How chef Ronnie Muñoz pivoted his business after coronavirus halted his plans to open a restaurant

Yahoo Finance Video

January 5, 2021 at 6:17 PM

Ronnie Muñoz, owner of Ronnie's Kickin', joined Yahoo Finance Live to discuss how he pivoted his business plans due to COVID-19 and his outlook for the restaurant industry.

Video Transcript

ADAM SHAPIRO: One of the industries that's taking it so hard during the pandemic, restaurants. I want to bring in Ronnie Muñoz. This is a unique story because he is the founder, the owner of Ronnie's Kickin'.

He's a restaurateur. And just as the pandemic was beginning, you were about to open an actual, traditional restaurant. But then everything got blown up. And yet your fried chicken is now the toast of the town in Los Angeles. Tell us more about how you've been able to succeed with the pandemic.

RONNIE MUÑOZ: I started cooking out of my porch last May. Or I-- yeah, so May of 2019. And as we grew, we were about ready to move in to a physical location in Mid-City in Los Angeles with a few investors. And well, right about when we were about to sign-- and we were going to put in key money as well. So it really did save us a little bit.

I guess part of our success with Ronnie's Kickin' was being the owner and not having to share the decision-making with investors or partners. I guess mainly because my system runs off of just having two employees and me as the chef, being able to run a front-of-house style. My management of the popup gave me the freedom to close when I needed to, lose money when I needed to, and I guess just take the hit and keep on rolling through the punches, you know?

And I guess that really helped us--

SEANA SMITH: Hey, Ronnie--

RONNIE MUÑOZ: --throughout the majority. Yes?

SEANA SMITH: Ronnie, when you talk to your colleagues within the industry-- because this is the restaurant industry. It has been hit, if not one of the hardest industries from the pandemic. How long do you expect the restaurant industry will take to recover? And how many more closures could we possibly see over the next several months?

RONNIE MUÑOZ: I speak to one of my better chef friends, Ryan Ososky. And I guess we share the same sentiment where, if we see another shutdown, there's going to be far more closures come February. You know, restaurants are already struggling just to even pay bills. And I know one of my former employers had to set up a deal with a landlord where instead of being able to profit, it's a profit-share system with the landlord where, I guess, it's like a 30% take that the landlord will receive from sales.

And I don't see any restaurants surviving that. Because I mean, we run on such slim margins where, realistically, if we can get to 20% profit, we're, like, celebrating, and it's a happy dance in the walk-in. But if LA sees another complete shutdown, which I'm expecting February, I wouldn't be surprised to see many of my friends and many of my former employers start to begin to plan to close.

ADAM SHAPIRO: Sure. Ronnie--

RONNIE MUÑOZ: Just because rent is already extremely expensive.

ADAM SHAPIRO: Ronnie, do you expect a reset after the pandemic? Rents to come down? Or do you expect there to be fewer restaurants?

RONNIE MUÑOZ: So I guess it's a little bit of both. I mean, I know that-- I mean, I'm still dealing with finding other physical storefronts. And I know that very soon, landlords will have to begin to compromise where they once expected key money to get in the door and months of rent in advance, I believe we'll see landlords becoming a little more human and understanding of what restaurants need to get in the door and what they need to survive.

And as far as existing restaurants, I can't imagine it being any easier from here on out.

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