybody else is going through.
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I don’t expect we will get any kind of rent abatement or forgiveness from our landlord. But landlords such as Howard Hughes and Kamehameha Schools: “What are you doing to help the problem?”* It doesn’t do a landlord any good to put their tenant out of business.
It’s gotta be one for all, all for one, the whole community participating. It’s the same thing as how we can’t shut the state down without the cooperation of the tourism board and the airlines and the hotels—small businesses need everybody’s help, including the landlords. It’s going to take a lot from everybody, not just the federal government but everybody participating along the chain. They have to look at their tenant compassionately: How long has my tenant been with me? What level of success were they at before COVID-19?
As a landlord, ask “am I in a position to offer rent forgiveness or rent abatement?”
I have to believe that they’re going to do the right thing.
It’s just a huge, huge rock to get out from under and the craziest part is nobody did anything wrong. Restaurants and bars closed down to do our moral and civic duty, and play our part and do what’s best for our state and our country. And now, what’s left?
Everybody in the state is doing their best to support small businesses and ordering takeout when they can but I think what you’re going to see as this drags on, people are going to order less and less takeout as they start to think, I need to conserve my money. When is this going to end?
It’s a difficult time for everyone, but it is definitely strange for me as Top Chef All Stars is airing. At a time when we are supposed to be celebrating and promoting the show, I’m in tears one minute on social media and then the next post I’m supposed to say “stay tuned,” though I’m pretty sure I don’t have to worry as most of America is forming a new long term relationship with their television these days. In hindsight, I’m glad the show can give people a little break from reality, as we see many people, chefs and amateurs alike, getting busy in their home kitchens now that we all have to stay at home.
One last thing, I’d just like to express my deepest thanks to all of the brave and dedicated medical and health professionals who are risking their lives to face this pandemic head on. In the midst of all of this chaos, it’s important to remember that there are still so many people fighting this virus on the front lines, sacrificing their safety, putting their loved ones and families at risk. It puts a lot of things in perspective. Do what you can to support small businesses, but don’t forget to take care of those who are working overtime to protect and heal our communities.
* Kamehameha Schools is not Koko Head Café’s landlord, but Darren Pai, spokesperson for Kamehameha Schools says, “To help ease some of the financial pressure, we’ve initiated a formal rent-deferral program available to all retail tenants with an automatic prequalification for those we believe are in retail sectors that have suffered the most in sales. Others can apply into the program and request relief if they have suffered similarly. We recognize the challenging and unknown business climate that owners are facing, and we will reassess and adjust the program if the situation changes.”
Howard Hughes did not respond to a request for comment in time for publication. We will update this story when we receive a response.