Layoffs, refunds and no cash flow: Restaurants, gyms hunker down on Day 1 of new restrictions

Layoffs, refunds and no cash flow: Restaurants, gyms hunker down on Day 1 of new restrictions

‘This is going to be a tough one and, realistically, I believe it will last two months as opposed to the three weeks they announced,’ says one Barrie restaurant owner

With more government-imposed restrictions coming into play Wednesday, many restaurants, gyms and other businesses are worried that, without immediate provincial help, they may not be able to ride this one out.

Premier Doug Ford announced on Monday that starting Jan. 5, the province would return to a modified step two of the Roadmap to Reopen in an effort to slow down the quickly rising cases of the omicron variant. The new measures will be in effect for at least 21 days, until Jan. 26.

Some of the industries hit hardest by the restrictions are restaurant/hospitality and gyms, which have been ordered to close outright to in-person service. Indoor dining at restaurants and bars is closed while outdoor dining is allowed with restrictions, as is takeout, drive-through and delivery. Meanwhile, gyms can’t have anyone inside working out and have to resort to online training, if they have that option.

Steve Ricalis, who co-owns Donaleigh’s Pub, Dunlop Street Diner and North Country, all located in downtown Barrie, told BarrieToday that between the three restaurants, 90 people were laid off Tuesday. 

“Right now, there are a lot of people just doing part-time here and there, but really it’s my managers running the front and getting takeout done,” Ricalis said. “Even my kitchen staff is down to maybe 70 per cent.

“This is going to be a tough one and, realistically, I believe it will last two months as opposed to the three weeks they announced,” he added. 

Ricalis says he tries to remain optimistic, but said the initial three weeks the government announced the restrictions would last “would only see the peak and then they will want to take another three weeks to stabilize their numbers.”

On Tuesday, the provincial government announced it was expanding the new Ontario Business Costs Rebate Program to help people impacted by the new public health measures. Eligible businesses that are required to close or reduce capacity will receive rebate payments for a portion of the property tax and energy costs they incur while subject to these measures.

Eligible businesses required to reduce capacity to 50 per cent, such as smaller retail stores, will receive a rebate payment equivalent to 50 per cent of their costs, while businesses required to close for indoor activities, such as restaurants and gyms, will receive a rebate payment equivalent to 100 per cent of their costs. 

Ricalis says help like that would be great, but it isn’t enough and isn’t being done fast enough. 

“We need the money today. We need the money yesterday, really,” he said. “Getting the money in a month and half isn’t as helpful. I’m not trying to sound ungrateful, but it’s just the reality. By the time we apply, go through the red tape, payments won’t happen until mid-February.”

Barrie Mayor Jeff Lehman has also been echoing those concerns that the need for money is now.

“What these businesses need now, because they’ve been closed, is more along the line of what the province did in the early part of 2021 with the Ontario Small Business Support Grant,” Lehman told BarrieToday. “I know the Auditor General criticized that a bit, because they rushed the money out and was everyone eligible? I know you need careful controls, but I think right now the urgency for immediate money is a major issue.”

Lehman said he has been talking to restaurant owners over the last couple of days and has heard many concerns being voiced, one of which is the food they stocked up on for in-house customers. 

“Many are donating where they can, but these restaurants have food on hand and orders that are coming in today and this week they can’t cancel,” the mayor said. “They’re spending $10,000 to $20,000 on supplies and they’re not going to be able to sell it.”

Over at Malones Pint House, owner Sarah Lynne Maloney also laid off some people and kept a “minimal skeleton staff” for her Bradford Street establishment.

Like other business owners, Maloney has been here before and was very blunt about how the last restaurant shutdown forced her to only serve takeout.

“Oh, it was awful,” Maloney told BarrieToday. “Everybody tries to help, our customers were wonderful in that regard, but understandably people can only do so much. You can’t order food… four or five times a week.”

To help with costs, Malones will only be open Thursday to Sunday until the shutdown for the industry is over.

Maloney says she’s frustrated with how the government funding is rolling out, saying she can’t apply for one option until Jan. 19, but the current restrictions last until just after that.

Ricalis pointed out another major problem with the provincial assistance, which he called a “flawed” system. 

“When sending money to help, they base everything on sales from the previous year. Well, last year our sales were down because of lockdowns, so we’ll get a percentage of that which will not help,” Ricalis said. “In the case of North Country, we opened it during the pandemic, so we don’t have any help coming in for that because the previous year was non-existent.”

Lehman says he has been hearing the plight of business owners who ask that the city do more to help, but says municipal government cannot help as much people think. 

“We’re a municipal government and we get eight cents out of every tax dollar in the Canadian federation, so we need the guys who get 92 cents to come and help quickly,” he said. “Local government doesn’t have the kind of dollars to lend help when the provincial government shuts down businesses.”

Lehman said the City of Barrie has been able to help somewhat, such as deferring property taxes and water bills during the last 20 months, and that’s something he said “we may do again.”

Rob Gathercole, who owns Training For Warriors gym in the city’s south end, spent Wednesday sending refunds to everyone who paid on Jan. 1 for gym services.

“The kicker there is not only do I refund everyone their fees, but I get dinged a dollar service charge per e-transfer from the bank,” Gathercole said. “All you can do is laugh or it will eat you up way too much.”

Gathercole was asked if there was any temptation to try and stay open, which has been seen in the past by other businesses, resulting in hefty fines.

“The fitness industry is a small world and if someone is breaking the rules and trying to hide it, we hear about it,” he said. “It makes us all look bad and that is something I can’t afford. Training For Warriors does a lot in the community, fundraising for different charitable organizations and we partner with Blood Services Canada. Our name means a lot to me and others. So breaking rules and sneaking people in the back door isn’t something we’re willing to do.”

Lehman says he hopes businesses will follow the rules, but sympathized with their frustrations. 

“I’m the mayor and I can’t ever advise someone to not follow the restrictions. The province has said that this is going to be the law and so everybody in the province needs to follow the law,” Lehman said. “But I would say this: given the 48 hours notice, given the frustration, given we’re heading into the third year of this, I totally understand why somebody may have that reaction (to not adhere to rules). But I could never advise that it is a good thing to do.”

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