The job to have these days is supplying restaurants with “For sale or rent” signs. The last two months alone would’ve made your year.
The bankruptcy of CB Holdings, parent of the Charlie Brown’s, Office and Bugaboo Creek steakhouse chains, snagged the headlines. But it was hardly the only operator to shutter restaurants (about 32 of its 80 outlets).
A Sonic franchisee in Florida benched the carhops at its 11 stores. Ted’s Montana Grill put nine of its 55 restaurants out to pasture. Jack in the Box shut 40 restaurants.
Recent times have been particularly lethal for landmark one-offs, like 91-year-old Lahiere’s in Princeton, N.J.; 53-year-old Terri’s in Portsmouth, Va.; nearly-40-years-old Stratton’s Dairy Dip in Ashland, City, Tenn.; and Elisha’s in Milford, N.H., a youngster with just three-and-a-half decades of operation.
Add in the bankruptcy of The Glazier Group, operator of the Michael Jordon’s and Strip House steakhouses, and it’s difficult to deny that the shakeout has intensified again.
The question is, how long will that rev-up continue? Is this just a year-end blip, a result of places assessing where they stand for the year and realizing they’re too far in the red?
Or is this an indication the recession could be a double-dipper for many restaurants? Did too many places bet they could ride out the downturn without adjustments, only to learn this is more of a new reality than a temporary departure from the business they knew?
Come January and February, we’ll know for sure.
Showing posts with label economic recovery. Show all posts
Showing posts with label economic recovery. Show all posts
Friday, November 26, 2010
Friday, April 10, 2009
The battle's turning, but so is the body count
Heard the good news? The worst is over for restaurants, or at least that’s what several research and news reports indicated this week. There’s just one problem: A lot of places won’t be there to enjoy it. They’re part of what’s starting to look like a tsunami of restaurant bankruptcies and forced closings.
Two subsidiaries of the Fatburger fast-casual chain filed for protection from creditors yesterday. A day earlier, Crain’s New York Business reported that Town, the highly rated New York outpost of chef Geoffrey Zakarian, was being pressured by two vendors to file for bankruptcy because the place hadn’t paid their bills.
The Pink Taco, an unqualified smash when it opened in Scottsdale to controversy over its name, has closed its legs for good. Also gone is another one-time hotspot in the area, the Fox Sports Grill.
The franchisor of the 37-unit Tumbleweed dinnerhouse chain threw in the napkin last week. Outback shuttered all nine of its steakhouses in Ontario. The lone Bob’s Big Boy in Glendale, Calif., the chain’s birthplace, is changing into something else.
The casualty list goes on and on, of places famous (Fior d’Italia, the San Francisco outlet that bills itself as America’s first Italian restaurant) or only locally known (the two Risotto’s MedRim Bistros in south Texas).
Yet the surging shakeout is hardly a contradiction of the positive outlook some are now airing for the business. It’s much more of a necessary correction, a painful symptom that has to be weathered while the trade’s overall health improves. Just as economists are predicting more job losses as the nation’s financial well-being starts to turn for the better, the industry is going to lose a lot of outlets, and not an insignificant number of brands. It’s part of the healing.
Two subsidiaries of the Fatburger fast-casual chain filed for protection from creditors yesterday. A day earlier, Crain’s New York Business reported that Town, the highly rated New York outpost of chef Geoffrey Zakarian, was being pressured by two vendors to file for bankruptcy because the place hadn’t paid their bills.
The Pink Taco, an unqualified smash when it opened in Scottsdale to controversy over its name, has closed its legs for good. Also gone is another one-time hotspot in the area, the Fox Sports Grill.
The franchisor of the 37-unit Tumbleweed dinnerhouse chain threw in the napkin last week. Outback shuttered all nine of its steakhouses in Ontario. The lone Bob’s Big Boy in Glendale, Calif., the chain’s birthplace, is changing into something else.
The casualty list goes on and on, of places famous (Fior d’Italia, the San Francisco outlet that bills itself as America’s first Italian restaurant) or only locally known (the two Risotto’s MedRim Bistros in south Texas).
Yet the surging shakeout is hardly a contradiction of the positive outlook some are now airing for the business. It’s much more of a necessary correction, a painful symptom that has to be weathered while the trade’s overall health improves. Just as economists are predicting more job losses as the nation’s financial well-being starts to turn for the better, the industry is going to lose a lot of outlets, and not an insignificant number of brands. It’s part of the healing.
Sunday, March 1, 2009
Industry lobbyists look to walk a fine line
The restaurant industry will have to be careful as it contends with a legislative threat that arose last week on Capitol Hill. A provision introduced in the Senate would prohibit the 421 financial institutions receiving federal bailout assistance from holding parties, celebratory dinners or other entertainment-type events, according to Michael Kaufman, the current chairman of the National Restaurant Association.
“Think of the effects of that bill on the hospitality industry,” Kaufman said during a presentation at the New York restaurant show this afternoon in New York City.
Kaufman cited the initiative as an example of the legislative proposals the Association regularly monitors and attempts to temper or defeat.
Good luck this time around. Lynch mobs probably formed after word leaked out of lavish parties being held by some of the banks that received billions in aid from the U.S. Treasury Department. The NRA will have to move delicately as it tries to preserve a lucrative source of event business for restaurants. Otherwise, it’ll look as if the industry is an enabler for the banks’ lavish shenanigans.
During his presentation, Kaufman also revealed the NRA is in the later stages of developing a new healthcare insurance program for the industry. He noted that the Association’s current chief, Dawn Sweeney, joined the group about a year ago after helping AARP develop a breakthrough healthcare program for its members. That acumen, he suggested, is being applied to the industry’s longstanding quest for affordable insurance for the rank-and-file.
An NRA director in attendance said he believes the program under development could cut the healthcare bill for him and his wife by more than $3,000.
“Think of the effects of that bill on the hospitality industry,” Kaufman said during a presentation at the New York restaurant show this afternoon in New York City.
Kaufman cited the initiative as an example of the legislative proposals the Association regularly monitors and attempts to temper or defeat.
Good luck this time around. Lynch mobs probably formed after word leaked out of lavish parties being held by some of the banks that received billions in aid from the U.S. Treasury Department. The NRA will have to move delicately as it tries to preserve a lucrative source of event business for restaurants. Otherwise, it’ll look as if the industry is an enabler for the banks’ lavish shenanigans.
During his presentation, Kaufman also revealed the NRA is in the later stages of developing a new healthcare insurance program for the industry. He noted that the Association’s current chief, Dawn Sweeney, joined the group about a year ago after helping AARP develop a breakthrough healthcare program for its members. That acumen, he suggested, is being applied to the industry’s longstanding quest for affordable insurance for the rank-and-file.
An NRA director in attendance said he believes the program under development could cut the healthcare bill for him and his wife by more than $3,000.
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