Connell McShane:
Chateau On the Lake, who’s been on our show before argues that reopening indoor dinning at 25% capacity, that just won’t cut it in an op-ed at FoxBusiness.com. He says, and this is a quote. “Imagine running a marathon with only 25% of your lung capacity. You couldn’t. And restaurants can’t either.”
Buddy Foy Jr. back with us now. Its good to have you on the show again. I know you’re not a New York City guy, but you’re a New York state guy and you know about margins in the restaurant business. Tell us what this thesis is all about on the 25%, which is where the city’s at.
Buddy Foy Jr.:
Connell we’re upstate New York, about two and a half hours outside the city. And the bottom line is this is a tough industry, it’s a tight margin industry, we all know that. At 25%, there’s no motivation. There’s, there’s no financial motivation. The economics don’t work. And the emotional motivation isn’t there. I know it sounds better than zero, it’s not. Restaurant owners and the supply chain cannot survive on 25% capacity. They need 50 in order to stay motivated, and to work with each other within a supply chain in order to get through the other side of this.
Connell McShane:
I’ve heard the argument about the fifties. Some even say it’s higher by the way, because it depends obviously on the type of restaurant you have, and all that kind of thing. What go, what about the supply chain, what do you mean by that?
Buddy Foy Jr.:
The supply chain is going to have a hard time having faith they’re going to get paid. At 25% capacity.. At 25% capacity, most of the industry will go out of business. Why would vendors, leasers, landlords or banks work with restaurant owners to get through the end of the tunnel here at 25%, when someone’s going to be caught holding the financial bag.
Somebody within a supply chain is gonna to break the financial responsibilities. There’s gonna be going to be bankruptcies. Businesses are going to be out of business. Trucks from a vendor perspective, going out a quarter full. How do you pay drivers? How do you pay gasoline? It doesn’t work. And how do you negotiate terms from a payment cycle and time perspective with good faith? You can’t at 25%. At 50 it’s reasonable. It can be done.
Connell McShane:
Okay. Is that what you’re doing? I know you guys opened up beginning of June, and now you’re upstate as you say, not in New York City. But I guess you’re at 50. And how have things been going since you opened up, how do your numbers look?
Buddy Foy Jr.:
Connell, we were outside. We have a lot of outside dining. It’s getting cold. We’re already out of Adirondacks. We’re up in Lake George, New York. It’s getting real cold, real fast. We are now inside at 50% capacity. We’ve been putting everyone outside as long as we can. We have been at 50% all summer. Now with the cold here, I got to tell you the truth. I’m completely shocked how busy we are seven days a week.
Typically, we do business in the restaurant industry on Fridays, Saturdays and Sundays, and maybe a midweek special. The entire industry with three days, you’re doing 50% of your business. What I want to let the restaurant owners out there know, is with the current conditions, in the current environment, people are coming out over a seven day period. If you can’t fit them in Saturday, they’ll see you on a Monday, on a Tuesday. Last night, a Tuesday night in the cold, we had one of the biggest Tuesdays we’ve had in a non-seasonal environment.
In other words, not July and August on the lake, October. I had the busiest Tuesday I’ve ever had. I’m usually closed on Tuesdays, because it’s a ghost town up here in the wintertime, except for when 100% of the diners don’t have a lot of options to dine, you now have access to that market.
We’re spreading our business over seven days. We’re doing business at 50% capacity, seven days a week, which technically when you’re looking at your weight averages of how you do business over a seven day period. In this industry, it turns out to be greater than 50% of your business that you have access to.
So having access to 50% capacity, will give you access to more business over a seven day period. Cause now you’re spreading the weight of your business over seven days, instead of three or four days of the week.
Our business is up.
Connell McShane:
That’s really interesting. You have that of demand throughout the entire week. It is beautiful for people who haven’t been up near where Buddy is in the Adirondacks, but like you said it gets cold and it gets cold a little earlier than other parts of New York state would.
All right. Final thing, take us through the winter. So from your perspective… Not talking about the city anymore, we already talked about that.
From your perspective, if they keep you at 50, which I guess they probably will. They keep you at 50. You make it through the winter okay? With that type of capacity, and those types of limitations?
Buddy Foy Jr.:
Connell, if they keep us at 50, we’re staying open and I’ll be able to pay the bills. Nobody’s getting rich here. There’s no long vacations anymore. It’s old school. We’re going backwards here. There’s going to be a lot of family time in the Foy house. Spending time local like at everybody else, but we can pay our bills and we will at 50%. Let us operate at 50. Let us stay at 50. We’ll do it safely. We can do it safely. None of my customers have come down with COVID. I’m sorry, none of my employees have come down with COVID, knock on wood.
Connell McShane:
Right.
Buddy Foy Jr.:
And we’ve been operating since the opening back in June.
Connell McShane:
All right. Good luck to you. Might be a message for New York City. We’ll see how things play out there, but that’s a good way of putting it, is that you’ll get by, you pay the bills, but nobody’s getting rich. Buddy good to see you.