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As families forgo dinners out to save a little cash, eateries are tweaking
their services and rolling out new specials to cook up more business.
By Jenny Kincaid Boone and Lindsey Nair
Monday, April 20, 2009
James and Jeaneen Ingram used to eat out with their daughters just about
every Friday night.
These days, the Floyd
County family might go
out to eat once a month -- and even then, they are watching their wallets.
"If we get a date night, we choose just the movie and grab something at
home or just eat popcorn," Jeaneen Ingram said. "With the kids, it
seems like we'll choose something that has 'kids eat free' menus or anyplace
where you can find a coupon."
Many other families have had to alter their dining habits as well, whether
that means clipping restaurant coupons, going to less expensive eateries or
jazzing up dinner at home.
In a shaky economy, the restaurant industry is feeling the hit and
scrambling to find ways to keep customers without losing quality.
Chicago-based Technomic, a food market research company, predicts that 2009
will be the worst year for the industry since 1972, when it first began
tracking restaurant performance.
Running a restaurant is tough, even in sound economic times. Restaurants
have a high failure rate compared with most other businesses, particularly in
the first year, said Darren Tristano, executive vice president at Technomic.
The poor economy is compounding these pressures. And eateries should not
expect consumers' dining frugality to disappear even when economic conditions
improve.
"The longer it lasts, the more ingrained in our everyday lifestyle it
will become," Tristano said. "It will be hard for the restaurant
industry to break habits."
Frugal families
The Ingrams are not an extravagant family.
James and Jeaneen Ingram both work full-time jobs -- she works at CBIZ
Payroll in Roanoke and he works at the
Hollingsworth & Vose plant in Floyd
County. They have two
daughters, Jolie and Jordan.
The family used to travel to Christiansburg every Friday night to eat dinner
and do grocery shopping. She says they never picked fancy restaurants, opting
instead for "midgrade, sit-down places" such as Olive Garden or
Applebee's.
Still, it was a nice treat.
"After going to Wal-Mart with a 6-year-old and a 4-year-old, you
definitely deserve a treat," Jeaneen Ingram said.
But recently, there was a round of layoffs at Hollingsworth & Vose.
James Ingram was moved from his desk job back onto the production line and has
had to take off three weeks without pay.
As a result, the Ingrams, who strive to be debt-free, have made some changes
to their entertainment budget.
These days, they head to Wendy's or places like Country Cookin', where kids
eat free on certain nights. Or they stay at home on Fridays and have
"cafeteria night," when they warm up all the leftovers and put them
on the counter.
In addition, Ingram has put her family on a weekly meal plan. She plans
dinners for the coming week and buys everything at once, which has cut down on
impulse spending. She said their grocery bill has dropped about $40 per week.
Other families are taking similar steps.
Kelly and Mark Fitzgerald of Roanoke
County and their
daughter, Kasey, 4, used to eat out almost every night, but a few months ago
they decided to eat at home more often. Kelly Fitzgerald scours Web sites for
recipes, swaps meal ideas with co-workers and drags out the slow cooker.
After making those changes, Mark Fitzgerald's pay was cut 5 percent. And
because of their newfound frugality, they "didn't take a drastic hit to
the bank account," his wife said.
No family can be blamed for taking steps to secure their financial health,
especially during a recession. But if the dining room chairs at home are full,
that means a few restaurant chairs somewhere are empty.
Just water, please
At Wildflour Market and Bakery on Fourth
Street in Roanoke,
customers are cutting corners in little ways, and owners Doug and Evie Robison
are noticing.
"A lot of people come in and get soup and only soup," Evie Robison
said. "Maybe just a cup of soup, which is $3.75. Or just water with a
lemon. A lot of people are drinking water these days."
Tom Gordon, who owns The Blackwater Cafe at Smith Mountain
Lake, said sales were up
10 percent in January but down 12 percent in February.
