Posted on 10/15/2008 12:30:17 AM PDT by 2ndDivisionVet
American restaurants are seeing a sharp decline in consumers and sales as the credit crisis continues.
Restaurants Hit by Credit Crunch
For the first time in two decades, the $550 billion restaurant industry is suffering from sluggish sales. Restaurant owners are being hard hit as credit lines for investment and operating costs dry up in the current economic recession. Increases in food and labor costs have also taken a toll on restaurant finances.
The current financial crisis has challenged owners of franchises and private establishments alike. Both have had difficulty attracting customers, paying employees and furnishing kitchens with the necessary tools and equipment.
Aaron Allen, CEO of international restaurant-consulting firm Quantified Marketing Group, told Time magazine, “The credit crisis is having a devastating effect on nearly every segment of the industry … This is the death knell for a number of restaurant chains.”
Fast food and upscale fast food spots that don’t have wait staff may fare better than full-service establishments as they can maintain lower costs.
A recent survey found that 38 percent of consumers have scaled back on restaurant visits. Of those who do dine out, 28 percent skip appetizers or desserts, and 21 percent are consuming less alcohol.
Restaurant critic Tim Zagat told New York 1, “It's not good and it’s probably the most threatening thing that has happened,” he said, referring to the current crisis. “But we’ve seen the industry, which is extremely strong, come through times that were equally difficult."
Zagat predicts that restaurants will continue to open, but notes that they will be “fewer and more value-oriented.”
Background: Restaurant industry in slow decline
The restaurant and bar industry has been suffering for much of 2008. Reuters reported that a survey published by Nielsen and Bevinco this summer said, “more than 40 percent of bar managers, bar owners, and bartenders surveyed … report they have seen a decrease in consumer traffic, while 25 percent note a decrease in the number of drinks ordered and 22 percent say that customers are ordering less expensive drinks.”
Related Topic: At-home dining boosts cookbook and cooking utensil sales
Market research firms have noticed that more people are preparing food at home to save money. But many have been eating in restaurants for years, leaving their kitchen cabinets devoid of the proper utensils and cookbooks. As a result, reports the Associated Press, “sales of cookbooks, inexpensive cookware and the basic foods needed to concoct a meal” are up, while magazines and Web sites devoted to cooking are thriving as new home cooks scramble to stock their kitchen shelves.
Remember, these places are often franchises. The one’s in my area are. It may not be corporate policy.
Mark
If Obozo manages to steal the election and get in the White House, there will be a lot more restaurants and many other businesses closing, due to his many tax increases and increased regulation.
Or maybe the USSA (United Socialist States of America) will just take over and run this businesses, rather than let them fail.
chown hall = town hall
Thought you were making a funny. How’s the food? Is sand good fiber?
I’ve felt the effects already. I work in an upper middle income community. I provide private instruction ( I won’t say what to protect the innocent, and me), and I recently had the parent of one of my best students saying they might have to cut back from an hour to a half-hour. He works in the restaurant biz and he says they’re getting killed. He’s going to hang in there this month because he’s a good dad, loves his daughter, she’s going great and loves it, but if things don’t improve (and I don’t expect them to), he’ll have to cut back.
Up north we call that "soul food." I presume that the African-Americans took southern cooking north with them during the post-Civil War migration. Soul food really is just good old southern cooking.
I don't suppose you want to venture into Detroit, from what I hear about the situation there, but you might try finding some little hole in the wall "soul food" shop in an area catering to African-Americans. That's the only place to find southern cooking in the north, unless you count Cracker Barrel.
A couple of restaurants have closed here in Louisville and I hear the pizza delivery business has slowed quite a bit.
Kind of scary. Several fast food restaurants in Evansville have closed. Two Rally’s, a Backyard Burger and a Popeye’s.
I haven’t noticed a lot closing, but over the last year and a half, I have noticed price increases and/or noticeably smaller portion sizes for the same price or more. Decreasing portion sizes and trying to pass it off for the same price ticks me off more than just raising the price, and I stopped going to several places that do this.
Examples: Outback Steakhouse I alwalys used to get the shrimp griller (kabobs). It used to be 3 huge kabobs that I could never finsh, now it is two small ones that don’t even fill you up.
Culver’s: my kids usually get a ‘free’ scoop of ice cream after their meal. They used to fill the cup so it was mounding over, now the scoop doesn’t even reach the top- it’s maybe 2/3 full. The hamburger patties are noticeably smaller, as well.
Taco Bell: the prices of all the meals have gone up noticeably and you literally have to use a magnifying glass to see any meat. Even my kids noticed that the tacos were all lettuce and tomato with a sprinkling of cheese and meat. Our family of five spent $27 there and we were still hungry.
This seems to happen everywhere we go (which is becoming less and less because I’m sick of getting ripped off).
My sister and I went to Olive Garden yesterday for lunch and asked about the “all you can eat” special they’ve had for years. Great deal, lots of food, low cost. The waitress said they had stopped the all you can eat last week. Guess they aren’t doing too bad since they can afford to charge full prices from their lunch menu.
Perhaps american’s will rediscover the joy of an afternoon picnic in the park instead of a quick burger and a visit to the mall on weekend afternoons.
Just a thought.
The food is not bad, it's just that when every meal comes from there, you long for variety. Every now and then, the Iraqis bring in some stuff from local restaurants and we really enjoy that.
Whenever someone is getting ready to go on R&R, they always start naming what they're going to eat when they're out of here and salivating at the thought.
I'll go on R&R later this year and help the economy of some of the local restaurants in my hometown. :)
Me too. When I travel I pick up a sandwich and a cup of coffee at the supermarkets. Saves a bundle and, best of all, no tipping.
I work as a bartender in a fine dining restaurant in Asheville, and all I can say is that sales are almost 40% down. :-(
Most of the restaurants in town are doing the same amount of business as usual.
Cooking is the one transcendent activity that can bring liberals and conservatives together.
But there is no way in hell I’m driving into Detroit for a southern meal, at least not without an armed fire team for backup.
That’s the difference right there — I could take my family anywhere in South Carolina for a great meal and not think about standing guard with an AR and a bunch of 30 round clips.
I’m currently stuck 560 road miles north of Detroit, and no one I know ventures into that racist sh#thole. And with good reason...Michigan is one of the most racist states in the union. And 90% of the racism comes from the rat party.
When you’re the only joint that serves free food (and the excellent TCN service) you’re bound to be packed day and night.
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