Coalition calls for urgent action to help restaurants

Hey there, time traveller!
This article was published 20/07/2020 (1688 days ago), so information in it may no longer be current.

A coalition of business groups is calling for “urgent action” from all levels of government to save the food service industry from “imminent failure” amid the economic fallout from the COVID-19 pandemic.

The consortium — which includes 18 industry and business representatives from across Canada, including Molson Coors Beverage Co. and the Winnipeg Chamber of Commerce — is urging moratoriums on rent evictions and easing tax burdens on the food and hospitality industry, among other “urgent actions,” in an open letter dated Monday to the prime minister, Council of the Federation and Federation of Canadian Municipalities.

The group writes that the majority of restaurants face an uncertain future when it comes to continued operation as safety requirements limit revenue and increase costs in an industry with already thin margins.

Prior to COVID-19, states the letter, the food and hospitality sector directly created one out of every 15 jobs (roughly 1.2 million Canadians) and served 22 million meals per day.

“Today,” the letter reads, “the industry is untenable as revenues are off by between 60 and 70 percent amid continued social distancing rules while the industry must continue to pay nearly full pre-COVID level costs.”

“No business can continue to run at a loss indefinitely,” says Loren Remillard, president and CEO of the Winnipeg Chamber of Commerce. “And it’d be a shame if we had to let go of our local restaurants that form so much of our cities’ identities.”

Remillard says each sector has been impacted on a different level during the pandemic. He pointed to data from the letter’s authors that suggests the restaurant industry will be among the last to resume normal operations, estimating a span of at least the next 12 to 18 months.

“If there was a business that was adamant not to adapt to new trends in their industry like e-commerce, that would be something of their own choosing,” he said.

“But COVID-19 is not a trend. It’s nothing we could have ever prepared for.”

Shaun Jeffrey, executive director of the Manitoba Restaurant & Foodservices Association, said easing property taxes and fees associated with utilities and patio upkeep will “undeniably” help the province’s restaurants.

“It doesn’t take a mathematician to see the issue here,” he said. “When you’re only at 50 per cent of your revenue and still incurring high costs of fees and taxes, it’s hard to keep going.”

“Add on top, the fees of personal protective equipment and it’s an even bigger problem.”

Jeffrey said the letter’s suggestion to implement moratoriums on commercial rent eviction is something he’s heard from multiple Manitoban businesses during the pandemic.

“We’ve seen people kicked out of buildings because they couldn’t afford rent,” he said. “It’s a pandemic and we have to understand that it’s going to take some time before things are better.”

The letter’s authors also asked the federal government to implement proposed improvements to the emergency wage subsidy and continue to create incentives for people to return to work. It asks them to eliminate the automatic annual federal excise tax increase on beer, wine and spirits, and start encouraging people to resume pre-COVID activities with safety measures.

Bram Strain from the Business Council of Manitoba and Chuck Davidson from the Manitoba Chambers of Commerce, however, believe that protocols must be in place so that businesses don’t become entirely dependent on government support.

“We have to understand that all of these incentives must have timelines,” said Davidson. “In order for them to be actually helpful, they have to keep being updated as we try to understand what are the areas that support is most needed and most utilized.”

“The golden question here is to figure out when government needs to stop helping,” said Strain. “If we’re only going to ever see restaurants get to 50 per cent capacity, at what point do the businesses have to take the responsibility themselves and change their business models?”

“That’s an answer we won’t have for a while.”

Steve Hrousalas, who runs Rae & Jerry’s Steak House on Portage Avenue, says he wishes there was a way to convince people to come back to his restaurant in the numbers they once did.

Hrousalas said federal support has been helpful for his business, but “the City of Winnipeg needs to do more.”

“What the city doesn’t understand is that if they keep taking money from us now, they eventually won’t have anyone to take money from at all.”

“All I can do is make sure we’re following health protocols until it’s all better,” he added.

 temur.durrani@freepress.mb.ca