Pandemic forces business owner to close longtime Elmira restaurant
By Mike Strathdee
The restaurant sector has always had a high mortality rate.
Industry statistics suggest one in 10 new restaurants in Canada, and a much higher number in the US, close within their first year. Only half make it past the five year mark.
Anton Heimpel came close to 25 years of operating At The Crossroads restaurant in Elmira, before the pandemic made him realize it was time to shut the doors permanently.
There had been a restaurant on the site since the late 1980s. Heimpel began working there in 1990 and became owner in mid-1996. Over the years, it was a popular destination for buffet lovers and groups that held breakfast meetings.
But in an industry that measures profitability in a few cents on each dollar of sales, the prospect of extended, uncertain business interruptions spelled the end.
Heimpel knew he should abandon the business in late March, when the second extension of the pandemic lockdown in Ontario was announced. At The Crossroads had been doing takeout for a few weeks, in part to get rid of food on hand, but shut the doors for the last time in early April.
Although Heimpel is a partner in the building, the restaurant was a tenant.
“With no money coming in, with no light at the end of the tunnel, to start making money, there was no way I could see taking on debt for that,” he said in an interview at his home.
A federal government program offering $40,000 loans to small businesses was equal to a two-week payroll at the restaurant, not including the rent or other basic costs, he noted.
“It was so gut and heart-wrenching for us. It was not an easy decision, and not an easy time for us to be going through.”
While some people reached out from their church community, they couldn’t get together with church or extended family. “It’s something we’ve had to bear.’
Heimpel entered the hospitality industry as a part-time,13-year-old dishwasher. He was considering studies to become an accountant when a high school teacher encouraged him to stay in the restaurant business.
One of his first jobs was working for now-deceased Elmira entrepreneur Don Brox at Brox’s Town Village.
Brox did some consulting for Christian Horizons, a charity that works with individuals who have developmental disabilities. At the time, Christian Horizons had its offices in the At the Crossroads building, and briefly operated a menu-based restaurant to provide training for its clients.
In 1990, Brox took over the restaurant, and Heimpel began working for him there.
His apprenticeship through the early 90s involved “doing whatever needed to be done.” Dishes, floor mopping, janitorial work, cooking, salad-making and other food prep were among his early tasks.
Over the three years before he purchased the restaurant, he supervised staff, worked the front cash, seated customers, and answered the phone. “If it got busy, I’d serve tables.”
“I wouldn’t ask my staff to do something I wouldn’t do myself.”
By mid-1996, at age 23, Heimpel was in charge of a 180-seat capacity restaurant.
It grew to seat 240 within a few years. A subsequent, two-year expansion completed in 2008 increased seating to 340.
“A month after we finished construction, we had one of the worst economic downturns since the Great Depression. 08 wasn’t the greatest timing. But we held on and did okay through that.”
At the Crossroads employed between 75 and 85 depending on the season, most part-time.
The business was always highly seasonal. January through Easter were the quietest, roughest months. April would bring Easter gatherings and “you’d start kinda holding your own,” Heimpel recalled.
“September to December you’d hopefully make enough to make it through January, February March the next year. It was a cycle for us. If you managed it right, you could hopefully make it through (the next winter) without borrowing or anything like that.”
Heimpel’s favorite memories of running At The Crossroads include helping couples plan 50th anniversary celebrations, and in one case, a 70th anniversary party.
Being invited to weddings of staff members and seeing their families grow was another highlight. As he and his wife Julie reflected on their years at the restaurant, they could count many couples who met while working there and later got married.
The Heimpels were among those couples. “She was a 14 year-old server. I was a 17-year-old cook when we first met.”
Julie worked at the restaurant through university, getting a degree in social wellness studies and going on to work for several organizations. As the Heimpel family grew, she returned to the restaurant, eventually full time, as a floor supervisor, manager and helping with overall operations doing scheduling, hiring, payroll and bookkeeping.
Heimpel attributes the long success At The Crossroads enjoyed to being attentive to customer needs.
