Three in five restaurants need additional funding for fixed costs and payroll to fully reopen and stay open, according to new data from the James Beard Foundation, in collaboration with the Independent Restaurant Coalition (IRC). Independent restaurants and bars surveyed in May and July were asked about their current operational procedures, the challenges they face in staying open and their outlook for the future.

The results released on Aug. 6 revealed independent bars and restaurants had, on average, just 66% confidence they could stay operational through October. In May, nearly 75% of independent restaurants reported taking on new debt obligations of more than $50,000, with over 12% reporting obligations exceeding $500,000.

What’s more independent restaurants reported that the 50% and 25% seating capacity mandated in several states and localities would not be enough to stay open. Respondents said that they need nearly 60% seating capacity on average in order to remain open permanently. 

Among the other survey findings: 

• Restaurants are Concerned about the Return of Customers. Some 39% of respondents indicated consumer fears about COVID-19 transmission among their top three concerns about reopening.
• Owners Cite Unpredictability as a Top Concern for Reopening. Nearly 36% of respondents rank unpredictable state guidelines for operating among their top three concerns regarding reopening.

• Restaurants Struggle to Cover Basic Costs. In May, 69% of restaurants named rent and payroll as their biggest, most immediate cash challenge. In July, 52% of respondents indicated relief for new PPE expenses, rent, mortgage, payroll, staff benefits and vendor expenses as their top priority.
    
• Restaurants Overwhelmingly Cite Health and Safety of Staff and Customers as a Top Priority. Restaurants surveyed in July cited the health and safety of employees and customers was their top concern in reopening. At the same time, customer behavior was a growing concern; 27% of respondents listed it among their top three worries for reopening. Owners cited customers not wearing masks (82%), not social distancing in common areas (71%), potential conflict over safety with customers (71%), and staff mistreatment (65%) as top concerns around customer behavior.
    

The James Beard Foundation fields a monthly survey around COVID-19. This report covers surveys fielded May 19-29, 2020, and July 14-28, 2020. The total number of respondents for the two surveys was 2,107. Respondents were 51% male and 46% female; 76% of respondents identified as white or caucasian.