Lisa Boorman, owner of Red Door Café
Olga Sagan, owner of Piroshky Piroshky
Since COVID-19 forced many businesses to shut down or scale back operations, restaurants have been particularly hard hit. While certain states are starting to allow dining rooms to reopen after months of restrictions, in many places the future is still uncertain. When restaurants are able to reopen, they’ll likely have to operate at less than full capacity and/or put social distancing procedures in place that might slow down the speed of service.
Forced to adapt, many restaurant owners have pivoted their business to offer new products and services–or even completely revamp their business model–so they can continue to stay afloat while they wait for things to return to normal–or something approximating it. Two of those businesses are Red Door Café in Moses Lake, Washington, and Piroshky Piroshky in Seattle. Recently, the owners of these two restaurants met with Gravity to discuss what they’ve done in their business and offer advice to other restaurant owners looking for ways to adapt.
“We Were About to Die Out”
At Red Door, co-owner Lisa Boorman says sales at their flagship cafe downtown dropped 75% in the weeks following the outbreak of COVID-19. Not only was the cafe forced to stop offering dine-in service, but they lost much of the foot traffic from area workers who stopped showing up to their offices nearby. Since large gatherings were also prohibited, catering orders plummeted. Luckily, business started booming at Red Door’s third location, a drive-thru donut and coffee shop that opened in November. The drive-thru made ordering and pickup easy, and people started buying donuts as gifts, thank-yous, and comfort food. As a result, sales at Red Door Donuts increased by about 75%. “Our business basically flip-flopped,” Lisa says.
Lisa says Red Door customers started asking if there was a way for them to order over the phone or online and pick up food without having to enter the cafe. Lisa discovered that Gravity, their longtime credit card processor, was offering a commission-free online ordering program, so she called to get it set up. Within 48 hours, Lisa says, the menu was up and running, and since they started offering the service, cafe business has recovered by about 10%.
At Piroshky Piroshky, things were even bleaker. A Seattle landmark located in the famed Pike Place Market, the bakery, which sells a variety of Russian pastries and, under normal circumstances, frequently sees lines down the block, lost 90% of their business. Not only did regulations prevent them from operating at full capacity, but tourist traffic to the area disappeared. Owner Olga Sagan says that the bakery has an -commerce platform, but no one was visiting it. “We were about to die out,” she says. “We had to come up with something new.”
Olga acknowledges that many businesses have turned to third-party apps like Uber Eats or Grubhub to offer pickup and delivery services and easily market their restaurants to consumers who are already using those platforms. But for Olga, the cost of using such services isn’t worth it because the commission is so high. “Third party platforms are not an income source but an advertising expense,” she says. “There is no profit in those platforms.”
Olga wanted to offer delivery, but she needed to do it herself. She began talking to other Pike Place restaurant owners and, seeing potential power in numbers, offered to advertise their pickup and delivery services through her own site. She quickly saw the value in this, but decided to start a new website called Catch22Delivery. The site, which is still in beta, aggregates information of area restaurants who are offering takeout and/or delivery and allows customers to order directly through them. In return, the restaurant keeps the vast majority of their revenue and doesn’t have to rely on a third party to communicate with its customer base. The website is still very much a work in progress, but Olga says it’s getting better every day and she’s inspired by customers’ eagerness to support local merchants.
What Can Other Restaurants Do?
Drawing on their own experiences, Lisa and Olga offered other restaurant owners advice on how to approach their businesses during this time. Ultimately, it’s a great time for trial and error because everyone understands that everyone is trying to figure things out. So why not be bold?
- Market directly. Customers want to support their favorite local businesses right now. The problem is that many of the options for them to do so aren’t actually good for businesses. Delivery apps like Uber Eats and Grubhub charge huge fees and take up to 30% commissions on orders, meaning they’re a break-even endeavor at best for merchants. Relying on a third party can also risk your reputation, as customers will often give you a negative review for delays or cold food even if your business wasn’t responsible. Instead, Olga encourages businesses to market directly to their customers, whether through social media, a website, or another service like Catch22. Let them know you’re open and encourage them to order through you. Lisa says offering an online-ordering option, like the one she set up through Gravity, is also a great cost-effective option.
