Gotham owner details staffing and inflation challenges restaurants are facing

Gotham owner Bret Csencsitz joins Yahoo Finance Live to discuss the state of the restaurant industry amid the wave of Omicron cases, inflation, supply chain challenges, and labor shortages.

Video transcript

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- Welcome back to Yahoo Finance. Well, the restaurant industry was one of the sectors hardest hit by the pandemic and has been struggling to find its footing ever since. We're joined by someone who knows all too well about the struggles restaurants have been dealing with. We're joined by Brett Csencsitz, Gotham owner. Thank you so much for being with us along with Yahoo Finance's Brooke DiPalma. And Bret, I want to thank you for joining us.

Gotham has been a dining destination for decades, right? I've been there many times as I said in the break during the good old days and always had a great time, very eclectic, very unpretentious service. Not too many restaurants like that in New York, I think. But you were hard hit by the pandemic. You closed at the start of it in March. And the thought was that it would not reopen. But you did recently decide to reopen. And I'm wondering why did you choose to do so because the industry has been so hard hit.

BRET CSENCSITZ: Well, probably a bit foolish to be honest with you. It was I actually decided that I wanted to reopen the restaurant immediately upon closing. My-- the original partners, I was a managing partner, but the original partners who opened it in 1984 really didn't and probably presciently didn't see an end to the pandemic. Me being younger and perhaps a little bit more foolish thought, "Well, this this will be over in relatively short period of time." So I set about reopening the restaurant pretty much in April of 2020.

BROOKE DIPALMA: And Bret, out of my own curiosity, I actually checked on OpenTable to see if there was a reservation for this afternoon, and there was not one available, which is a good sign. But according to data from OpenTable, reservations in New York are actually down 50% so far this week. Break down for us what reservations have looked like over the past few weeks and are there any last minute cancellations or more walk ins perhaps?

BRET CSENCSITZ: Well, the reason you're not seeing reservations for tonight is that we have not been able to open Mondays. So given the labor shortage, one of the things that we've had to do is restrict our dining hours. And so we're not open Sundays or Mondays at the moment, simply because we don't have enough staff. In regards to reservations, this week is looking probably 50% lower than where it should be at this point.

What happened for us is we opened in November. We started to get some momentum. And then of course, we all know what happened in the last seven to 10 days with the onset of this new surge. We saw a dramatic decrease in cancellation-- a lot of cancellations. So we're sort of entering, I don't know what round if this is three or four, of challenges for the restaurant business.

- And can you tell us about food costs? What kind of some, maybe some examples? We've talked to a number of restaurateurs around the city here and elsewhere. And some of the sororities are just shocking. By the way, prices have not only been volatile but also tending to go in the wrong direction there.

BRET CSENCSITZ: Yeah I mean, we've experienced that as well. For instance, we had one of our fish suppliers halibut coming in at $14 a pound one week, and then the next week's at $24. And then maybe it drops to $22. But it doesn't really ever seem to get back down to what we were paying for six weeks or so from November to mid-December. And we see that across certain commodities.

Certainly, beef we've seen increase in pricing, our lamb costs, that's a Lamb dish that's on the screen right now, also a dramatic increase in cost. So yes, we're seeing it primarily in the commodity sector in the meat or a higher end fish end dairy section.

BROOKE DIPALMA: And Bret, really quickly, last week Yahoo Finance spoke to Bo Peabody. He's a board member of the Boqueria restaurant group. And he said that right now, they're having conversations and requiring their staff to have a booster shot might be the only way to go as numbers rise in the city. What sort of conversations are you having with your staff at Gotham? And what could this mean for business when staffing is already difficult enough?

BRET CSENCSITZ: Yeah I mean so last week, you know I spent as Omicron surge started hitting, and we started to see the drop in numbers at the reservations, and then we had a couple of people who called out not feeling well. And of course, there's a regular cold going around. And a lot of people just had that, but we just told them to please stay at home.

When I told everybody that they needed to get their booster, I mean, I didn't mandate it. I'm not demanding it to as a necessity to work here as the vaccine is. So you must have a vaccine to work here, but it's not mandated that you have the booster. I've just encouraged everybody for all of our sake, all of their families' sake, and all of the people that they're surrounded by that everyone should get the booster.

And we saw a dramatic-- I mean, people were coming up to me all last week saying I scheduled it. They can't get it until January because now everybody wants it. But we saw a lot of employees schedule their booster. So I'm hoping by mid-January 80% to 90% of our staff is is boosted as well as vaccinated.

- All right, well, we will have to leave it there. Bret Csencsitz, Gotham owner, we're so glad that you're back. Hopefully, we will be able to score a reservation. And Brooke DiPalma, thank you so much for joining us today.