Open For Takeout: Part 6: A Restaurant’s Journey Through The COVID-19 Pandemic

In this six-part series, I check in weekly with chef and owner of XO Restaurant Kenneth Lee. Lee shares his struggles, strategies and theories as he attempts to navigate his restaurant and staff through restaurant apocalypse. This is our final interview. 

(Read part 1, part 2, part 3, part 4 and part 5)

It is a sign of the times when you order XO Restaurant’s imaginative, technique driven menu and it comes served to you deconstructed in an aluminum pan. 

But, if that is what is needed for them to stay in business so be it. 

Most restaurateurs are facing a harsh reality right now: accepting that they will have to close their doors forever. Only one in five restaurant owners think they will be able to survive this pandemic, according to a recent survey taken by the James Beard Foundation. 

Lee was smart to have always based his business decisions from a scarcity standpoint. This strategy has enabled XO Restaurant to sustain. That, and his creative ideas. 

Last week, after a few days of record low sales, Lee ordered a 67 pound ‘ahi and threw a poke bowl contest between himself, his chef de cuisine and his sous chef.

Each customer got a bowl with all three pokes and they voted for their favorite on Instagram. The winner’s poke went on to the next round and the other two chefs had to create new ones and compete again. 

The contest turned out to be just what Lee needed in order to create buzz again. XO doubled their sales on the first day of the contest and tripled them on the 2nd day. 

In our final interview Lee and I discuss what he thinks about the spike in sales from the poke contest, why he thinks this year will be their busiest Mother’s Day yet, his prediction for what people will do when they can start dining out again and his advice for struggling restaurateurs. 

Timeline: 4/25-5/2

Q: You guys sold out the first fish in like a day and a half right?

A: Yeah. 

Q: So, how many [poke] bowls was that?

A: The math came out to 49, but I forgot to count in the weight of the sauce, so it was probably closer to 55. 

Q: I was just thinking how last week when we talked it almost seemed like you were kind of getting jaded on trying to be innovative. You were saying that it only results in an increase in sales for a day or two and then it drops again. But, now it seems like you’re getting back to being innovative again. 

A: No, still the same. This temporary boost, I don’t forecast it to be sustainable. We’ll see how this second fish works. “Cause … I’m 99 percent sure this second round is going to be less popular than the first one. 

Q: You never know, it may start something. It was pretty fun. I haven’t seen anybody else do anything like this yet. I mean, a lot of people are coming up with some really creative specials, but nobody is doing fun things like contests within the staff. 

A: Yeah. For example … of all the 50 people that came in yesterday, let’s say, I don’t know what percent, but I’m pretty sure that a certain percentage of them hadn’t had a poke bowl in, like, a week or two weeks or three weeks or whatever, and that’s the reason why they saw it and were like, “oh it’s interesting and I haven’t had a poke bowl in a while.” 

But, if you start pumping out new poke bowls every other day then obviously they’re not gonna come eat poke every day. So, I think the first one kinda cleared the people who didn’t eat poke in a while. 

Like, everyone has different reasons for coming here. It could be to support us, it could be because they haven’t had a poke bowl in a while … there’s so many different reasons. Where I think the first round kinda sucks up all the energy from the people who came for a specific reason. That was a one time only thing. And then it kinda has to cool down for the people that were willing to come back and get another poke bowl. 

Q: What’s cool is that you guys are offering new flavors every time though. This is only the second time, but still, that’s the fun part. So, even though it’s the same dish it’s a completely different flavor profile, so it’s like a new dish. How long do you think you’ll keep this going if the sales continue the way they do?

A: I mean, if it keeps selling then we’re going to keep making it. 

Q: And will you keep doing different flavors?

A: Yeah. The thing is the reason the first one sold so fast was because we kinda said like, “Hey, this fish came in today, we cut it and then it’s on your bowl already.” But, if we don’t sell it fast then it’s not going to be a new fish every day and people are going to know the fish is getting older. 

Q: It’s still exciting though. I think people are getting antsy and bored. So, any cool little thing like this really sparks some joy in people. I mean it definitely did for me, I was like, “Oh, that sounds like fun, I’ll go down for that!” You know?

A: Yeah. I think people like coming in the restaurant and seeing other people here for the same thing and I think people like posting it on Instagram and then sharing their stories, so that other people can see that, like, they’re part of, like, the thing that happened. 

Q: Yeah. It’s connection right? And that’s what we’re all lacking right now is feeling connected to one another. 

A: Yeah. 

Q: Do you believe that innovation and variety are still the secret to your success right now?

