Restaurant Olivia co-owners Austin Carson, Heather Morrison and Chef Ty Leon

Restaurant Olivia / Facebook

Italian Restaurant Owners Reinvent Their Business Model for Pandemic

Business as usual is a thing of the past at Denver’s Restaurant Olivia, which recently reopened for dine-in service with a radically new business model designed for the pandemic era.

Restaurant Olivia, co-owned by Heather Morrison, Austin Carson and Ty Leon, debuted in Denver in January 2020 as an elegant, pasta-focused Italian trattoria named after Morrison’s young daughter. The menu featured everything from rabbit-stuffed cappelletti and ricotta gnocchi with romanesco pesto to basil-infused mafaldine with pork-and-veal meatballs and toasted garlic pomodoro sauce. Among the limited entrees was the Milanese and Baja Pacifico bass with white beans and salsa verde.

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Like many dine-in restaurants that launched in early 2020, Restaurant Olivia had to quickly pivot to carryout when the pandemic struck and lockdown orders went into effect. During the three-month break, the owners put on their thinking caps and decided to reinvent their approach. Now the restaurant offers a prix fixe four or six-course tasting menu, with pricing that varies according to day and time. Customers can choose between two items for each course; for example, course three of the four-course meal currently offers a choice of either Pork Milanese or Seared Wild Halibut. Guests have 90 minutes to eat and then move on, with only five tables open at any given time.

“We have initiated dynamic pricing and will be offering discounts on certain time slots to ensure a safe and even distribution of people in the dining room throughout the week,” the company explained in a June 10 Facebook post.

The pricing covers everything, including service, and no tipping is permitted. Customers must prepay when they make their reservations. Carson told Restaurant Hospitality (RH) that he is working on a plan to balance out wages for back-of-house and front-of-house staff.

According to the Restaurant Hospitality story, Carson and his partners believe the standard business model for restaurants is fundamentally unsound—and its flaws have finally been exposed by the pandemic. “We’ve all got a really good look at this house of cards this whole business actually is,” he said. “Within 24 hours of the governor announcing the shutdown in [Colorado], we had to furlough virtually everyone on our staff. People got a really visceral look at how little margin for error there is.”

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To remain financially viable with limited dine-in service, Restaurant Olivia has raised its prices significantly for its prepaid tasting menu—the four-course offering might cost $70 on a Thursday evening or $90 on a Saturday night. “People don’t understand that cocktail was $12, and now I have to charge $15 to cover the cost of people doing the job, so that cocktail looks more expensive,” Carson told RH.

Making customers pay in advance ensures the restaurant doesn’t lose money on cancellations, while the dynamic-pricing approach lets Carson establish “what each seat is worth and to what extent do I monetize each seat.”