2014 Government Regulations & Business Summit
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The parking lot of the suburban restaurant was jammed at noontime. Traffic on the retail strip fronting the eatery was fairly heavy with holiday shoppers but other restaurants in the neighborhood were having an ordinary lunchtime. Not here, though. Patrons had to wait for a lunch table and lined up to do so. What was the attraction at this particular place on this weekday a full 10 days before Christmas?
It may be a phenomenon known as “New Regulars.” Simply put, restaurateurs are beginning to see regular customers once again, which is a positive economic sign. However, these regulars are not the same regulars who stopped coming in when the economy went bad in 2008. They are different people who may be in other lines of work or live in other neighborhoods.
A December report in The Wall Street Journal discussed how the economy has changed for restaurateurs in New York City. The food-service business in New York has had its own challenges over the past four years, as has the hospitality business in Rhode Island. Even the best-known restaurant operators and chef-owners have closed and opened numerous locations.
Let’s spend a moment with those key words, “closed and opened.” Keeping up with the number of restaurants closing during the course of a calendar year is like monitoring the stock market minute by minute through the trading day. The volatility of business is not for the faint of heart and can give a skewed picture of the industry. We are all familiar with and tend to accept at face value such statements as “Eighty percent of new restaurants will go out of business within their first five years.” This may be accurate from a number-geek perspective. However if it were entirely true, there would be a corresponding and marked decrease in the number of restaurants in town.
In fact what happens is that in many, if not most, instances, another restaurant opens in the place that closed, sometimes operated by the same owner. So at the end of the year, the number of restaurants in the neighborhood – or city or state – remains just about the same.
In Manhattan, a single location has been home to 13 different restaurant concepts in the past few years. Closer to home, one restaurant address in East Greenwich has been home to an Italian deli, a sweet shop, a hot dog place and a breakfast diner-all since May of last year.
Restaurant customers have gone through similar ups and downs in their lives. Individuals in the work force have seen their job descriptions change markedly over the past four years – usually resulting in added responsibilities. Transfers, consolidations, mergers and layoffs have all created a business community that looks very different than it did back in 2008. Individuals are working during what used to be off-hours, some have longer commutes or staggered days off (or multiple jobs with no days off). And some have been unable to find their way entirely back into the work force but are having to take “underemployment” supplemented with extended jobless benefits to pay the bills. The reality is that people still have money to spend but not the time to spend as they used to. “Nine-to-five” is no longer the workday for many.