The Challenge
According to Restaurants Canada’s Restaurant Outlook Survey published in April 2020, an estimated 800,000 foodservice employees were either laid off or not currently working as a result of government-imposed restrictions put in place to slow the spread of COVID-19.
“The initial effects were like a Tsunami that kept on coming and [there was] no real plan for such an event as everything happened very quickly,” recalls Dorrie Karras, CEO of Calgary-based OPA! Of Greece. “Our first priority was to support our franchisees, as most were forced to close or limit their operations. We proceeded to slash royalties and marketing fees by 66 per cent in the form of an abatement and not a deferral.”
That meant the fast-casual chain now had its major revenue stream reduced to 33 per cent. “And that was on much lower sales, which meant we had to cut expenses to keep the company from bleeding at a rapid rate. At that time, I had to make one of the most difficult decisions of my professional career and layoff almost half the head-office staff. The remaining staff’s salaries and hours were also cut, but after a few months, all staff were brought back and full salaries reinstated.”
Finding ways to keep people was a challenge also faced by Calgary-based Browns Restaurant Group (BRG). “We have so many great people in our restaurants and the biggest challenge has been to find ways to sustain sales revenues to allow us to keep as many of our people employed as possible,” says James MacFarlane, vice-president, Operations at BRG. “Maximizing our off-premise dining as a sales channel has been key in this effort. We have adopted new technologies, adjusted how we operate, changed our floor plans and our restaurant designs all to facilitate greater off-premise sales while keeping our guests and our teams safe.”
The logistics of staffing were also a challenge, as regulations across the country continued to change when the virus hit its second wave and sales volumes continued to fluctuate.
“Typically, in our restaurants, we can forecast our daily/weekly sales quite accurately to allow us to schedule properly to provide the best possible guest experience,” says MacFarlane. “Through the pandemic, forecasting has become challenging. Consumer spending habits and patterns seem to change weekly, depending on reports in the news or changes in provincial COVID-19 regulations. This has resulted in some tough times for our teams where we have been unexpectedly understaffed. Conversely there have been periods of overstaffing that have challenged us financially.”
Changes to roles and responsibilities as a result of these fluctuations presented yet another challenge for BRG. “In our restaurants, and throughout our organization, our people have taken on more work or different work than they did before. Keeping people engaged and feeling valued while they take on more work, or work they weren’t accustomed to, is an ongoing challenge,” says MacFarlane.
And as an industry that relies heavily on part-time workers, MacFarlane says the introduction of the Canadian Emergency Response Benefit (CERB) meant, in many cases, “we have not been able to secure the part-time people we need as they have opted to not work and collect the CERB benefit instead.”
MacFarlane says, at BRG, “we haven’t needed to do much hiring, but when we have, it’s clear that experienced staff and managers are not actively looking for work. We hope that this is because experienced people are staying put in their current roles, but we fear this is a sign that many experienced people have fled the F&B business in search of a more stable sector.”
The Opportunity
In the 2020 Canadian Chain Restaurant Industry Review published by CWB, NPD Group and fsStrategy, Allan Dick, co-managing partner, Sotos LLP, predicted the volume of restaurant closures “would generate a tremendous pool of available employees at a time when demand had previously outstripped supply — a trend which had previously been expected to accelerate rather than decline.”
The opportunity now exists, says Dick, for restaurant owners to be aggressive in attracting top talent.
This is also the time, says MacFarlane, to re-examine operational efficiencies. “While we’ve always prided ourselves on being very effective and efficient in running well-planned and well-costed schedules, the pandemic forced us to re-visit what lean looked like. In order to survive the worst days of the initial COVID-19 shutdown, and ups and downs since then, we had to re-visit every minute of every schedule shift for every person in our restaurants. This perspective has allowed us to really zero-in on where inefficiencies have existed in the past and how we can better deploy our people.”
He also points to the new-found opportunity for cross training and teamwork as a silver lining over the past year. “From our GMs and chefs through to the front- and back-of-house staff, everyone has had to become more knowledgeable and versatile. This has resulted in improved efficiency levels and an increase in comradery and pride,” says MacFarlane.
The biggest opportunity Karras says he was able to leverage at Opa! was the “benefit of clear, open communication. To keep our restaurants open and make sure our team rosters were full, we needed to trust each other (to follow the rules, to stay home when you’re sick and come to work when you’re not). Clear expectations, strong commitments and trust are essential and you can’t have those without communication.”
Operationally, he said the chain adjusted and accommodated along the way, but has not made any permanent changes. “There’s been a tectonic shift to online ordering, [which has] added an extra level of complexity to the stores. For that reason, we continue to investigate and adopt new technologies that can make the operators’ lives less stressful in managing the new way of doing things.”
“COVID-19 has thrust change upon us in many parts of our business,” agrees MacFarlane. “This rapid succession of change and adaptation has made our teams nimbler and has better equipped everyone in our restaurants to handle the evolutions that will be critical in our recovery going forward.”
