Gift vouchers give cash-strapped restaurants a fighting chance

Cash-strapped cafes and restaurants are receiving vital funds from customers buying gift vouchers during the coronavirus lockdown that can be cashed in when the businesses reopen.

Keep Them Open, a new not-for-profit online platform founded by two young entrepreneurs, is connecting customers with cafes and restaurants selling gift vouchers to use down the track.

For struggling food businesses that are either closed or operating as takeaway-only ventures, gift vouchers can provide a vital cash injection upfront. Customers can then cash in the voucher for a meal once restrictions ease in coming weeks and months.

Co-founder Tom Alder said he wanted to have a "real impact" to help out the sector.

"We're both massive foodies and we've seen too many foodies close their doors in recent times. Lots of people have lost their jobs including our housemate," he said.

"We simply redirect traffic - replace lost foot traffic with web traffic."

People are honestly buying these vouchers to support us and support the industry.

Robin Butler, Rolling Penny

Other similar gift card schemes include Save Hospitality and The Fork's Save Our Restaurants website.

For Michael Coates, co-owner of Northcote restaurant Mexican Street Food in Melbourne, the vouchers help provide funds when it's needed most and are an important "piece in the puzzle" for his business as it navigates its way through this crisis.

Mr Coates's restaurant was very much geared to dine-in customers, so he has shifted the business model to embrace takeaway, which previously comprised just 5-10 per cent of revenue. However, he has shunned delivery companies such as Uber Eats that take about a third of revenue and can compromise quality.

"The food we do isn't well-suited to being turned sideways and upside down by delivery riders," Mr Coates said. "We're trying to balance keeping the money coming in the door with not doing our business more harm than good in the long term."

He said gift vouchers are "a really nice way for some of our customers to look after people they knew going through tough times and looking after us at the same time".

Robin Butler is co-owner of Rolling Penny cafe in Sydney's Newtown and said the past two months had been chaotic and stressful.

He was forced to drastically transform the fancy dine-in brunch menu to be takeaway only, something he says caused "a lot of sleepless nights".

After being approached by Mr Alder and setting up his cafe to accept online vouchers, Mr Butler said customers had purchased $1000 of gift vouchers in three days.

"It's definitely helped us out, it's made things a lot easier," he said.

"A month and a half ago, every order you put in was risky. [Now] if you have an upfront payment you can cover your bills."

Getting some cashflow has relieved some pressure on the business, but also reduced stress for Mr Butler personally.

"I'm the happiest I've been in a long time."

Mr Alder admitted there was a risk some businesses would not survive the shutdown period, and encouraged people to read the terms and conditions carefully.

"As a social enterprise we can't guarantee those vendors will stay open or refund those gift vouchers."

Mr Butler said while he was confident Rolling Penny would survive the crisis, he thinks his customers would understand if their gift voucher was unable to be redeemed.

"I think people are honestly buying these vouchers to support us and support the industry," he said.

"I really don't think you'd get a backlash from it. It's people coming together to rally around local businesses. People are doing it out of the goodness of their heart."

Mr Coates acknowledged gift vouchers were a "double-edged sword" because the upfront cash meant providing the service down the track for no income.

"We're planning on being here for the long haul. But from a consumer perspective absolutely there's a risk."