For all of the unknowns about the coronavirus, or COVID-19, and the future of the pandemic’s spread through the nation, one thing is already clear — the virus has not been good for business.
But as business owners in Galveston County and across the nation have made the difficult choice in recent days to close up shop and lay off workers by the thousands, the owners of one League City restaurant decided that, though times may be tough, they needed to do the right thing by their employees.
“We met yesterday after the announcement that restaurants needed to close, and you could see the tears on the employees’ faces,” said Ed Oravetz, founder of Red Oak Café along with his wife, Kim Oravetz. The restaurant has locations in League City and Alvin.
“Since we aren’t open in the evenings, we don’t employ a lot of students,” Ed Oravetz said. “It’s mostly adults who need the income to support their families and households. And we just couldn’t imagine doing anything different.”
The owners made the decision to keep all their employees on staff and paid through the coronavirus pandemic, Oravetz said.
While the decision was one they felt they needed to make, it’s not an easy one, economically, Oravetz said.
“We have roughly, between the two locations, about $20,000 per week in total payroll,” he said. “We have a total of about 55 employees between the two locations.”
Oravetz estimates the business has enough cash reserves to last two or three weeks, he said. The owners also secured a line of credit in the event restrictions continue beyond that.
“We’ll end up depleting our reserves and will probably come out of pocket a little bit as well,” he said. “The hope is that we’ll use the line of credit to relaunch things when all this is done.”
The owners also will take the closure as an opportunity to do some maintenance around the restaurant, Oravetz said.
The number of Americans filing for unemployment benefits jumped by 70,000 last week, in one of the first signs of layoffs sweeping the country, according to The Associated Press. Wide swaths of the economy, from the travel industry to restaurants, are hobbled as authorities ask Americans to stay home to slow the spread of COVID-19.
Gov. Greg Abbott issued an order Thursday banning people from eating and drinking in bars and restaurants and telling restaurants to provide take-out or delivery orders only.
Only about 10 percent of Red Oak Café’s sales were from take-out and delivery, and that number didn’t rise much after Abbott’s order, which is why owners made the choice to shutter the two locations, Oravetz said.