The idea is to support food service businesses that are still grappling with the economic impacts of the pandemic. That money can be used to cover expenses such as payroll, rent and utility as well as equipment costs.
Restaurants and bars are still grappling with a drop in sales last year as many had to alter their operations amid state restrictions and pandemic conditions.
In addition to that, some have seen an increase in labor costs in order to attract and retain employees as many businesses in the country are having trouble filling positions.
Local award amounts from the federal relief program ranged from as high as $609,111 to as low as $21,096 with those businesses having two years to spend that money.
Investing in employees
Young’s Jersey Dairy received the most out of those 21 Clark County businesses to be awarded money from the Restaurant Revitalization Fund, according to data released this month.
Credit: Bill Lackey
Credit: Bill Lackey
A lot of that money, which totals at approximately $609,111, will go towards payroll expenses and other employee costs, said Young’s CEO Dan Young.
Money not used to offset the costs of payroll and benefits will be used towards personal protective equipment and other supplies to ensure cleanliness and safety. It will also be used to counter balance rising food costs.
The dairy recently increased its starting pay from $9.30 an hour to $10.50 an hour. Overall, employees across the pay scale saw their base pay increase by a little over a dollar.
Young said that his family’s business currently staffs about 275 people.
“The (federal) money made us feel confident that we could do that,” Young said in terms of raising base pay for employees.
The relief money also allowed for other businesses in the area to increase their pay.
That was the case for Dan Freeman, who owns several restaurants in downtown Springfield with his wife Lisa.
They received $63,594 to be used for their European bakery Le Torte Dolci on North Fountain Avenue and Salato Deli located next door.
The majority of the money will go towards payroll as they have increased their starting pay by 10%.
The bakery and the deli have a total staff of 16 people.
The couple is also in the process of hiring to replace some employees who are leaving.
Dan Freeman said they are also looking to add employees as well.
He said the increase in starting pay was important in order to retain staff as well as attract new employees given the current labor market.
“(The relief money) gave us a level of comfort to do these things with lower risk. It made us feel more comfortable in investing our own money into things such as purchasing equipment,” he said.
Overall, there was a 20% decrease in sales in 2020 when compared to the previous year. But, business has picked up this year, Freeman said.
Freeman noted that the deli and bakery would have survived without money from the Small Business Administration. But he said he his is grateful for the assistance since it allows them to take on more staff and focus on other expenses.
For Young’s Jersey Dairy, its CEO estimated that they spend an additional $1,000 per weekday due to the pay increase. That number is more during the weekends, he added.
The dairy mostly employees part-time high school and college students. The business also offers full-time positions.
The business went from more than 300 people before the pandemic to as low as about 160 people last year as they initially saw a 80% drop in sales.
However, sales have increased and are now comparable to what the business saw several years ago, Young said. But, supply costs such as gloves, as well as the price of bacon and chicken meat for its food service operation have increased greatly.
“We spent a lot of time sourcing things that we use to take for granted. Prices have gone up for things like bacon. It is up by 50% and the type of chickens we sell in our restaurant is up by 30%,” Young said.
He noted that the business is recovering though and the relief money adds a level of comfort as they make some changes, such as the pay increase.
Credit: Bill Lackey
Credit: Bill Lackey
Help during a transition
For Margaret Mattox, money received from the Restaurant Revitalization Fund will go towards sustaining a catering business, which she co-owns with her brother Doug McGregor, after they closed their restaurant in downtown Springfield last May.
Seasons Bistro & Grille LLC received the second largest portion of that money in Clark County and was awarded $437,803. Mattox has described it as a huge help as Seasons adjusts to its new business model.
“It gives us options moving forward,” she said.
Credit: Bill Lackey
Credit: Bill Lackey
The restaurant previously located on South Limestone Street shuttered its doors early on in the pandemic as its owners felt it was no longer sustainable as the state put a temporary ban on indoor dining.
Mattox said that their restaurant model required a lot of labor, perishable foods and an extensive inventory.
The brother-sister team decided to relocate to a smaller space, by moving their operation into the Bushnell Building, and focus on catering.
Mattox said they are still figuring out how the money that was recently awarded to them will be spent .
She said closing the restaurant and the transition that followed proved to be an expensive endeavor.
However, relief money will most likely go towards offsetting costs related to rehiring some former staff members as well as efforts geared towards building the business back up.
Before the pandemic, the restaurant employed up to 15 people, the majority being part time. Mattox said they have been able to rehire two.
Money could also go towards supplies and equipment needed for the catering businesses and its curbside pick-up services.
It could also be used to cover some rent and utility costs.
Credit: Bill Lackey
Credit: Bill Lackey
“There is a lot of expenses that go into creating a restaurant. There is a lot that is required in the kitchen. Closing and shutting that down was difficult. And the new model has different expenses required to get it up and running,” Mattox said.
But, the main challenge remains the uncertainty of the pandemic as it makes it difficult to plan ahead.
“We don’t know what the future holds. We don’t know how it will play out moving forward,” Mattox said.
However, that has not stopped the catering business from coming up with serval ideas that may be implemented in the future.
That includes potentially hosting pop-up nights and introducing more sustainable packaging for its curbside pick-up services.
Clark County businesses receiving most money from Restaurant Revitalization Fund
Young’s Jersey Dairy Inc - $609,111
Seasons Bistro & Grille LLC - $437,803
Sky Dragon Inc - $318,657
Murph & Sara Entertainment Inc. - $290,054.51
Springfield Bowling Center LLC - $256,889
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