- Focus on what’s working. When Lisa realized business was down at the cafe but up at the donut shop, she decided to put more resources into what was working rather than try to fix what wasn’t. This has also allowed Red Door to keep all of its employees working full time as they’ve started taking on new responsibilities to reflect the needs of the business. Lisa urges owners to look at what’s working and double-down on those efforts. Want to ramp up your to-go business? Turn your dining room into a packaging and pickup station. Want to start a delivery service? Maybe your waitstaff can serve as drivers.
- Listen to feedback. Your customers know what they want, so ask them for feedback on how to improve the business. Is there a service you can offer to provide extra convenience? A menu item that’s in high demand? Check in with your employees as well as they are constantly interacting with customers and can provide insight into what they’re looking for. Lisa says the idea for an online-ordering service came directly from talking to customers who wanted to order from the cafe but didn’t want to have to show up in person to do so. Likewise, Red Door didn’t decide to ramp up their donut service; they simply followed increased demand from customers.
- Revisit your menu. If you need to offer delivery or takeout, create a separate menu to ensure you’re not sending out food that won’t hold up outside the dining room. Customers may think they want what they normally order, but they’ll be disappointed if it arrives cold, soggy, or just generally not up to your normal standards. Depending on your business, this may require you to come up with a completely new menu. For example, Seattle restaurant Canlis is famous for its high-quality tasting menu. But since the shutdown, they’ve started offering family meals and meal kits that they rotate each week. This allows them to continue selling while ensuring the quality of the food that goes out the door.
- Support local vendors. With so many small businesses at risk, customers want to help in any way they can. While sourcing ingredients or products from local, independent suppliers is more expensive, many customers are willing to pay a premium knowing that their money is going back into their communities. Prior to the shutdown, Piroshky Piroshky began sourcing from local vendors like Tillamook cheese and Uli’s Famous Sausage. In addition to offering customers local ingredients, Olga says this decision has helped improve the business’s logistics as they’ve been able to avoid many of the supply and delivery issues other businesses have been experiencing.
- Identify resources. In addition to federal programs like the Paycheck Protection Program or Small Business Administration loans, check with local business or development organizations to see what they’re offering. Lisa says her community newspaper is offering to match advertising dollars, and her local chamber of commerce and downtown associations have marketing programs in place to help area businesses. Lisa also encourages you to talk to other business owners in your area to see how you can help each other, whether it’s through co-marketing, sharing inventory, or offering a co-branded product or service. For example, Lisa is in talks with a few business owners in downtown Moses Lake about hosting a block party to celebrate reopening when the time comes.
- Admit mistakes. Recently Olga’s team oversaw a massive delivery to Bremerton, a city about an hour west of Seattle. After the team arrived on location, they realized they were missing seven items from their menu and had to drive back to Seattle to retrieve them. This meant customers had to wait hours for their food, and they were understandably upset. After they expressed their displeasure, Olga took responsibility but also shared that her team had done the best they could under the circumstances and would try to do better next time. Her vulnerability paid off, and customers immediately started offering words of support. Olga says customers are usually willing to forgive you–especially now–and sometimes sharing your struggles can help create connection and empathy. “If it doesn’t work, own it,” Olga says. “Talk to your customer, move on.”
- Don’t be afraid to quit. While Olga and Lisa are fighting tooth and nail to keep their businesses afloat, they acknowledge that may not be the right decision for everyone. Running a restaurant under even the best conditions is hard, and some owners might simply not have the energy to continue in the face of so much uncertainty. “You have to understand the pain of a business owner,” Olga says. If you’re been working hard for years–maybe decades–and are faced with the prospect of having to start from scratch, it’s completely understandable if that is too much. “It’s okay to close if that’s what’s right for you,” she says. “You will be okay. You will find something else.”
Ultimately, while it’s extremely difficult to be a restaurant owner right now, it can also be an opportunity to breathe new life into your business and try something you’ve never tried before. As Lisa and Olga continually point out, customers want to support you, and many of them are inclined to be more patient and generous than they might have been before. Embrace this new normal, be authentic and vulnerable, and communicate openly and there’s a good chance you’ll get through this crisis stronger than before.
By Brooke Carey, Lead Storyteller
