Soon after the state’s shelter-in-place order, a Southern California branch of the Gen Korean BBQ restaurant chain started receiving takeout requests from regular customers who couldn’t find any meat or produce at their local grocery stores.
So instead of keeping its doors closed amid the coronavirus pandemic — the original plan for Gen’s 11 restaurants, according to its chief operating officer, Steve Hwang, one of the state’s most successful buffet-style franchises converted its kitchens into discount meat markets.
A Gen restaurant in Oxnard, a small city west of Los Angeles, began selling beef brisket for $9.95 per pound and galbi for $12.95 per two pounds. As orders multiplied, the company converted two more locations to low-rate markets, rehiring a dozen workers in the process. If demand stays strong, Hwang said Gen might continue serving to-go items post-shutdown. But even with the new success of the meat market, these orders generate less than 10 percent of the sales revenue they made before. He said with the losses, they might have to reassess and shut down some of the branches once the guidelines have lifted.
“It’s not really about making a profit,” Hwang told NBC Asian America. “It’s to help our community during this tough time.”
In the past decade, all-you-can-eat Korean barbecue joints have become a staple across Southern California, where gobbling up unholy quantities of sizzling, grease-drenched pork belly while emptying several bottles of Soju has become a weekend tradition worth the two-hour wait.
But the pandemic has been particularly brutal toward the barbecue industry.
Restaurants were already running on razor-thin margins, and unlimited portions of frozen, marinated proteins can't be easily packed into styrofoam boxes and delivered miles away, making it difficult for Korean barbecue to transition to the new world of takeout.
“We don’t have a lot of reserves even when the economy is good,” Hwang said. “Now we’re devastated financially.”
Nearly a month into California’s shutdown, which includes the closure of all dine-in businesses, many all-you-can-eat Korean barbecue restaurants have shuttered indefinitely. Some, like Gen, have switched business models, while more expensive eateries that serve only a la carte items, such as Soowon Galbi in Los Angeles and Mo Ran Gak in Orange County, have already incorporated takeout into their operation.
“The general consensus in the business is that we’re just trying to break even for labor costs,” said Michelle Kang, the general manager at Bulgogi Hut, one of more than 20 barbecue spots in Los Angeles’ Koreatown.
Unlike Gen, Kang said, Bulgogi Hut isn’t selling raw meat because of the potential health risks. Instead, it’s offering takeout and delivery for items such as kimchi fried rice, chicken skewers and bento boxes. Kang said she receives about 10 orders a day worth $200 to $300, which is less than one-tenth the average haul from barbecue sales.
The profit deficit would likely grow after Los Angeles County extended its stay-at-home order to May 15. Even then, Kang said she isn't sure if she would be able to open shop right away if the county imposes strict social distancing rules. Bulgogi Hut, like many Korean barbecue restaurants, has a fixed dine-in setup that doesn't allow for a lot of personal space.
Since the shutdown began, Kang has cut her staff from 65 full-timers to seven part-timers. “We’re pretty much running bare bones right now,” she said, adding that she recently applied for a small business loan under the new paycheck protection program.
Even before the shutdown, many Asian restaurants saw business decline. Sales at some Southern California eateries have been sliding since the end of January, when the first coronavirus cases were confirmed in the state. At Incheonwon BBQ House in the city of Garden Grove, for instance, revenue fell by 50 percent in February, Stella Moon, whose father owns the restaurant, said.
By the time the state announced the closure of dine-in service, they had had no cash flow to transition to a to-go option. The night before they closed shop, the Moons hosted a potluck for their employees to boost morale and finish up unsold meats. They’ve yet to figure out a path forward.
Many restaurants see their foray into takeout and delivery more as a community service than a viable way to stay financially afloat.
“In a business sense, closing down might have been a better idea,” said Chris Park, the general manager at Shik Do Rak, which sells raw meats, uncooked rice and soju at two branches in Orange County.
Installing a to-go option incurs additional operations costs, from packaging to delivery fees, Park said. The revenue from take-home orders so far doesn’t even cover rent.
The main reason his family kept the restaurant open, Park said, is to give customers a memory of life before the pandemic, and to pay the 15 workers they were able to retain from the original staff of 65.
Park said he’s most worried about the economy post-quarantine.
Even after restaurants reopen, many customers won’t have the money to eat out. Despite mounting difficulties, Park hopes that Shik Do Rak — and the service industry as a whole — will pull through.
“We’ve been in the business a long time and the economy has tanked before,” he said.