Gordon said customers who might have once ordered a bottle of wine are
settling for a glass. And the $24.95 filet mignon entree, generally the top
seller on a weekly basis, has not been popular of late.
Henry's Memphis BBQ in Roanoke and Salem chose to close a
half-hour early on weekdays in January and February to combat flagging sales.
"There was just no way around it," owner Henry Caldwell said.
Although Caldwell
would not discuss specific sales, he said Monday through Wednesday dinner
business is down. According to Harry Balzer, vice president of the marketing
research firm NPD Group, sales for supper -- the most expensive meal -- are
suffering the most nationwide.
Still, most diners haven't changed the amount that they tip wait staff,
according to another Technomic report.
But "as diners spend less money, there's less tip," Tristano said.
Quality not compromised
On a Monday night at Martin's Downtown Bar & Grill in Roanoke, traffic is slow but steady.
By 7:30 p.m., chef/owner Jason Martin has skewered about a half-dozen
tickets on his metal ticket holder. All but two of the orders are for
hamburgers. That's the way it's been since Martin started his half-price burger
nights on Mondays.
He chose Mondays because the first days of the week are routinely the
slowest time for restaurants.
At Logan's
Roadhouse, diners can get two meals for $13.99 every Monday and Tuesday night.
In May, Famous Anthony's will launch $15 combo meals for two.
Even at high-end restaurants such as Town House in Chilhowie, the deals are
flying. Their "recession friendly dining" offers an entree and a
glass of wine for $25 per person.
Balzer said his group's research showed a 6 percent jump last year in the
number of meals bought in restaurants that included a special deal. He expects
that number to increase.
Tony Triplette, president and CEO of Famous Anthony's, said food deals do
cost restaurants more money up front, but in return they hope the discounts
will increase customer counts.
Martin has been happy with the results of his burger night. The number of
customers has doubled, causing him to add a cook and a server on those nights.
"Check averages are a little lower, but in general, we are actually
beating numbers from last year," he said. "I have no real formal
complaints about the economy."
Martin said he believes it is more important now than ever to not shirk on
the quality of food and service.
"If I was to change and cut the burgers 2 ounces shorter, people would
notice," he said. "Saving money is one thing, but quality comes
first."
Other restaurant owners agreed."
Evie Robison at Wildflour said she and her husband have tried to cut costs
in other ways, such as picking up shifts themselves.
"We have that luxury, whereas chains and franchises have to go up
several levels to get those changes done."
The upside
This tale does have a silver lining.
In some ways, the soft economy is helping a few Roanoke Valley
restaurateurs to invest in their businesses or even open new locations.
Famous Anthony's is remodeling four Roanoke Valley
restaurants. Triplette would not disclose the cost of the renovations, but he
said economic conditions have eased negotiations with contractors who are
trying harder to find jobs. Some have been more willing to work late at night,
when the restaurants are closed.
"They're trying to get through the crunch as well," Triplette
said.
Interest rates are low, and negotiating reasonable real estate prices is
easier. These factors are helping Richard Macher, president of Macado's, to
open three new restaurants. One will open next month in Bristol,
while locations in Staunton and Charlotte, N.C.,
are planned for next year. Macher's investing $1.5 million in the Bristol
Macado's.
"There's more of an opportunity, if you can look at it that way,"
he said. "Real estate is stabilizing."
Also, even as restaurant turnover is unusually low, these businesses have
been flooded with well-qualified job applicants.
In one week, without advertising, Henry's Memphis BBQ received more than 40
applications for one job position. Some applicants wanted a second job, while
others recently were laid off, Caldwell
said.
At Wildflour Market and Bakery in Roanoke,
"we've got a lot of people applying every day, so it makes it so that we
can be a little more choosy in hiring," co-owner Evie Robison said.
"I think some people have lost jobs, and I think some people are
moonlighting so they can save and just in case anything happens."
Said Tristano, "It's people who want to work. They recognize that this
is something they need to do. There are a few bright spots out there. This is
one of them."
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