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Diesel prices fuel restaurant layoffs

Posted May 14, 2008
Updated April 20, 2010

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Editor's note: Kemp's Seafood House returned to table service in the fall of 2008.

A popular seafood restaurant has gone self-serve to cut costs as rising fuel prices continue to eat up its profits.

Kemp's Seafood House restructured to eliminate table service and assigned waitstaff to other positions to hold the line on its menu prices, owner Kemp Pendergrass said, blaming soaring seafood prices on soaring fuel prices.

Pendergrass said he also cut back spending on services like grass-cutting and window-washing.

Gas and diesel prices hit an all-time high Wednesday in the Triangle. The average price for a gallon unleaded regular gas was  $3.74, while the average price for a gallon of diesel, which was cheaper than gas a year ago, was $4.38.

Fishing boats run on diesel, as do the trucks that haul seafood from the docks to restaurants and supermarkets.

The added fuel cost is passed down the line. The price of a gallon of oysters, for example, is up almost $20 in the last year.

"You've got to realize that these guys have to go out on their boats to get the fish, bring it back in and then ship it up here," Pendergrass said. "So, that's just one of the things that's hurt this industry.

"I don't see the economy making a dramatic turn, so we had to do our due diligence and figure out a way to lower our prices for our consumers."

Down the road at JJ's Fish & Chicken, owner Ash Hamed said he has watched his profit margins shrink but hasn't yet cut his staff.

"You actually have to reduce your price to accommodate for the gas increase and swallow the difference," Hamed said. "So, your profit margin shrinks from 45 percent to 30 percent to 25 percent."

He said he hopes prices will eventually stabilize and begin to drop.

"Hope is what keeps you motivated," he said.

8 Comments

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  • NO_COMMENT11235813 May 15, 2008

    Went to Kemp's last night
    I give them 2 months till they are out of business. This place stinks now.

  • SheriffTruman May 15, 2008

    Funny Kemps has been closed for several months (so I am guessing they had long ago laid off the wait staff) and just recently reopened with this self service theme (2 or 3 weeks ago) and suddenly they have this article? Sounds like maybe a reporter and WRAL just gave them some nice free publicity.

  • Space Mountain May 15, 2008

    I like Kemp's but it's been two years since I have been there. I heard people complaining about thier prices more than a year ago. They always had a lot of business, so I don't know how they were hurting for money. The waiters get paid less than minimum wage, too. They make their money from tips. Maybe the fuel price has cut into their profit some, but I bet they were still making a lot of money. If they lost business it was because they raised prices while the quality of food went down. Like I said, people were saying this over a year ago. I just don't see how getting rid of folks you paid less than minimum wage and not having any servers at all will help business. In fact, I think it will hurt it a lot more. I know I wouldn't want to go to a place that isn't supposed to be fast food and not be served.

  • Red May 14, 2008

    There's the trickle down economics we all know and love.

  • capitalland May 14, 2008

    Here's an idea. Clean out the friers and send that biofuel down to Manteo to run the shrimp fleet.

  • parr4246 May 14, 2008

    so the prices are the same but there is no-one to bring you the food after you order it.....................???!!!

  • bobdillin123789 May 14, 2008

    dont like it, then walk

  • Worland May 14, 2008

    NC taxes diesel over 50 cents a gallon, the Feds 20 cents. When you tally up the other taxes on oil and gasoline production, over a dollar you pay at the pump goes to the gov't.