A: To a certain degree. But, success is always in relationship to everything else. 

Q: As far as doing things like the poke contest, is this, I mean I know you were trying to look for something to do with your fish, but also is it more about keeping your staff engaged to be creative or keeping customers engaged and coming in?

A: I would say both, ‘cause the reason I got the fish was because I remembered a couple months ago Harry said he wanted to get a fish in and he wanted to practice filleting a fish. 

But, he didn’t even cut it so, [laughs] I learned how to cut an ‘ahi. 

Q: [laughs] Well, then you’ll get another one! 

A: Yeah. But, we’re already starting to do prep for Mother’s Day, ‘cause that looks like it is gonna hit the fan real hard unless we start now. 

Q: Oh, cool! How are sales going? Have people already started to order? 

A: We sold 24 so far. And that’s still eight days out. 

‘Cause the thing that’s hard to gage is how close will people get until they’re like, “Oh, s—-, hit the order button.” 

So, this might be actually only like 10-20 percent of the total that we’ll actually sell, but we don’t know how the curve is going to take. 

Q: Mother’s Day is the busiest day of the year for most restaurants. Do you think that will hold true this year? Do you think that people will get takeout for Mom or do you think that they will cook this year?

A: Oh, yeah. Nobody’s gonna cook. Unless you’re a chef, you don’t cook for your mom on Mother’s Day. [laughs]

It’s kinda like saying, “I could cook, or we could have this professional person cook, but it’s just Mother’s Day, so I’ll cook for you.” [laughs] You don’t say that to your mom. 

So, I think that no matter what, everyone’s gonna ball out in some way. If they can’t afford to do takeout then they’ll ball out and go, like, get an expensive piece of meat or something. I think people will stay within their price range. 

Q: So, you think restaurants will still get hit nice and hard then on Sunday?

A: Yeah. I don’t think it will be even though. Because I would say that this Mother’s Day has the potential for us to make the most money ever compared to all other Mother’s Days. Because there’s a soft cap on how much we can do, whereas with the dining room you have a hard cap––we can only do 100 covers a day. 

‘Cause each pan is equal to six covers, although we’re not making as much money ‘cause, like, a dining room customer would probably spend $60-$70 per head, but then our pan thing is only $33 dollars, so it’s like half. 

So, like, our cap in the dining room is 100 covers, or with takeout we would have to do 200. So, 200 divided by six is 33, so if we do 33 pans our sales will be equal to a maxed out dining room and if we’re already at 20 something now then we’re going to blow it out of the water. 99 percent. Because we only have to sell six more and then we’ll be equal to a full dining room already. 

So, it’s kinda like a game of chess, because it’s us versus other restaurants. 

Everyone’s gonna get, like, “Oh, this is my favorite restaurant I’m ordering from them no matter what,” but because Instagram is such a, uh, you can see so many different people’s offerings, people are going to compare them side by side. Like, this plate for $40 and you get four scallops and five ounces of steak and a lot of vegetables, potatoes and rice or you get XO’s pan for $33 a head. …

… And since it’s not a dining room … I don’t know if other restaurants are limiting their numbers … but, we’re going to have a really soft cap. If we can do it we’re gonna do it, so if we have to do 100 we’ll do 100. 

Q: Yeah. I think most people will be like that this year. I don’t think anyone’s going to turn away business, like, they will make it happen. 

A: Yeah. That was also my reasoning for being a really, really good deal because you absorb a bigger percentage of the market. ‘Cause I saw a lot of places doing $65 a head, $70 a head …

Q: I think a lot of people are doing the $75 a head range … yours is what? $33 a head? That’s great ‘cause you’re capturing everybody else who can’t even get close to that range right now. 

A: And it has, like, a massive variety of like semi-expensive things. …

… We’re gonna temper everything. … We timed it, so if you just chucked it in the oven for 10 minutes everything will come out at the right temperature. 

Q: That is brilliant. Because, also, if you had all these different components that had to be heated up separately you need different pans, so it creates all these dishes. 

A: Yeah. And then people aren’t fast enough. Like, they’ll be, like, opening the oven and closing it like 20 times and it’s just a whole s—- show. [laughs]

Yeah. So, I put it in the pan so all they do is put it in the oven and take it out. That’s literally all they have to do … and then the bunnies are separate, you just throw those in the microwave. 

Q: Are any of your guys getting overwhelmed with all of the different offerings that you have right now going?

A: No. It’s still relative. They work harder during normal service then they do now. It’s a lot of different stuff, but the workload is less than normal service. 

