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Loss Leaders: Restaurateurs Get Their Hands Dirty to Keep the Lights On

Patisserie 46’s John Kraus, Black Sheep Pizza’s Jordan Smith, Yum! Kitchen and Bakery’s Patti Soskin, and World Street Kitchen’s Sameh Wadi on their pandemic return to the front lines.

Loss Leaders: Restaurateurs Get Their Hands Dirty to Keep the Lights On
John Kraus, Patisserie 46. Photos (pre-pandemic) by Caitlin Abrams for Mpls.St.Paul Magazine

A month ago Gov. Tim Walz ordered Minnesota’s restaurants to close their dining rooms and remain open only if they were able to serve customers via takeout. It was a Hobson’s choice for most: Lay off all their employees for an indefinite period of time, clear out pantries, let freezers defrost, ovens cool, and lock the doors; or commit to a course of operations for a trickle of daily takeout orders. It would be revenue, but the ink would surely run red. 

To pull this off, many local restaurateurs who had long been kicked up to “management” have returned to the front lines, taking on tasks they’d long delegated, in hope of keeping the lights on, some paychecks coming out, and maintaining a presence in their community. Here are four of their stories. 

John Kraus | Patisserie 46, Rose Street Café, Rose Street Patisserie, Bread Lab

John Kraus made his name in local baking via his French-influenced bake shop at 46th and Grand in south Minneapolis. By the dawn of 2020 he also operated two offshoots plus a baking school (the Bread Lab) all in St. Paul. The core of his business was a large wholesale operation which sells baked goods to restaurants, coffee shops, and co-ops all over the metro area. 

As many of those businesses closed, “we lost 90 percent of our wholesale customers,” Kraus notes. “I feel like 60 percent of the cancellations came in my email in a single hour. I thought, ‘This is gonna get interesting.’” 

Off the cuff, retail bakeries seem well positioned to thrive in the lockdown. Quick transactions, no lingering, food that is difficult to prepare at home. But Kraus had a problem. His young staff “was terrified. Cash transactions were scaring people. People were crying, throwing-up out of anxiety.” Many of them simply didn’t want to work. 

Kraus and partner Elizabeth Rose decided to condense operations. They closed the Rose Street Café on Snelling in St. Paul and the other retail operations on West 7th. Operations were reoriented around Patisserie 46, but orders would only be taken online and customers would not enter the store. “So it was the same people all the time in the building,” Kraus says, “and the remaining staff felt safe behind the walls.” 

Kraus is down to 14 employees from 47 and has dived-in where needed: “I scoop cookies, I deliver bread, make sandwiches. It’s been a long time since I made a batch of cookies, but I still got it!” P46 has slimmed down its menu but is still offering an array of baked goods from breads to cakes and café items such as sandwiches and quiche. He is unsure about whether he will dive immediately back into retail when the lights turn green. “People need to feel safe, first,” he says. “I feel we’re at a sustainable position for the time being.”

A while after we talked, Kraus emailed summing up his thoughts. He said he did not mean to sound tentative about his commitment to his craft and his customers. “A baker needs to bake regardless of the situation.” he wrote. “I would imagine we will all keep going. Bread is so much more powerful than we give it credit. So I’m going to sleep knowing that when the alarm goes off, I’m getting up and baking. That’s what we do and we will figure out how no matter what.”

Jordan Smith | Black Sheep Pizza

Jordan Smith was a celebrated restaurant chef for many years in the Twin Cities who struck out on his own to found Black Sheep Pizza when the North Loop was still a backwater. His coal-fired pies caught on and afforded him the opportunity to expand to Eat Street and downtown St. Paul. What could be better than to be a pizza maker in a pandemic? It’s the ultimate takeout food. 

Turns out it’s not so simple. Smith closed Eat Street after it didn’t generate sufficient takeout sales to justify the staff he needed there to operate. The two downtown locations soldier on, but at 40 percent of normal volume. “We’re not making any money, trust me,” Smith says. “We wanted to keep as many people as we could employed.” Smith laid off over 90, he has 20+ still on payroll. 

