ReboundMaking Ends Meet


Restaurants looking to reopen face financial hardships like never before

Posted at 12:32 PM, May 15, 2020

DENVER, Colo. – Coronavirus concerns forced Sam’s No. 3 diner to shut down for seven weeks.

When they reopened for takeout orders only, they found challenges with fickle food costs

“Prices are crazy right now,” said owner Sam Armatas. “The supply chain is messed up.”

Armatas says before the pandemic, this iconic Denver diner served nearly 1,700 people a day. Now, they’re lucky to make 70 meals from open to close.

“I want to cry every day,” Armatas said. “It’s sad.”

Armatas says he is struggling with expiration dates and an erratic economy.

“Today an egg is 8 cents. right before it was 25 cents an egg,” he said. “We’re dealing with food in the warehouse that has probably been in the warehouse since mid-March.”

From produce to proteins, economic experts say the cost for restaurants to do business is becoming more unstable.

“They’re really are disruptions all throughout the supply chain,” Richard Sexton, Ph.D., a distinguished professor of agricultural and resource economics at the University of California, Davis.

Sexton says restaurants looking to rebound will have not only have problems with food pricing but also dealing with new health guidelines.

“The meat prices have risen and will probably continue to rise. Milk prices are down due to reduced demands,” he said. “People will be, at least at the outset, reluctant to resume their normal habits.”

Despite the challenges, Sexton doesn’t predict that extra cost will impact shoppers at supermarkets.

“The last thing a big grocery chain wants is to be accused of price gouging during a pandemic,” he said. “They would rather be stocked out of product than raise price to equate the supply with the demand.”

Moving forward, Armatas says this pandemic could impact how they list their prices.

“I don’t know if we can come out with a paper, or a solid menu again,” he said. “It’s almost we price weekly at market value.”

For Armatas, this is the new cost of doing business during the COVID-19 crisis.