The Wild Burrito in Wildwood, New Jersey: Beef prices are "through the roof."
By Ed Avis
Editor's Note: This is el Restaurante’s seventh annual Independent Mexican Restaurant Report. It draws on a reader survey in October that was answered by 49 readers, and follow-up interviews with four of them.
At Henry J’s Taco House in Des Moines, Iowa, co-owner Linda Rivas says a lot of the restaurant’s regular customers are back. COVID has eased its grip, and business picking up.
“We have more customers than last year, because people are out and moving about,” says Rivas, whose husband started the restaurant with his parents nearly 50 years ago. “Business has picked up significantly.”
But not everything is rosy at Henry J’s. For one thing, the dining room is still closed, and that’s not because of lingering COVID concerns – it’s because the restaurant can’t find enough employees to properly staff the dining area. Furthermore, food costs are up, and some food items the restaurant sells a lot of, such as jalapeno poppers, are simply unavailable.
“Overall in Des Moines we’re better than a lot of other places,” Rivas says. “But I don’t know when our economy is going to get back to some kind of normalcy.”
The reader survey that informs this 2021 Independent Mexican Restaurant Report reveals that Rivas has a lot of company: Business is definitely better than last year, but a lot of things are still far from normal.
Way Better than Last Year
It’s certainly no surprise that independent Mexican restaurants have done much better in 2021 than they did in 2020. At this time last year, there was no vaccine and most restaurants were open only for takeout and delivery. Now, despite lingering COVID concerns, most restaurants have reopened and customers are happily returning, even if they’re still masked.
The numbers show the story: Nearly 15 percent of survey respondents said their business has doubled or more since last year, and another 17 percent said business is up between 50 and 100 percent. Only about 15 percent said business is down.
Maria Moreno, co-owner of Figo’s Mexican Restaurant, which has three locations in Missouri, says they added a drive-in during COVID at their location in Gerald, Missouri because the dining room was closed. It proved highly popular with customers, and now, even though the dining room has reopened, cars still line up at the drive-through.
“It was probably the best thing we’ve ever added to that restaurant, because people still use it,” she says. “Now we’re busy inside and our to-go business is super busy.”
Finding Help? Nope
Serving more customers normally means a restaurant needs more employees. Unfortunately, finding employees has become a serious challenge. Nearly 95 percent of respondents to our survey said that it’s been harder this year than before to find employees. The other 5 percent say the challenge is about the same as always.
Nicole Marshall, owner of Bueno Tacos in Hamilton, New York, says she used to be able to find new employees easily in her community, which is home to Colgate University and Hamilton College. That’s not the case anymore.
"Normally our town is full of kitchen staff, but just in the last year every restaurant in town is trying to find employees,” she says. “It sounds like a lot of people who used to be in the industry have changed their career paths.”
Like many restaurant owners, Marshall has raised the pay of kitchen positions to $15 an hour, well above the state’s minimum wage of $11.80.
“But we’re still not attracting anybody,” she laments. “I did recently hire somebody for the kitchen but we had to escort him off the property 48 hours later! So I have been doing all the cooking. I’m on the grill from open to close. It makes it hard to do the others things I have to do.”
Rivas of Henry J’s Taco House has the same problem.
“We’re just not getting applications, very few at all,” she says. “Usually we have a whole stack of applications. Maybe only a third of them are good, but we still have options. Now we’re really not getting any at all. It’s not just us – there are help wanted signs everywhere. Even the manufacturers can’t get people to work.”
According to our survey, the most popular way to keep employees happy these days is raising pay: About 82 percent of respondents have done that. Fifty-eight percent of respondents have started offering more flexible schedules, and about 29 percent have created other new benefits for employees.
Killer Food Prices
Another challenge the industy is facing is rising food costs. We have asked readers about food prices every year since we started the survey in 2015, and it’s always a problem, with prices going up for more than 60 percent of readers every year. However, 2021 established a new high that will never be exceeded: 100 percent of respondents to the survey said food prices are up this year!
“The cost of protein has doubled,” says Joe Carpenter, owner of The Wild Burrito in Wildwood, New Jersey. “Beef was through the roof early in the season, and pork has been higher.”
Carpenter raised his prices 50 cents an item across the board at the beginning of summer, and customers did not complain. “I regret not doing a bigger increase,” he says.
Moreno at Figo’s Mexican Restaurant says she previously paid $17 for a 24-count carton of lettuce heads. Now that costs $58. She has coped by reducing the amount of lettuce on certain dishes, such as the quesadilla plate.
“Before we had the quesadilla and a big pile of lettuce, but my husband said, ‘Wash the dishes a little and you’ll realize how much is thrown away,’” Moreno says. “So I did that for three weeks and he was right! People scrape the guacamole off the lettuce and leave it.”
A related problem for many restaurants is product availability. For example, Carpenter says he was unable to get lids for the take-out burrito bowls he uses. “I do a lot of delivery and take-out so that was a hassle,” he says.
Rivas says she has had trouble getting an essential Mexican restaurant staple: corn tortillas.
“My food broker is just saying maybe they’ll have them on this date or that date, but they don’t come,” she says. “I even emailed the company directly and they say the same thing, or ‘We don’t have the staff’ or ‘We’re working on the problem.’ They give you a vague answer. I’ve used this one brand of corn tortillas for years, and all of the sudden we can’t get it.”
Hanging in There
Despite the labor and food cost challenges, the Mexican restaurant industry is surviving. More customers are coming in the door or ordering to-go, and after COVID-ravaged 2020, that’s a tremendous relief.
“I’m pretty positive and hopeful that we’ll get through this,” Marshall says. “The demand is there, it hasn’t slowed down at all. We just have to make it through the challenges.”
Sidebar: What Challenges Us?
One open-ended question in the survey asked respondents what their biggest concerns are. Here is a sample.
We are unable to attract applicants much less retain new hires. We have had openings in the kitchen since April for a Lead Cook, Pantry Cook, and Day Dishwasher, with constant ads on indeed, and no serious applicants. The FOH faces similar issues. And, the labor shortage affects our vendors as well, resulting in more difficulty getting product.
Not being able to predict when we are going to be busy like before, so it's hard to keep the staff that way.
Quedarnos sin empleados y no poder dar el mejor servicio que le queremos dar a nuestros clientes. (Running out of employees and not being able to give the best service that we want to give to our clients.)
When we are short staffed it is extremely difficult to give our customers the service they deserve and expand in any way. Customers also do not understand product availability. Some items we have had on the menu for years just can't be found.
Que volviéramos a cerrar y que aumentaran los impuestos. Me asusta y me preocupa. (That we will have to close again and that our taxes will go up. It scares and worries me.)
The lack of people willing to work.
My only concern is how long do I want to still own this business. I've been in food for 45 years.