“I’m running crowd control during the dinner rush, unclogging sinks, being present, helping people feel cared for,” he says, echoing a common theme from owners—that customers and employees expect their presence. Smith says he is still paying vendors, and working with banks and landlords in an environment where it’s hard to predict the future. 

Black Sheep has an exclusive arrangement with Bite Squad for delivery, but notes the service is often short of drivers. He calls his arrangement “competitive,” but confirms, in keeping with a recent backlash against delivery apps, that they take a “commission” on each restaurant sale that is often near 30 percent. 

For diners concerned about the sustainability of local restaurants in the pandemic and post-pandemic period, the best course is to pick up your takeout meal and keep its revenues in the restaurant’s cash register. 

Patti Soskin | Yum! Kitchen and Bakery

Patti-Yum.jpeg

Patti Soskin didn’t spend a lot of time pondering whether her St. Louis Park and Minnetonka quick-service bakeries and restaurants would remain open after St. Patrick’s Day. “My gut instinct was to stay at it,” she says. “We’re a community restaurant. We’re here for our neighborhoods. We’re a place people gather to celebrate and in times of hardship.”

Yum! did a substantial grab-and-go and takeout business pre-pandemic, but it was not the core of its business. Her long-tenured employees and regular customers know each other by name and though they currently do a lot of food running to cars, the Yums remain open for customers to say hello and pick up an order in person. 

“I’m working the floor, doing a lot of running to cars,” she says. Soskin or her husband Robbie are at the Yums from open to close. Prior to the pandemic she was working five-day weeks, only daytimes, “but I think it’s important to be present right now for our team and our guests.”

Soskin has laid off staff and lost one to health concerns, but “the people who are here really want to be here,” she says. “We’re a team and we are all in this together.” She says random customers have come in in recent days with large “tips” of several hundred dollars for her team. “We’re working our asses off,” she says, “but everyone is fueled by it.” (Yum! offers all its employees, including those furloughed or laid-off, a meal each day if they choose to partake.) 

Soskin says Yum! is running at about 30 percent of normal revenue, which is not a sustainable model. “It’s been hard to get in a rhythm because each week has been different, from restaurants closing, to stay-at-home, to Passover then Easter, we’ve not really settled into any patterns.”

Yum! doesn’t currently offer delivery or work with delivery apps, but Soskin is looking at adding it for the duration of the pandemic, though she is concerned about the large bite of each sale the apps take and its incongruity with Yum’s business model: “Part of what sustains us is the relationships we’ve created with customers and I don’t know how you get that with a delivery app.”

Sameh Wadi | World Street Kitchen, Milkjam Creamery, Grand Catch

One-time fine dining chef Sameh Wadi operates a diversity of food businesses across the metro area, and when the pandemic hit he faced a diversity of realities. 

His Grand Catch on St. Paul’s Grand Avenue near an emptied out Macalester College, specialized in seafood boils geared to dig-in communal dining. World Street Kitchen in Lyn-Lake serves global recipes born on the WSK food truck, while neighboring Milkjam is the neighborhood scoop shop. 

Wadi and team decided after a few days selling down pantry items that Grand Catch was not suited to takeout and the operation is closed pending what’s next. He says the restaurant was having a great winter prior to Covid-19. Milkjam soldiers on, but is only offering prepacked pints of ice cream and business is off an average of 55 percent in what is normally a slow season for frozen treats. The WSK food truck awaits the season, however that comes. 

But World Street Kitchen hums along at about 50 percent of normal business. “We’re set up,” says Wadi. “It’s basically a menu created on a food truck” where nobody eats in.

One of the peculiarities of the pandemic is there is very little business for restaurants outside core dinner hours, as if the whole world wants to eat at 6 p.m. The biggest challenge Wadi’s team faces is the transition from a day of sales spread out over a dozen hours to serving half his normal volume in “three solid hours of business” the core of which is between 5 and 7. “It’s a crush, for sure.” 

Wadi says his goal all along was “getting hours for staff who wanted to work. We were able to keep a majority of staff on payroll.” Wadi has taken on a number of atypical roles, including being World Street’s baker. “I’m basically doing the shit no one else wants to do.” 

Adam Platt is TCB’s executive editor. 

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