PPP replenishing, Chicago capping, Trump kneecapping, Hamilton reflecting, and more...
Family Meal - Friday, April 24th, 2020
First things first, I have a piece in Eater this week about what it’s like to dine out in Hong Kong, where restaurants are open and people are… dining out. They asked for a customer’s perspective, so it’s not exactly a list of all the things groups are doing back of house or anything, but hopefully a helpful look into where guests need to be coddled a bit, and what not to worry so much about in the (hopefully near) future. Please, read, share, and criticize openly, using the hashtag: #WowThisGuyIsBrilliantWeShouldSubscribeToHisNewsletter.
And if reading’s not your thing, I called Amanda Kludt and Daniel Geneen from a restaurant here last night, and talked to them for the Eater Digest podcast which should come out later this morning. I haven’t heard the recording yet, but was feeling pretty confident with that margarita in my hand, so… recommend.
Let’s get to it…
The Relief – If all goes well, the PPP program that ran out last week will get a small refill soon, with at least a little better language to help target the money this time. Per Emily Cochrane and Jim Tankersley in the NYT, the new measure “would provide $320 billion for the small-business loan program, with $60 billion set aside for smaller lending institutions, in line with Democrats’ request to steer resources to businesses that typically have trouble getting loans.” So, JP Morgan will have to stick to a meager $260B piece of the pie, but still nothing specifically for restaurants, and still no guarantee everything won’t go sideways again. We shall see. (And by that I mean, we shall see everything go sideways again.)
The Refunds – After Shake Shack returned its $10M in forgivable PPP loans earlier this week, a number of big companies are following suit. The WSJ’s Peter Rudegeair, Heather Haddon, and Ruth Simon report, “Ruth’s Hospitality Group Inc., the owner of the Ruth’s Chris Steak House chain, said Thursday it would refund $20 million.” Eater LA’s Matthew Kang says, “Kura Revolving Sushi Bar, the 25-location restaurant chain based in Irvine, has decided to return the $6 million Paycheck Protection Program (PPP) loan it had received as a part of the federal CARES Act.” And, in a Medium post yesterday, the Sweetgreen founders wrote, “At the end of last week, we were approved for a $10M loan through the program. That same day, we learned that the money had run out and so many small businesses and friends in the industry who needed it most did not receive any funds. Knowing that, we quickly made the decision to return the loan.”
But before your cold hearts begin to melt in the warm waters of ostensible altruism, note this news yesterday from Bryan Pietsch in Business Insider: “The Treasury Department is asking publicly traded companies who received loans from a fund intended to help small business recover from the pandemic to return the money by May 7 or face consequences, according to new guidance issued on Thursday. The department said it was ‘unlikely that a public company with substantial market value and access to capital markets’ could prove that a federal loan was necessary for it to stay afloat.”
NB: If you click through to the Treasury guidance, the relevant FAQ is number 31 all the way down at the end of the doc. The answer uses the phrase “good faith” a lot, which I guess makes the PPP an honor system? Neat thing about honor systems: Dishonest people often don’t face consequences until the system is ruined for everyone…
The Cap – “Chicago’s City Council is considering an ordinance that would cap the fees that third-party delivery services, like Grubhub and DoorDash, charge restaurants. For the last two weeks, Mayor Lori Lightfoot’s staff has met with the Illinois Restaurant Association (and their counterparts in San Francisco), wanting to emulate an emergency executive order adopted earlier this month in the Bay Area.” Per the full story from Eater Chicago’s Ashok Selvam, while SF set their cap at 15%, Chicago is looking at max fees of five percent! That’s a heckuva benchmark for other cities eyeing similar legislation…
The Kneecap – With Georgia set to reopen restaurants and bars on Monday, a Mr. Donald J. Trump gave everyone wanting to stay closed some serious conservative cover yesterday. Quoted by Alan Judd in the Atlanta Journal-Constitution, Trump said that when he last spoke with Governor Brian Kemp, “I told him very distinctly, ‘You do what you think is best,’… But if you ask me if I’m happy about it, I’m not happy about it, and I’m not happy about Brian Kemp.” Something tells me Brian Kemp is not happy about Brian Kemp right now either.
The Apps – Expedite’s Kristen Hawley has an Eater update on what reservations apps are doing to stay afloat these days. Some sample numbers via Mr. Numbers: “[Nick Kokonas] says that Tock currently supports close to 400 restaurants offering takeout… One month in, the company already processes nearly $1 million in to-go sales per day. On one weekday earlier this month, restaurants on the platform sold 11,700 orders for nearly 40,000 meals.”
The Essay – “On the night before I laid off all 30 of my employees, I dreamed that my two children had perished, buried alive in dirt, while I dug in the wrong place, just five feet away from where they were actually smothered. I turned and spotted the royal blue heel of my youngest’s socked foot poking out of the black soil only after it was too late.” So begins Gabrielle Hamilton’s long NYT Magazine essay on closing her restaurant, Prune, in Manhattan. Honestly, I haven’t had enough time to re-read this and pull out all the parts yet, but everyone’s reading it, so… join the club!
I will say: It’s a beautifully written piece, and will hit close to home for many. One restaurateur I asked for comment on it wrote back, “I cried, honestly.”
But, amid the gorgeous language and real emotion, there are a lot of little nuggets to unpack. Hamilton says she has too much pride herself to let her staff start a gofundme themselves. She takes a swipe at the notion that Momofuku started a restaurant revolution Prune predated. She laments all the ways her life is hard (having to clean the restaurant herself, not having health insurance for her or her wife!), but seems to gloss over the many opportunities she must’ve been given to make enough money to rectify those situations.
And then there’s this callback to the Spotted Pig fiasco from writer Charlotte Druckman on Twitter: “It's just unfortunate that someone, regardless or BECAUSE of her literary talent, who was willing to sell out her industry (or the women in it) to act on her own behalf (or that of her abusive male ‘friend’), should now be held up as the restaurant world's face of martyrdom.”
Like I said, I still need to re-read. Meantime… Penny for your thoughts, folks!
And that’s it for today! After testing the waters out and about this week, I’m staying in tonight. Maybe I’ll listen to a podcast. Who knows.
I’ll see you here Tuesday for next Family Meal.
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