And the Waffle House Index almost never hits red.
Well, now it has. More than 400 of the company’s 1,992 locations are closed because of the novel coronavirus. Public-health orders forbidding gatherings of more than 10 people in some jurisdictions have made it nearly impossible for restaurants to operate. Sales are down 70 percent nationwide, Waffle House said in a statement to The Washington Post.
“Hour by hour, Waffle House’s reality is changing,” the company said.
For the first time, the index is being used to measure the impact of a non-weather-related event.
“This week, we posted information on the number of Waffle House closures related to covid-19. We referred to the index as a way to help people understand how big of an impact this virus has had on the restaurant industry,” Waffle House’s statement continued.
“The reference to ‘code red’ also highlights the tremendous impacts that are being felt by many of our associates and their families. With so few customers visiting our restaurants, we are rapidly losing the ability to offer enough work hours for our associates to earn money needed to live their lives and pay their bills,” it said.
That means things must really be bad because Waffle House is one of the companies the disaster-response officials look to as a model of risk management.
The Federal Emergency Management Agency uses the informal metric to gauge the severity of a disaster. The chain is know for its ability to stay open during severe weather events. Supply chains are shored up. Workers are ready to go. Home Depot and Walmart have similar reputations.
“They know immediately which stores are going to be affected, and they call their employees to know who can show up and who cannot,” Panos Kouvelis, director of the Boeing Center for Supply Chain Innovation at Washington University in St. Louis, told occupational health and safety magazine EHS Today in 2011. “They have temporary warehouses where they can store food and most importantly, they know they can operate without a full menu. This is a great example of a company that has learned from the past and developed an excellent emergency plan.”
And thus was born the index, which former FEMA administrator W. Craig Fugate was said to consult regularly. It has been used during responses to hurricanes, floods and tornadoes. For example, when a powerful tornado ripped through Joplin, Mo., in 2011, killing 158 people and injuring more than 1,000, the local Waffle House remained open, and the index green.
But this is the kind of crisis that is not restricted to certain towns or states or even regions. Waffle House’s hardest-hit locations are along the Gulf Coast and in the Midwest, the company said. Most of the restaurants in Florida are still open, though, as are most of the 188 locations around Atlanta.