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Impact of NYC’s Covid-19 vaccination proof mandate for restaurants

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Chef & Owner of Dirt Candy in NYC, joins Yahoo Finance Live to discuss the impact on restaurants by NYC’s vaccine mandate, outlook on labor, rising price costs, and the recovery of the restaurant industry.

Video Transcript

[MUSIC PLAYING]

- This week New York City became the first major US city to require restaurants, gyms, and arenas to ask customers for proof of vaccination to gain access to indoor venues. Any business that fails to comply, could face a fine of $1000.

Joining me now is Amanda Cohen, James Beard nominated chef and owner of Dirt Candy in New York City. Amanda, great to see you again. I'm curious to know how things are going, this is the first full week of that New York City mandate, what have you and your team been experiencing?

AMANDA COHEN: Actually, it's been pretty smooth sailing so far. We haven't had a lot of pushback, people have been pretty excited to show us their vaccination card and they don't mind showing us their IDs and so I haven't really noticed much difference from beforehand.

- That is really great because I don't know if you're aware but there was a disturbing video out there, some cell phone video, that a patron caught. Just yesterday, a restaurant on the Upper West Side, the hostess asked three patrons, they were from Texas, to show their vaccine card.

Those people got so upset they assaulted that hostess and now those people are arrested and being dealt with by authorities. But does that worry you? Does that concern you? Like, how do you keep your staff safe during this time?

AMANDA COHEN: You know, I don't know. I mean, when that happens we'll deal with it, I'm hoping that at my vegetarian restaurant, it won't happen. And, you know, the truth is that we have an alternative. It's not like we're saying you can't eat it all at Dirt Candy, you just can't eat inside but we do have our outdoor patio, it's beautiful, people love sitting out there, it's still really nice weather.

I don't know what will happen if somebody gets really irate with us but we'll deal with it, we'll call the police and they'll never get to eat at Dirt Candy again.

- Right. Well, do you feel, though, that the city is giving you, and sort of the restaurant industry in general, the resources you need to help implement this mandate?

AMANDA COHEN: I think more so than most of the other mandates that have been implemented, we actually had a really long time to deal with this. We knew it was coming, we had about four to five weeks to implement it, to talk about it with our staff, the city knew, we've called all of our guests, they all know what's going on.

And so it's a little bit different than at the beginning of the pandemic when sort of these mandates were put in place overnight, we know it's coming and we've had a chance to deal with it. So, yeah, actually I think the city's done right by us this time around.

- So I want to ask you about another big challenge facing your industry right now and that is an ongoing labor shortage. A lot of folks did not come back to their restaurant jobs because of what had happened during the pandemic, they either left the industry altogether or they're just not working right now.

And I know those extra weekly unemployment benefits expired just recently and I'm wondering what you're seeing. When that happened did you see interest beefed up or accelerated interest, I guess, from people looking for work?

AMANDA COHEN: You know at Dirt Candy we were actually fully staffed since we reopened indoor dining, which was in May. We pay our staff way above minimum wage, it's $25 an hour and we offer lots of benefits. But I do-- I'm a co-owner in another restaurant called Lekka Burger and they were struggling a little bit to find staff but in the last week or two, we've gotten a ton of applications there.

And so I think the staffing crisis is probably getting a little bit better. It wasn't great before the pandemic, we were really sort of searching for chefs and servers like two years ago. So I think we're probably back to two years ago but it's not as horrible as it was six months ago.

- Well that's certainly encouraging but I think it's great that you're able to pay your workers as well as you are, you said $25 an hour. What can you tell other restaurant owners who might not be in that position but hope to be there at some point? What's the path forward to sort of make it to that point with your workers?

AMANDA COHEN: You really have to rethink your business plan. When I closed Dirt Candy a year and a half ago because of the pandemic, I promised myself I wasn't going to reopen the same business. I wanted to make sure that my staff is more financially secure, the business was more financially secure, and I was too.

Within two weeks, all our savings were depleted and so we sat down and really looked at our business plan and we tried to figure out how we could make this run like a real business that didn't just operate on like 1% profit because that's not sustainable.

And so we raised our prices a little bit, we sort of tightened up our food costs and a lot of our other costs and it's working. We're able to pay our staff and we're not hemorrhaging money anymore. So there are things that you can do.

- You know, I know that the margins in the restaurant industry is super thin. And you talk about raising prices, I'm curious what the impact has been for you in terms of, first, supply chain but also those prices of the food that you're serving your customers. And are you having to continually pass that on to the consumer?

AMANDA COHEN: Yeah. I mean, every restaurant continually passes every single cost onto their consumer, that's how we stay in business, right? We are definitely seeing a lot of our, like our produce prices go up, like our frying oil has gone up by like 50% and so there are these like random little things that are really increasing our prices.

And, yeah, we have raised our prices and sort of passed that on to our customers but my customers have actually been really OK with it. We talk to them, we let them know that why our prices are so much higher, that there are all these increased costs and that we're paying our staff so much more and they are actually all for it.

Everybody spent the last year and a half reading about restaurants and how hard it was to run a restaurant and what we needed to do to save the industry, and by and large, I find that most people actually want to save the industry and help it and they're willing to put a couple more dollars down on the table.

- Yeah, lots of support out there for those front line restaurant workers. Are there any particular items you're just having a really hard time getting right now? Fruits, vegetables, what is it?

AMANDA COHEN: We have a couple of specialty items that we're having a hard time getting but I think the biggest difference that we're noticing is actually, it's getting our deliveries on time. It's not just the restaurant industry that's having a labor shortage, it's also my delivery companies that are having labor shortage and the people who supply them.

And so oftentimes we're finding that our deliveries are coming like hours later, if they're coming at all and that's something that we're really starting to have to like work around and struggling with.

- And I'd like to get your thoughts on this. The other day I actually interviewed the CEO of Alicart, and that's the restaurant group that owns Carmine's and Virgil's. And he was telling me that he thinks the government needs to step up and replenish the restaurant recovery fund.

He said that there were 300,000 restaurants out there applying and only about 100,000 got help, that's according to him. I'm curious if you had to get any of those funds and do you think that that restaurant fund does need to be replenished?

AMANDA COHEN: Absolutely, it has to be replenished, lots of restaurants aren't going to survive without it, one out of every three restaurants really-- or two out of every three restaurants really won't survive. And it sort of put these restaurants in these different categories.

So there's the haves that have the fund and then the have nots that don't and now it's hard, very hard to be competitive because you're competing with restaurants down the street that have a much bigger bank account than you do.

I, unfortunately, was one of those people that did not get the grant, even though I was one of the sort of-- I'm in the priority group, I'm a woman and I own my restaurant outright. And, yeah, I would really like those funds, it would certainly help us all feel a little bit more secure. So we are desperate, every single restaurant that didn't get the fund, is desperate for it to be replenished.

- Now I'm hoping that the lawmakers hear you because you guys are doing great work out there, continuing to feed all of us. Amanda Cohen, chef and owner of Dirt Candy, best of luck to you and your team. Thank you.