Challenges remain as York County businesses move to 'green' phase
Restaurants, bars, salons and shops in York County are slated to switch Friday to the "green" phase of Gov. Tom Wolf's COVID-19 reopening plan, but many will face uncertain financial territory as they adapt to the governor's operating restrictions.
The restaurant industry in particular will have a tough go of it, said Harris Eckstut of Eckstut Consulting, a restaurant industry consulting firm.
"Those people that were struggling before, unless they have some kind of cash backup, they’re not going to make it," he said Wednesday.
Restaurants across the state were prohibited from offering on-site dining for weeks as part of the governor's COVID-19 mitigation strategy, and instead were only allowed to serve take-out and delivery. In recent weeks, a handful of businesses, such as two Round the Clock Diner locations in York County, have defied Wolf's order.
Beginning June 5, restaurants in areas under the yellow phase were allowed to offer outdoor dining.
And restaurants in the green-phase areas can offer both outdoor and indoor dining, but indoor dining must be limited to either 50% capacity or however many people can be seated while keeping tables 6-feet apart in every direction.
The profit margins in a restaurant were already slim, Eckstut said, and limiting the number of potential customers means managers will have to adjust their budgets to make up for the loss.
Another challenge could be paying rent on the restaurant space, Eckstut said.
Landlords usually charge rent based on square-footage. If a restaurant is only able to use 50% of the space, they should try to renegotiate their rent accordingly, he said, but it won't always work.
"Good landlords will cooperate because they understand the world and they want to get paid," Eckstut said. "Other landlords might have their own problems, or they just don’t care. They want their rent."
Aside from decreased capacity inside restaurants, there are other challenges to contend with.
Christian DeLutis is the executive chef at Heritage Hills Golf Resort in Springettsbury Township, which operates the on-site restaurant Avenue Ale House & Pizza Loft.
DeLutis said food shortages have led to sharp spikes in prices, and most restaurants are vying for access to the same limited supply of ingredients.
"Pretty much everything across the board has gone up in costs," he said.
For example, the price of ground beef has increased by 40% to 50% from about $2.50 to $2.70 per pound to about $3.50 to $4.00 per pound, he said.
Pork, eggs and dairy are also more difficult to source, he said.
Food shortages became national news in recent weeks after meat processing plants in states such as Nebraska, South Dakota and Maine shut down because of COVID-19 outbreaks.
When the chefs at Heritage Hills do get their hands on the right ingredients, DeLutis said, the quality is sometimes inconsistent.
Customers have been patient and understanding about the changes, he said, and in the first five days the restaurant offered outdoor dining, more than 3,000 people were served.
"The support from the community has been amazing," DeLutis said.
Jonathan Cerutti, vice president of food and beverage at Heritage Hills, said his staff is fortunate because they have such a large property to accommodate outdoor dining, which will help make up for the reduced capacity inside.
"A lot of these other restaurants, especially the ones in the city, they don’t have that advantage," Cerutti said. "And those are the ones I worry about."
The Left Bank Restaurant & Bar in downtown York is one of those smaller restaurants.
With a capacity to seat about 80 people under regular circumstances, The Left Bank will likely be able to accommodate only 30 to 35 people under the governor's green phase guidelines, said co-owner and chef Sean Arnold.
But Arnold said he's optimistic about the future and excited to get the restaurant back up and running, even if it is on a limited basis.
"We’re really looking at both the health of the customers, the health of the employees and also the health of the restaurant being sustainable," he said.
The Left Bank is undergoing renovations and will likely reopen in July under a limited schedule of three to four days a week, Arnold said.
When that happens, the staff will wear masks and gloves, and tables will be spaced 6-feet apart.
The focus will be on local, sustainable ingredients and on providing the same experience customers were used to before the COVID-19 pandemic, Arnold said.
Dealing with the novel coronavirus has been the most difficult setback of his 23-year career in the food and restaurant industry, he said.
"It will be challenging, but exciting," Arnold said. "We’re ready for it."
Sean E. Flaherty is a professor of economics at Franklin & Marshall College in Lancaster.
Flaherty said restaurants and other businesses with the ability to operate outdoors will likely fare better than those without extra space outside, especially because the public might still be hesitant to spend time in confined indoor spaces with strangers.
"I think people are going to continue to be worried about getting the virus, and of course that will continue even after the green light," he said, referring to the governor's green phase of reopening.
Restaurants with outdoor dining could still incur other costs, Flaherty said, such as the cost to put up tents to shade customers.
As for other sectors, moving activities outdoors won't necessarily be limited to restaurants.
Jim Lewin, co-owner of the York Emporium used book store in York City, said he might move the book shop's Sunday evening jam sessions outside after the sessions get back up and running.
The York Emporium has been doing well, despite the COVID-19 restrictions, Lewin said, but it's still been a challenging time.
"We were closed for 10 weeks, and that was tough," he said.
Lewin said he doesn't anticipate any issues with being able to sustain the business while maintaining social distancing between customers, now that he's been able to reopen the store.
He asks customers to wear masks while they shop, and Lewin said he wears a mask unless he's alone.
"We're not going anywhere," he said. "We're gonna be fine."