“One of the things we tried to stick to was serving the customer and what they wanted,” he said. “We did a lot of things over the years that other restaurants wouldn’t do.”
Accommodating special diets and offering gluten-free options on the buffet long before that became common were also details that kept people coming back, he said. “We were ahead of the curve on that.”
Hiring staff for their attitude was another key to success.
Customer tastes have changed over the decades. A generation of diners who grew up with access to niche restaurants serving shawarma, sushi, Thai and Indian cuisine, among others, are less likely to have country-style buffet as top of mind.
“I don’t really see in the near future how a buffet restaurant will really hold its place in the marketplace,” Heimpel concedes. “You’ve got so many niche options out there now that having a large buffet restaurant is probably not going to work anymore.”
He is far from done with the hospitality industry, and now works for a Kitchener restaurant supply firm. Asked about the transition to being an employee again instead of an owner, he says: “It’s got its benefits and its drawbacks.”
While he cannot make all the decisions, he can pass off questions from an upset customer to a manager. Having evenings and weekends off and not having to deal with sick employees, burst pipes or other emergencies also provides some peace of mind.
Heimpel doesn’t see himself ever starting another large hospitality business. “There are other ways to use that knowledge and help people who are passionate about it.”
“I think that the position I’ve got right now is a really nice mix, as a street salesman, I’m kind of working on my own, for somebody else.”
“There are a lot of days I can be happy not calling the shots.”
Restaurants face challenges for several years yet, industry watcher says.
Difficult as 2020 was for the hospitality industry, even worse days may lie ahead for large restaurants, says a University of Guelph professor who follows the sector.
“You couldn’t overestimate the (pandemic’s) impact and how horrific the horizon is looking for full-service restaurants,” Bruce McAdams says.
“The problem now is, good operators are going to be going out of business.”
McAdams held management positions in restaurant chains for almost two decades before moving to academia in 2009.
Restaurants that try to operate at 50 percent capacity to comply with physical distancing requirements are lucky to have 30 percent of seating available once they remove tables, he said.
Pandemic realities have completely changed the restaurant experience, he noted. People typically go to a restaurant to get away from life and things that bother them, but “you cannot help (but) be reminded of COVID at every step of the operation.”
Restaurants are cutting back their menus to 50 percent to manage cash flow and the challenges of dealing with inventory if they are required to close temporarily due to the pandemic, he said.
The restaurant industry talks about average profit margins running between three and four percent. McAdams says that statistic is misleading, an average brought down by poor operators. In good times, strong operators have profit margins of between five and 15 per cent, often settling in at between eight and 10 percent, he said.
McAdams doesn’t see much future for buffet restaurants, noting that they “were challenged to begin with” (pre- pandemic.) Buffet clients tend to be older, people who have underlying health challenges even in normal environments.
The all-you-can-eat format is not attractive to millennials and Gen Z (people born in the late 1990s and early 2000s), and will be further challenged by stricter health regulations that will emerge post-COVID, he said. “Buffets really have nothing going for them, unfortunately.”
Hotels have increasingly got rid of their buffet, “and they are not going back,” he predicted, noting that hotels are happy to leave behind a money- losing service.
The collapse of the hospitality industry is having a major impact on employment.
In the US, restaurants used to employ 12 million people. The National Restaurant Association says employment has dropped by two million people, with 100,000 restaurants closed permanently.
Another 40% of operators think it is unlikely their restaurant will still be in business in February if there are no additional relief packages from the federal government, according to a September study by the restaurant association.
In Canada, 800,000 people were laid off during the pandemic’s first wave. Lost jobs in the sector will not be coming back soon, McAdams said.
One possible silver lining in the pandemic may be the fact that the forced closures of spring 2020 gave restaurant operators time that they previously never had to look at their balance sheets and do some strategizing, he said.
The current restaurant model is broken, particularly for operators who lease premises, and many recognize the need for a new model to emerge, he said. “There’s going to be a new model. There’s going to