Q: What is your plan when restaurants are able to reopen, but they’re only going to be able to seat a partial dining room? I almost feel like it’s better to keep the takeout the main focus. What do you think? Because you’re not going to be able to make that much money if you’re only seating four or five tables at a time. 

A: Well, the guidelines is six feet apart for social distance, so I’m assuming they are going to translate that to tables also and six feet apart for tables isn’t that hard. ‘Cause tables naturally need to be that far apart already, so you’re not like sitting on top of somebody else. 

Q: How many feet apart are yours right now?

A: They’re not 6 feet, but, like, all the edge tables you can push it up to the wall and then we can kinda put some tables in the hallway and put some up by the front bar by the windows, so we can just spread the tables out more. …

… so they’ll be facing a wall, but at least they get to sit.  [laughs]

Q: They will be happy that they are out! So, I think they’ll be fine with that. … Do you also think you will keep takeout as a big focus too? Because, I think a lot of people will still be hesitant to come out. 

A: The thing is, for takeout, like, the percentage of people doing takeout out of the whole population that would have went out to dinner is such a small percentage anyway. 

I’d say before, 90 out of 100 people went out to dinner once a week. I’d say now, there’s only, like, 10 of that 100 going out to do takeout, ‘cause most of them are just cooking at home. So, it’s such a small percentage that it’s not really worth.

Like, we always do takeout naturally, so that’s always, if people want to do it then they’ll do it, but I think most people will want to eat in the dining room. 

Since I serve so much, like I’ve been serving five or six days for the past almost a year now, that some people come to eat for one reason and I think to see me is another reason. [laughs]

Q: [laughs] Are these friends or regulars? 

A: Regulars. 

‘Cause I think a lot of people that came in to eat before was like, “Oh, I got the chef as our server!” [laughs] And that, like, never happens, so I think that’s why they’re like, “Ahhhh!” [laughs}

Q: It is kinda fun! So, what do you miss most right now with this pandemic.

A: People. 

Q: If you could have a dine in experience anywhere right now where would it be?

A: Rigo. But, anywhere will do. Even if one restaurant just opens and it’s really s—-, but you just went in there just to be served, I would go there. 

Q: Do you have any last words of advice or encouragement for other restaurant owners that are struggling out there right now?

A: I think the advice that would help each restaurant is different. I could give my advice that would work for me, but it won’t work for them, because they just don’t have the capacity to do that type of stuff. 

Like, some restaurants are built to be white table cloth and whatever and they’re range of what they can do is different from a mom and pop store like No Name down the street, which pretty much was already exclusively takeout anyway.

Everyone’s in a different situation and utilizing your advantages as much as you can and trying to soften the blow on your disadvantages, like Waikiki, they’re paying so much rent and they probably have so much square footage in their huge dining rooms that seat like a hundred something, that they’re just like bleeding. But, if you could somehow, like, utilize the space then that’s my advice to them. 

Q: What are the questions that people need to ask themselves then? What do they need to sit down and think about?

A: Cutting their losses now rather than a couple months down the line when they’re completely broke and they have sold their house and all that …

… Like, if you can outlast, if you know you have enough money to outlast it, then good, keep going, make the best of it. But, if you’re on your last leg, just cut it already or it’s just gonna be a slow painful death that sucks your bank account dry.

Which I know nobody wants to do, because nobody wants to open a business, run it for years and then just be like, “OK I guess we just have to give up now,” because that’s, like, their baby. 

But, that’s just how it is. If it doesn’t make sense it doesn’t make sense. If they were already hurting pretty bad before all of this stuff happened, like, cut your losses now because this isn’t going to fix itself overnight. 

Has advocating for restaurants to get government assistance and ordering takeout become our civic duty? Is it our moral obligation to help the mom and pop spots that built our communities and introduced culture to our neighborhoods survive? 

There are ways we can help that include calling your local congressman, donating to campaigns that support independent restaurants and purchasing gift certificates and takeout. 

As for Lee, a good leader constantly keeps his tribe alert, so that they don’t get entangled with distractions–both external and internal–along their journey. 

Lee enjoys the excitement of coming up with a new offering that does well. You can see it all over his Instagram feed. But, his biggest strength is knowing that these moments are fleeting. He stays open to new ideas and keeps moving forward never getting attached to any particular one. If they work, great. If they fizzle out, then on to the next. 

So maybe it is this unattached, unending forward movement that is his secret or maybe it is the way he continues to find ways to make the impossible possible. Either way, it appears XO Restaurant is going to be OK.

This conversation has been edited and condensed for clarity.