Since the Covid-19 pandemic took hold in the DC region earlier this year, many notable and storied restaurants impacted by coronavirus have permanently closed. Industry analysts forecast that 40 percent of restaurants in the U.S. will close in the next six months without more federal financial aid. With infection rates on the rise, public health experts are warning of a grim winter. Even when an effective vaccine becomes available, the public will still be reticent to flock out to restaurants.
Right now, the public at large in DC is too scared and too sensible to sit down and eat at a restaurant. Their concerns are valid — and the customer is always right. So what can restaurants impacted by coronavirus do to survive?
Top concerns for restaurants impacted by coronavirus
Here are some of the top concerns we’re fielding from owners:
- Landlords. Having to pay full rent while making half (or less) of your income doesn’t seem quite fair. Yet landlord demands are increasing, especially as short-term agreements expire.
- Vendors. You can’t sell product if you don’t have the ingredients.
- Lawsuits. Legal actions, primarily based in contract, including internal business disputes, couldn’t come at a worse time.
- Cashflow. Law firms need clients. You need customers. We get it.
- Debt servicing. AmEx has been unusually forgiving since the pandemic began; other creditors, not so much. Collection efforts can distract from your efforts to survive.
Bankruptcy could save your business
Although bankruptcy cannot save every restaurant and bar in DC, the only way to find out is to talk to a lawyer. Do you need time to complete your pandemic pivot? Or do you want an orderly shut down? Is it corporate debt that’s threatening your business’s viability? Are you still moving forward but need breathing room to focus on your future?
If you’re ready to close and liquidate, we can represent you in a Chapter 7 bankruptcy case. If you are recovering from the initial hit but could benefit from restructuring your debt load, we provide zealous Chapter 11 counsel. Finally, the new “fast-pass” Chapter 5 bankruptcy allows qualifying small businesses to avail themselves of many of the options of Chapter 11 while greatly reducing reporting requirements. Call us to discuss your options.