Near Camelback and N. 5th St in Phoenix there are two restaurants almost directly across the street from each other. Now a year to date after the coronavirus was declared a national pandemic, one restaurant is making more revenue than they were this time last year, the other restaurant is closed indefinitely.
Two Hippies Beach House is a cute burrito shop that operates as a fast-casual dining experience. Customers can order from the front window and grab their food from the pick up desk within 10 minutes. Los Sombreros is a local chain with three restaurants in Mesa, Scottsdale and until this past December, Phoenix. They operate as a traditional dine-in bar and restaurants that serve Mexican cuisine.
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“Just sitting down and looking at the books, we had eked out as much as we possibly could,” said Bobi Rivera, part-owner of Los Sombreros. After opening in November of 2019, their downtown location was seemingly a success “We had great community support and we were well liked in the area, we were well known in the area. Unfortunately it just didn’t take off like the other locations,” Rivera said.
Rivera said Los Sombreros applied for all the grants they could’ve possibly done but it still wasn’t enough to sustain the restaurant and pay employee wages. While their Mesa and Scottsdale locations managed to receive city funding, the downtown restaurant did not. In order to be eligible for The City of Phoenix Restaurant Resiliency Grant, restaurants had to have operated “a physical or mobile location in the City of Phoenix since Jan. 1, 2019” according to the Arizona Commerce Authority website.
“We were definitely not prepared for a pandemic. I don’t think any restaurant was.” Rivera said.
According to an estimate from the Arizona Restaurant Association between 1,000 and 1,200 Arizona restaurants closed up shop during the pandemic. At its worst point, 80% of the restaurant work force had been laid off.
Across the street from Los Sombreros’ empty restaurant, you’ll find a different story. “All the months past since [March], we’re up from last year.” John Lichtenberg, Co-owner of Two Hippies Beach House said when talking about how the pandemic has affected revenue flow. Before indoor dining was restricted in March, Two Hippies closed for 10 ten days to revamp the inside of the restaurant to make it more functional for social distancing.
Lichtenberg acknowledged that Two Hippies fast-casual restaurant model was key in keeping business flowing throughout the pandemic, “We were set up for this. With outdoor seating and basically a lot of take out, we’ve done really well.
While restaurants had little time to overhaul their business to prepare for only offering take out and delivery, Two Hippies’ quick and easy business model was perfectly suited for a time where diners had no choice but to take their food to go and they were able to draw in customers that didn’t have many options, “With the people that had conventional restaurants they had to shut down or had only 50 percent capacity, we didn’t fit into that category.” Lichtenberg said.
While business at Los Sombreros in Mesa and Scottsdale has started to pick up, Rivera said, the downtown location is shooting for a reopening some time around July.