What operational changes has Benihana implemented to comply with government safety and sanitation requirements in response to COVID-19?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
rbated by resurgences and the spread of variants of the coronavirus. It remains difficult to predict the full impact of the COVID-19 pandemic on the broader economy and how consumer behavior may change, and whether such change is temporary or permanent.
We have made operational changes to adhere to government requirements on safety and sanitation in our restaurants. However, we cannot guarantee that changes to our operational policies and training will be effective to keep our employees and customers safe from COVID-19. COVID-19 may impact the willingness of customers to dine outside of the home. While it is not possible at this time to estimate the full impact that COVID-19 could have on our business going forward, the continued spread of the virus and the measures taken by governments or by us in response could adversely impact our business, financial condition and results of operations.
Costs associated with mitigating the impact of COVID-19 are significant and will continue in the future. We incurred COVID-19 related costs of $5.8 million and $5.5 million in 2021 and 2020, respectively.
Health concerns arising from outbreaks of flu viruses or other diseases, or regional or global health pandemic could severely affect our business.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, the company has implemented operational changes to adhere to government requirements on safety and sanitation in its restaurants in response to the COVID-19 pandemic. These changes include increased cleaning protocols, such as creating a sanitation role focused on high-touch and high-traffic areas. Benihana also implemented daily health and safety checklists, provided additional personal protective equipment and cleaning supplies, and engaged third-party vendors to perform electrostatic cleaning of their restaurants. These measures are intended to provide a safer environment for both guests and employees.
Benihana, like many other restaurant franchises, has incurred significant costs related to COVID-19. The FDD notes that the company incurred COVID-19 related costs of $2.5 million in 2022 and $5.8 million in 2021. These costs primarily cover sanitation, supplies, and safety precautions taken to prevent the spread of COVID-19. The document also states that the COVID-19 pandemic has significantly impacted, and will continue to adversely affect, operations and financial results for the foreseeable future.
However, Benihana acknowledges that there is no guarantee that these changes to operational policies and training will be entirely effective in keeping employees and customers safe from COVID-19. The company also notes that the continuation of normal dining operations is subject to events beyond their control, including the effectiveness of governmental efforts to halt the spread of COVID-19. Prospective franchisees should be aware that health concerns and potential outbreaks of viruses or other diseases could severely affect Benihana's business and, consequently, their own franchise operations.