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'Volatile' restaurant industry worse in economy

Posted January 11, 2010

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— Bob Jewett opened Bocci Trattoria and Pizzeria about a month ago in Cary in a location where two other restaurants have already closed.

So far, he says, business has been good, given the state of the economy.

'Volatile' restaurant industry worse in economy 'Volatile' restaurant industry worse in economy

"The other restaurants that didn't make it here for whatever reason – I feel like it was just the wrong concept," Jewett said.

But even on nights where there's a been a wait for a table, he's quick to correct a customer's observation.

"(A customer) looked around, and he goes, 'What recession?'" Jewett said. "I just kind of laughed and smiled and said, 'Well come see us on a Monday night or a Tuesday night.'"

Because no one agency fully tracks why restaurants are closing, it's difficult to say what role the economy might play in that.

Paul Stone, president of the North Carolina Restaurant and Lodging Association, says that generally more than half of restaurants close in about three years.

Added to what he calls a "very volatile industry," he says people are dining out less because of the economy, and when they do go out, they spend about 10 percent less."

Stone says the restaurants that have been hit the hardest are the higher-end establishments that relied on corporate business.

Those that appear to do better are ones that offer a unique dining experience and can more easily change their brand or menu.

The North Carolina Employment Security Commission keeps a database of news report that shows that 45 restaurants in Durham, Orange and Wake counties closed in 2008. Twenty-seven closed in 2009.

"Our area, frankly, was oversaturated a couple of years ago, and so there started to be a washout then," Stone said.

Stone says he wouldn't be surprised to hear of more restaurants closing in the next few months but that he also expects business to start picking up slowly.

"We are kind of bullish. We think (the restaurant industry has) bottomed out," he said, adding that it will continue to grow as people become more comfortable with the economy and begin spending again.

Jewett agrees.

"If you are giving them what they want, then they are going to come see you, and I feel really positive about the future and the opportunities," he said.

23 Comments

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  • exposure102 Jan 12, 2010

    I thought all you non smokers were going to be running out in packs to go eat in public again since the non-smoking law passed...put your money where your mouth is!

  • offconstantly Jan 12, 2010

    "NCcarguy - try being a young architect that's 30hrs away from being able to take the licensing tests, yet was laid off. Go ahead - do a national search for architectural intern. Not much will come up. And for the out of state ones that do, they actually want local people.

    Stories like this DO apply to us all. Ok - so restaurants aren't doing so hot. If they were, then its likely new ones will come in and want to build new bldgs (pretend they could get the loans) or upfit/refit old bldgs. This could potentially mean work for my hubby and work for any structural/mechanical/civil engineers. We're all connected in this together, and we want to see improvement in ALL areas - not just one or two."

    cool story bro....NOT

  • Picaflora Jan 12, 2010

    NCcarguy - try being a young architect that's 30hrs away from being able to take the licensing tests, yet was laid off. Go ahead - do a national search for architectural intern. Not much will come up. And for the out of state ones that do, they actually want local people.

    Stories like this DO apply to us all. Ok - so restaurants aren't doing so hot. If they were, then its likely new ones will come in and want to build new bldgs (pretend they could get the loans) or upfit/refit old bldgs. This could potentially mean work for my hubby and work for any structural/mechanical/civil engineers. We're all connected in this together, and we want to see improvement in ALL areas - not just one or two.

  • Nancy Jan 12, 2010

    The stories are long and similar about what non smoking enforcement on bars and restaurants have done to businesses everywhere. But hey, no skin of anyone's nose except the owners.

    http://www.nycclash.com/banshurtbiz.html

  • ncguy Jan 12, 2010

    Oh ya much more business because the smokers are gone.

    Please people, it's exactly the same.

    As for waiters not making as many tips? I waited tables in the 80's for 10 years- I LOVED SMOKERS!
    They were actually nice, spent a ton of money, were funny and tipped well.

  • DeathRow-IFeelYourPain-NOT Jan 12, 2010

    RedFox: "...one benefit of having non-smoking is my tables turn much faster."

    Good point. I just got hosed.

  • Steven Jan 12, 2010

    "Its not helping that the MANY snokers, that used to spend a TON of money in restaurants/bars, are now taking most of their business elsewhere."

    LOL are you kidding me? I've seen more business because of no smoking. Where, pray tell, are they taking their business elsewhere too if there isn't a smoking joint to eat at? I know plenty of smokers that haven't cut back on going out. A number of them are even going to try and quit smoking in the process.

  • sglangley35 Jan 12, 2010

    I don't think that this gets to the core of the issue. The problem is, people are spending less because they have less. Even those who have continued to bring home a paycheck have far less disposable income because of higher taxes and outrageous utility bills. At the end of the month something has to give: eating out, dry cleaning, car washes, lawn care. Money that could have been exchanged for services rendered is being given to municipalities.

  • james27613 Jan 12, 2010

    This tip stuff is just an excuse for the restaurant industry to pay their staff sub min. wages.

    These guys and gals are your front line to your business and they pay $2.13 an hour!

  • Bill Brasky Jan 12, 2010

    "Its not helping that the MANY snokers, that used to spend a TON of money in restaurants/bars, are now taking most of their business elsewhere."

    Ignore the fact that their was a surge in sales in the 40+ states that have already made smoking in restaurants illegal. NC was just behind in the times.

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