It was the end of October when Monica Plazola, owner of Oakland’s Seawolf Public House, gathered her staff to share some bad news: The neighborhood gathering spot, which opened seven years ago near Jack London Square, would close the following month if they weren’t able to turn things around.
She’d seen friends shutter other restaurants in recent months and had taken to heart what she’d heard from Bay Area diners and waitstaffers— that they’d like to know if things were going badly before things closed, so they might have a chance to help.
What happened next was remarkable: Her team rallied, as did her loyal customers.
They set up a GoFundMe campaign that raised more than $4,000 to help them through the winter. An occasional customer became a regular, and another added Seawolf to the monthly happy hours they were organizing in the area. There was no one big thing, Plazola says, but all those little efforts added up. Seawolf is not out of the woods by any means, but the pub and its crew are still standing. And they’re not alone.
It’s a weird moment in the restaurant world, especially in the Bay Area, where your favorite pub or neighborhood restaurant may be in more trouble than you realize. How they got here and what can be done are complicated issues. There’s no one cause and no easy fix, but four years after the pandemic began, restaurants are still struggling.
“Elevated costs, shallow labor pools and uneven customer traffic levels were the norm for many restaurants — but operators persevered,” write the authors of a new report by the National Restaurant Association. Staffing shortages remain the top challenge for restaurants, but the drop in sales from 2022 to 2023 reported by half the nation’s restaurant owners is a worrisome second. And 38% of restaurants reported that they were not profitable.
The pandemic era has wrought a substantial shift in restaurant-going habits toward off-site dining — takeout, delivery, drive-thru and food trucks — rather than dine-in. Last year, 74% of U.S. restaurant traffic came from meals eaten off-site, up from 61% pre-pandemic, says association spokesperson Vanessa Sink.
The result is that once-bustling dining rooms have become much more unpredictable. Take Wursthall, San Mateo’s German-inspired restaurant and beer hall. The once-reliable, post-work happy hour crowd and weekend foot traffic have evaporated, says Wursthall partner Xian Choy. The holiday season was slow. And while an occasional Wednesday is suddenly super busy, some Fridays are dead.
But restaurants have to be ready all the time, Choy says. You don’t want to be the eatery caught by surprise when a big crowd shows up. Wursthall cut its lunch service and restricted hours to build capacity for likelier peak times.
Walnut Creek’s Cuban-inspired Havana dropped its lunch service too — and happy hours — and instead created weekend brunch. So far, that experiment is working. Owner Joelle Scimia says one day of brunch service brings in more income than five days’ worth of lunches.
“People are cutting both ends of the sandwich,” says Adam Stemmler, who runs several bars and taprooms, including Oakland’s Arthur Mac’s Tap & Snack and Lafayette’s Headlands Brewing.
He’s noticed restaurants cutting lunch service and closing earlier, particularly in Oakland. Stemmler’s customers are opting to dine in more suburban areas, like Walnut Creek and Lafayette, because, he says, they’re sick of getting their cars broken into in Oakland. And both he and Plazola expressed concern that their restaurants will be further impacted by large Oakland employers, such as Kaiser Permanente, suggesting recently that their employees bring their own lunches or have it delivered due to safety concerns.
Waitress Sofia Plazola delivers food to customers during a Trivia night at Seawolf bar in Oakland, Calif., on Wednesday, Feb. 7, 2024. (Ray Chavez/Bay Area News Group)
“Sometimes it’s more attractive to order delivery and binge a new show than it is to walk or drive to a pub and engage with other people,” Plazola says. “I think that’s one of the lingering societal effects post-COVID.”
Those lingering effects have been huge. The move to remote and hybrid work impacted restaurants at the time, of course, when the Bay Area saw a nearly fivefold increase in remote workers between 2019 and 2021. But new habits — cooking at home, getting takeout, avoiding indoor dining rooms — have taken hold for many diners.
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In San Jose, the high office and hotel vacancy rate and remote work patterns are still impacting restaurants in the city’s downtown area, says chamber of commerce president Leah Toeniskoetter, who hopes a nightlife uptick may turn things around. Right now, she says, increasing takeout and delivery offerings are key.
That’s true across the Bay Area, where DoorDash and ghost kitchens such as CloudKitchens and Local Kitchens are booming, and delivery is fueling expansion as well as survival. Square Pie Guys, which has brick-and-mortar eateries in Oakland and San Francisco, has partnered with Local Kitchens and DoorDash to reach customers in San Jose and Redwood City, says co-owner Marc Schecter. On the Peninsula, Zareen’s is doubling the size of its Palo Alto restaurant kitchen, owner Zareen Khan says, to boost their to-go volume.
It’s not an unabashedly great solution for everyone, though. While delivery services and ghost kitchens can certainly boost to-go sales, delivery fees mean significantly lower income per meal for the restaurant — DoorDash charges restaurants up to 30% commission per order. And if the point of your beer hall is socializing over great food, takeout removes the vibe.
“The experience of being here and drinking with your friends is integral to what our business is,” says Wursthall’s Choy.
Patrons enjoy their drinks, food and a Trivia night at Seawolf bar in Oakland, Calif., on Wednesday, Feb. 7, 2024. (Ray Chavez/Bay Area News Group)
Running a restaurant today requires flexibility and tough choices, says Stemmler, and after several tough years, some restaurateurs are just too tired to keep going.
What’s going to keep your neighborhood favorite alive? Seawolf’s Plazola doesn’t have answers. She’s just trying to get more people to sit down, have a pint, perhaps check out their new trivia night — and come in from the cold.
“We want people to come in and get that warm welcome,” she says, “and know there’s a community here for them.”
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