Tips for keeping cash flowing in restaurants

We are aware of the significant impact the COVID-19 pandemic is having on McDonald’s owner/operators and the restaurant industry in general. McDonald’s Corp. has provided some relief with rent deferrals and suspension of major remodeling projects. There are other ways, as well, that owner/operators can manage cash flow in your restaurants while traffic is diminished dramatically through the closure of dining rooms, social distancing rules and shelter-in-place rules across the country.

We will continue to monitor the situation and keep you advised about the best strategies to weather this unique storm.

Please take a look at some of the tips we have put together. If you have any questions, do not hesitate to contact us.

FINANCES

  • Update your cash flow projections. We have a new tool that will help with this process.
  • Closely monitor the aid and relief packages offered at the federal and state levels. Work with your advisors so you can be prepared to respond quickly.
  • Work with your lender on deferring principal loan payments. Some banks are offering three to six months interest-only options.
  • Pay bills on the due date. Do not pay early.

OPERATIONS

  • Closely monitor labor costs on a daily and hourly basis.

OVERHEAD COSTS

  • Review certain restaurant services such as landscaping services, television service, lobby music, window washing services, etc. and consider changing the frequency of the service.
  • Review certain maintenance and service contracts, such as HVAC, trash pickup and consider changing the frequency of the service.
  • Reduce the frequency of mat cleanings.
  • Adjust thermostats in the dining room, PlayPlaces and other areas with no customer traffic.
  • Turn off lights in areas of limited traffic.
  • Contact utility and telephone companies about ways to reduce your rates. Keep your eye on your water bill to make sure it reflects lower usage.

FEES AND TAXES

  • Contact your local governments to see about abatement or deferral of some fees or taxes, such as stormwater fees, license fees, etc.  Some states are offering grace periods on paying sales/meals/use taxes.
  • Talk to your insurance broker to see about deferrals of premiums or for business interruption coverage.
  • Contact DoorDash and/or UberEats to see if they will waive commissions or offer special deals in your service area.

MARKETING

  • Review advertising you are doing at the local level, separate from Opnad and your local Co-Op and maybe consider changing the strategy.
  • Boost free marketing efforts through social media and direct email campaigns.
  • Post photos of your food on social media channels or videos of traffic through your drive-thru’s or delivery teams picking up orders.
  • Boost traffic through targeted offers for local health care workers, first responders, or educators, for example.
  • Have a manager deliver breakfast or lunch to retirement home.
  • Promote special deals like family pack meals.