The plant-based French eatery Delice & Sarrasin in the West Village is struggling to cope with the impact of congestion pricing in New York City. The owner, Christophe Caron, believes that the high delivery surcharges imposed by distributors due to congestion pricing may force the 12-year-old restaurant out of business in the next three to six months. Two of Caron’s suppliers have started charging $10 in surcharges for each delivery, and he estimates that he could end up paying up to $2,000 to $10,000 by the end of the year.
In addition to the congestion fee-related surcharges, Caron is facing increased ingredient costs, with a 40-pound bag of dark chocolate seeing a $300 price increase in the last three years. Furthermore, the lingering impacts of the pandemic have resulted in a decline in customers eating out, with customers spending less and opting to save money for other expenses. Caron has noticed a significant drop in foot traffic since the onset of congestion pricing in January, with foot traffic down by almost 70% compared to before the pandemic.
Andrew Rigie, the executive director of the NYC Hospitality Alliance, has confirmed that several restaurants have reported declining patronage since congestion pricing was implemented. He notes that many businesses are struggling to cope with the additional costs imposed by congestion pricing, and this is making it more expensive to run a small business in the city. Rigie believes that exempting essential goods from the congestion fee would help alleviate the financial burden on businesses that rely on deliveries.
Food distributor Sysco and other suppliers have started adding congestion charges to deliveries within the affected area, exacerbating the financial strain on businesses like Delice & Sarrasin. While some distributors, like Baldor and Ace, have not yet imposed congestion fee-related surcharges, it is anticipated that prices may increase to cover the additional costs. Baldor has stated that it plans to offset the cost internally and explore options for overnight deliveries to minimize the impact of congestion pricing on their clients.
Despite Baldor’s commitment not to pass on tolling-related surcharges to their restaurant clients, smaller distributors may have to increase prices due to the high costs associated with congestion pricing. Ultimately, this could result in a rise in costs for small businesses like restaurants and impact end consumers as well. The challenges faced by Delice & Sarrasin and other restaurants highlight the financial strain that congestion pricing is placing on businesses in New York City, potentially leading to closures and job losses in the industry. The situation underscores the need for policymakers to consider the broader economic impact of congestion pricing and find ways to support small businesses affected by the policy.
