Why is a business like this shutting down for good?

[cottagecheesefan]

https://www.thestar.com/opinion/sta...AkIvu3xdVLcnH9fGdMrnpeod8esVQFV_9uGyq0kc0a6xM

Suppose to be the best Pizza place in Toronto. I have 2 friends in Toronto who both posted this on Facebook.

But there is not reason given to why it is closing... it just says because of COVID-19?

Why would the best pizza place in town close for good? It says they have lines of people outside to get their last pizzas, they are doing take out, etc.

"We will dearly miss working alongside you every day. The decision to close was a difficult one, but like many restaurants, our business has been affected by the COVID-19 crisis."

Having to do takeout for a couple months causes a place like this to close for good? Doesn't make any sense.

 

[SalvadorAllende]

Maybe people is cooking more and buying less in order to save money and sales are down?

 

[cottagecheesefan]

Maybe people is cooking more and buying less in order to save money and sales are down?

I get that, tho they said they had long lines of people trying to get their last pizzas.

But why wouldn't it be a temporary closure? Aren't these people going to need jobs after COVID-19? It isn't like they are doing to start a new career during COVID-19. If nothing else, sell the business after COVID-19.

 

[melvinj0]

Maybe they were struggling beforehand too

 

[Not A Theist]

"The Best ____ in _____" doesn't always mean they have the best business model. Quality costs, people have expectations about maintaining historic prices even as production costs go up meaning the business can't effectively up their prices, labour costs, more bylaws, online competition, etc. There's a reason shit like Domino and Pizza 73 have done well, and it's not quality. Sadly, with crappy alternatives like that, getting charged an extra 50 cents per slice for a pizza that costs twice as much to make will probably drive a lot of customers away, so the consumer's utter cheapness is likely hugely culpable here. What's more, sometimes smaller family run type businesses simply end when the kids don't want to carry it on. Add in extreme financial stress, and "The best _____ in _____" may finally have their unstable business model finally overtaxed and then that's it.

 

[SalvadorAllende]

I get that, tho they said they had long lines of people trying to get their last pizzas.

But why wouldn't it be a temporary closure? Aren't these people going to need jobs after COVID-19? It isn't like they are doing to start a new career during COVID-19. If nothing else, sell the business after COVID-19.

Maybe they were looking for a way out and this gave them an excuse at a lower cost than usual? IDK.

The biggest steel company here, which is very sustainable (owner is richest guy in Argentina with 8B USD) was trying to laid off 1,400 employees after 2 weeks of quarantine claiming he could not pay the salaries. LOL.

 

[NoGoodNamesLeft]

Restaurant businiess is an inherbently failing venture on aong ednough time line

 

[mjmj]

Yeah, seems clear they were planning to close anyways. This just hurried them along a bit.

 

[TheWobbler]

Maybe the owners have had enough and used covid 19 to close up and retire or try something new.

 

[jx820]

Takeout may not pay as well. Selling Pizza may be a relatively small part of a pizza places business model. If you are paying rent on a dining room you can't use, and losing upsell items like desert or cocktails that people generally dont take out that can hit hard. I don't know their model, but if your expenses surpass your revenue, any business can fail.

 

[dildos]

Sad!

 

[Fluffernutter]

"The Best ____ in _____" doesn't always mean they have the best business model. Quality costs, people have expectations about maintaining historic prices even as production costs go up meaning the business can't effectively up their prices, labour costs, more bylaws, online competition, etc. There's a reason shit like Domino and Pizza 73 have done well, and it's not quality. Sadly, with crappy alternatives like that, getting charged an extra 50 cents per slice for a pizza that costs twice as much to make will probably drive a lot of customers away, so the consumer's utter cheapness is likely hugely culpable here. What's more, sometimes smaller family run type businesses simply end when the kids don't want to carry it on. Add in extreme financial stress, and "The best _____ in _____" may finally have their unstable business model finally overtaxed and then that's it.

Which is why when the social distancing is done, Applebees and Oliver Garden will replace mom and pop restaurants across the land.

 

[Streeter]

In Chicago I'm hearing half or more of the restaurants will close. I didnt believe it at first. Now not so sure.

 

[Not A Theist]

Which is why when the social distancing is done, Applebees and Oliver Garden will replace mom and pop restaurants across the land.

The funny thing is, even big guys like that will likely become the small guy soon enough. We've seen it with supermarkets. Local farms selling directly, butchers, delicatessens, and dedicated vegetable markets get beaten out by supermarkets. Supermarkets eventually get outcompeted by megamarkets (Walmart types). Walmart types may eventually lose out to online sellers. The little guy gets beaten by the big guy, who gets beaten by the huge guy, that then gets beaten by the online goliath. What happens when to Appleby's when Amazon opens its twenty minute drone delivery Feedazon service? Just like now I see people saying "We need to save Safeway from Walmart and Amazon!" after Safeway killed the local delicatessen, we'll eventually see people saying "We need to save Appleby's from Feedazon!" The smaller alternatives just slowly get shuffled out of the business world as they get less and less able to compete due to ever increasingly regulation, lack of anything resembling customer loyalty or genuine willingness to vote with their wallets, or black swan events like we're seeing now.

There's an inexorable tide of huge change in how we buy and sell things happening, and a lot of our short sighted, sometimes even well meaning, practices are helping them along.

 

[dc007]

Maybe they were struggling beforehand too

This is why. If your business is already skating by and then you lose a large amount of revenue, you can't stay above water.

 

[Herwald]

Most people live paycheck to paycheck, why would small to medium businesses be any different? Banks don't give a shit that you have problems. Pay up.

 

[tmnpothead]

Maybe people is cooking more and buying less in order to save money and sales are down?

I know in America my pizza place is busier than ever, especially after people got their damn stimulus checks in.

 

[ocfightfan]

Because being the best is not a guarantee of success. It helps, but there are many other factors that can help or hurt you. People are cutting back spending because of the uncertainty. Maybe they were running on super thin margins for some reason or had too much debt from bad decisions or things that didn't pan out for them.

 

[Otto!]

Restaurants make good profits from beer and alcohol sales too. That’s no longer available when you do takeout only.

 

[CrimsonFan]

Man it's crazy how little the average person knows business and restaurants in general.

These places arent making a shitload of money. They float. I always tell people this in the tipping threads where people want establishments to pay decent wages and abolish tipping. The average restaurant barely scrapes by. And none of them last forever. They probably were losing money like crazy and made the decision to get out while they still can without going into debt