Olin prof consults with STL restaurants navigating COVID-19 crisis

In the age of COVID-19, the St. Louis restaurant scene is facing unpredictable trials amidst the federal stimulus bill. But WashU professor Peter Boumgarden is helping business owners navigate this change by working directly with policymakers to clarify what would otherwise be a chaotic, unmanageable economic circumstance.

Boumgarden—professor of practice, strategy and organizations—facilitated a conference call with US Sen. Josh Hawley, a Missouri Republican, and roughly a dozen restaurant owners and staff workers recently. He created this space to offer candid responses to their concerns and questions while working to strengthen the relationship between the state government and local businesses.

Boumgarden is using the same space to provide more information on the CARES Act.

“We’ve gotten further clarity around the support people will get and will give them some clarity on what they should do in regard to their own operations,” he said in an interview with KSDK Ch. 5 in St. Louis.

Their options are either to let employees collect unemployment while they decide on getting a loan; or, to apply for a stimulus package, which would provide two months’ worth of rent/mortgage money and staff payroll. While these are both potentially feasible responses, they also have drawbacks.:

  • The first option is tricky because unemployment assistance is already difficult for business owners who regularly work with the debts that come from their positions.
  • The second option only works if the businesses agree to rehire/regularly pay the same staff for at least two months starting again June 1. However, we don’t yet know when the pandemic will slow down enough to re-open businesses as normal.

Boumgarden elaborates, “The good news is if you believe everything is going to be back to normal in eight weeks — people are going out to eat again — you could essentially get full coverage for these next two months and go back to full operations at that point.”

But no one can predict the widespread response to COVID-19’s wrath: There’s a high chance people won’t feel comfortable dining out or engaging in public activity as usual, at least not at first. This is one of Boumgarden’s primary concerns as he assists in helping restaurants through the economic recovery of the coronavirus pandemic.

 “What I would encourage these restaurant entrepreneurs to do is to be really caring in your communication with your employees,” Boumgarden told KSDK. “There’s a lot of uncertainty and the right choice for one restaurant might not be the right choice for another.”

Watch the full report with Peter Boumgarden on KSDK Ch. 5’s website.

Pictured above: Peter Boumgarden speaks by video to KSDK TV’s Abby Llorico about how he’s working with restaurants coping with coronavirus (credit: screen capture from a KSDK Ch. 5 report).

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