Restaurants Prepare For "Dramatic Loss Of Revenue" As New Year's Eve Celebrations Are Canceled

As the world bids goodbye to 2020, restaurants and bars will have a nightmarish New Year’s Eve as many shops grapple with indoor seating limits, early curfews, and, in some parts of the U.S., a complete ban on indoor dining.

New Year’s Eve is one of the most profitable nights of the year for restaurants and bars, but this year it will be full of misery industrywide.

“In past years, the run-up to the holidays was the time for everyone in the business to make money to carry us through the lean months of winter,” Kip Michel, general manager of renowned Brooklyn pizza joint Roberta’s, told Bloomberg. “It’s a tough time this year.”

A recent Morning Consult survey found that only 7% of Americans are expected to attend New Year’s Eve celebrations at a restaurant this year. This is more bad news for eateries from New York to Chicago to San Francisco.

“It’s going to be a dramatic loss of revenue,” said Andrew Rigie, executive director of the NYC Hospitality Alliance, a group that represents restaurants and bars in New York. He said the restrictions plus the lack of people attending eateries tonight would hurt businesses and workers, adding, “with employees either out of work or making a fraction of the tips they would normally make.”

The restaurant industry has had one of the most challenging years on record.

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The National Restaurant Association warned earlier this month that more than one hundred thousand restaurants are permanently closed because of virus-related public health restrictions issued by the government.

“This night is normally huge for us because we do a food and drink package and sell out,” said Dusty Carpenter, director of operations and managing partner for Another Round Hospitality Group, which owns D.S. Tequila. For many patrons, New Year’s Eve this year is “an afterthought.”

Restaurants have found creative ways to make money through the pandemic, such as to-go alcohol and food orders, along with outdoor dining.

As Goldman Sachs pointed out in a recent client note, restaurant operators need to take weather into consideration as foot traffic to outdoor dining would plunge when the temperatures dip below 45°F.

While many hope 2021 will usher in a much better year than this – for restaurant operators, the worst has yet to be seen.

Source: Zero Hedge

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