Serving up a second course

Restaurant closures due to the pandemic produce a glut of kitchen equipment for sale

SAN LEANDRO, Calif. — The pandemic’s heavy toll on the restaurant industry can be seen in Jose Bonilla’s cavernous warehouse, which is packed with industrial ovens, grills, mixers, refrigerators, dining tables and chairs.

Bonilla’s family business, American Restaurant Supply in San Leandro, California, buys used appliances, furniture and other equipment when restaurants close in the San Francisco Bay Area.

“We have an overflow of equipment that’s been coming in,” said Bonilla, whose family started the company more than 40 years ago.

The COVID-19 pandemic has forced tens of thousands of restaurants to permanently shut their doors as dining restrictions keep customers away. But it has also been a boon for commercial auctioneers that buy used equipment and sell them to restaurants that managed to stay afloat, particularly ones that have expanded their takeout business and are eager to snatch up supplies at bargain prices.

“As the pandemic has continued to impact businesses, the auction industry has actually become busier and busier as the economy has weakened, especially in small businesses and in food service equipment,” said John Schultz, a board member of the National Association of Auctioneers.

Schultz is the chief marketing and technology officer at Grafe Auction, a company based in Rochester, Minnesota, that helps restaurants and other businesses nationwide sell their used assets when they shut down.

The company conducted 289 auctions in 2020, up from 203 in 2019, and had its most profitable month in August since the company was founded in 1959, Schultz said.

“It’s a bittersweet thing for me as I see these businesses closing,” Shultz said. “It’s sad for me, but for us it’s been actually a record year” in 2020.

A new report by the National Restaurant Association shows the pandemic’s devastating effect on the restaurant industry, which last year lost 110,000 businesses — about 17% of the nation’s total.

“We’ve never seen that kind of loss,” said Sean Kennedy, executive vice president at the National Restaurant Association. “This is as dire a situation for the restaurant industry in this country as we’ve ever seen.”

The National Restaurant Association is calling on Congress to help the country’s beleaguered restaurants as they negotiate a COVID-19 relief package with President Joe Biden.

“We need specific funding targeted at restaurants or the nation’s second largest private sector employer is not going to be around much longer,” Kennedy said.

Over the past year, Bonilla’s been fielding a flurry calls from restaurants that are shutting down and need to quickly sell their equipment before the next rent check is due.

Unfortunately, Bonilla said, he can’t help most of these restaurant owners because his warehouse is already stuffed with roughly 2,000 pieces of equipment. And he doesn’t have enough workers to pick up, inspect and fix the used appliances.

TERRY CHEA/AP Jose Bonilla Jr. shows a used industrial oven for sale last month at his family’s business, American Restaurant Supply in San Leandro, California. The COVID-19 pandemic has forced thousands of restaurants nationwide to permanently shut their doors.