My Bar Failed Because of Covid. Here’s Why I’m Happy About It

(Bloomberg) -- Fort Defiance, my neighborhood cocktail bar in Red Hook in Brooklyn, N.Y., was born at the right time. It was June 2009, the very month that historians now mark as the end of the Great Recession. New restaurants and food businesses were sprouting all over the borough like mushrooms after a hard rain. Entrepreneurs such as me weren’t aware that we were establishing Brooklyn as the new center of global hipness; we were just following our bliss, jarring artisanal pickles, crafting bean-to-bar chocolate, and writing farm-to-table menus, all under the crepuscular light of a million Edison bulbs. It felt meaningful and exciting, as if we were doing something important.

Those days are a dim memory now, and soon the old Fort Defiance will be, too—another casualty of the coronavirus. And you know what? I’m pretty happy about it.

As a wise Brooklynite, the Notorious B.I.G., once put it: Things done changed. Even before the pandemic, no one was talking about what a great time it was to operate an independent restaurant, especially in New York. As the cost of city living soared, the minimum wage doubled—an admirably progressive move, but one with predictable effects on the bottom lines of small businesses. We used to offer health care to our workers, but stopped when our monthly premiums tripled. When our 10-year lease ran out last year, the landlord jacked the rent by 80%. Our revenue increased every year, but our expenses always rose to meet it, and a little bit more.

As our cash flow slowed to a trickle, we tried to ignore the incessant come-ons from extortive delivery services or usurious merchant cash advances. Increased financial stress wore down our connection with our community till it felt as thin as our profit margins, which never approached even the anemic 10% that some experts consider successful in this industry. We were surviving but just barely.

And then, in March 2020, things got suddenly and unimaginably worse. When restaurants were shut down, we tried doing delivery for the first time, but couldn’t make it happen. Our most popular items—deviled eggs, chicken liver pâté on toast, Irish Coffee—simply don’t work when boxed up to go, and bottled cocktails were no substitute for the real thing. On March 27, I pulled the gates, turned off the lights, and went home.

A few days later, I was hungry and scared, so I started selling groceries. My cupboards were bare, supermarkets seemed like seething petri dishes of infection, and online grocery delivery was simply a mess. I called one of our favorite vendors, a co-operative of organic family farms in Pennsylvania, and discovered they were still delivering to New York. I posted about it on Facebook, and the next day I ordered farm-share boxes of produce for myself and a few neighbors. In the drear of a wet, gray spring, these boxes were vibrant postcards from a pre-Covid-19 world, loaded with gorgeous winter vegetables: purple turnips, braising greens, black radishes, carrots, and winter squash.

Unlike our struggling delivery business, our grocery business grew. Word got around the neighborhood, and orders increased. I added such pantry staples as milk, eggs, and butter to our inventory, and arranged contactless pickups for my customers who, without exception, were enthusiastically grateful. In weekly emails, I shared recipes and local gossip with our shoppers, who in turn sent me pictures of dinners they made for their families with ingredients they bought from our improvised general store. My landlord agreed to temporarily lower my rent by 50%; I had never signed a new lease when he last raised it, which put me in an unexpectedly strong position to negotiate.

Our sales were less than half of what they had once been, but our Paycheck Protection Program loan from the Small Business Administration was covering payroll. The six employees I rehired were the only ones, of the 25 who worked there pre-pandemic, willing to come back to work. I couldn’t deny the feeling that we were doing something good again, something more significant than just surviving.

We restaurateurs are a scrappy lot, born hustlers who think that most problems can be fixed by working a little harder or a little later into the night. You can see us throughout the city today, running deliveries, pouring beer for passersby, setting up makeshift terraces in the gutters, and praying for no rain. We’re tough as hell and we’re doing our best, but bulldoggedness is not going to get us through this crisis.

It doesn’t take an economist to tell what’s coming: increased unemployment, decreased consumer spending, and a general reluctance among sensible people to dine in crowded restaurants and drink in crowded bars. That will affect all of us for months, or years. The government is not going to save you: Arbitrary restrictions and regulations will continue to haunt your business for months—especially, it seems, if you’re operating a bar (Cuomo chips, anyone?).

It’s time for every restaurateur and bar owner to do something that’s very difficult right now: Stop working.

Take a moment to let this sink in. Our country could have controlled the spread of this virus, but we screwed it up. And instead of fixing our mistake, we seem determined to make it worse with every day that passes. That’s why your business is dying. It’s not because of anything you did or didn’t do.

Now get out from behind the bar and call your accountant. Take a good, long look at your company’s financials. Run some projections. How much money are you losing every month? How much longer can you keep this up?

At Fort Defiance, I performed this painful exercise myself, and the results were all too clear. This was before talk of the Restaurants Act of 2020, which, if passed, would distribute $120 billion in grants to small restaurants—a badly needed step in the right direction. But I doubt it would have changed my final analysis: We just weren’t going to make it as a bar.

So I moved my tables, chairs, and cocktail glasses to storage—I couldn’t bear to just throw them out—and started shopping for produce merchandisers and ice-cream freezers with my EIDL (Economic Injury Disaster Loan). I scored some patio furniture from another restaurant’s going-out-of-business sale so up to a dozen customers could picnic on our sidewalk, and even bought a new $2,500 chicken rôtisserie. (I tried to find one second-hand, but couldn’t, which I took as a sign that you don’t go broke selling rôtisserie chicken.)

I figure it will take about $30,000 to convert my restaurant into a charming little ersatz grocery, selling organic produce, prepared foods, meats, cheeses, and the like, and I look forward to welcoming my neighbors into the refitted space by Labor Day.

Instead of the little, two-top table in the corner where couples used to dally, we’ll install a refrigerated case full of fresh mint, sweet corn, and zucchini flowers. Where brunching families used to feed their toddlers scrambled eggs, we’ll stack loaves of fresh-baked bread. Instead of hosting our neighbors’ nightly carousings, we’ll supply the parties they host at home, and that feels like true hospitality right now. Fort Defiance is not going to reopen as a restaurant; it’s going to grow as a general store.

Saying goodbye to the old Fort Defiance isn’t easy—not for me, our staff, or our regulars. We’ve always tried to channel the pluck of our Revolutionary War namesake, which in 1776 pointed its four 18-pound cannons at 400 British ships amassed in New York Harbor. We survived a lot together, including the floodwaters of Hurricane Sandy. To be honest, sometimes this change feels like giving up.

Lately, I’ve found comfort in the writing of our neighbor, Maria Popova, who talks about the fear of change in her book Figuring: “At watershed moments of upheaval and transformation, we anticipate with terror the absence of the familiar parts of life and of ourselves that are being washed away by the current of change. But we fail to envision the unfamiliar gladness and gratifications the new tide would bring.”

The past is gone; the present is lousy. The pandemic has changed so much, and I know that there is no way back to normal. But now, at least, there are times when my fear of an unknowable future feels like exhilaration.

©2020 Bloomberg L.P.