California, Florida restaurant closures
Guest blogger Lance Jungmeyer here ....
The national housing crisis is having ripples at restaurants in California and Florida.
According to a recent article in Nation's Restaurant News (subscription required), there are closings and retoolings planned.
For instance, Lone Star Steakhouse & Saloon is closing 26 of its lowest-performing restaurants, including seven of eight Florida branches. The company blamed "soft economic conditions there, such as high insurance, food, occupancy, utility and labor costs."
In Florida, more than 37,000 homeowners were filing for foreclosure in January, with Cape Coral/Ft. Myers in a particular world of hurt.
It's not any easier on the Left Coast, where the article notes that more than 57,000 California homes were on track to be foreclosed in January, a 120% rise over the previous year. The Stockton and Riverside/San Bernardino areas seem the hardest hit.
"Independent restaurants also are struggling to bring in customers in California. Diners responded so well to Restaurant Week promotions in San Diego and Los Angeles this year, for example, that many fine-dining establishments decided to extend their value-priced prix fixe offers.
"Other restaurants are dropping corkage fees, offering lower-priced midweek specials and reformatting menus to lower prices."
What sort of economic conditions are you seeing? I'd like to know. Drop me a line at ljungmeyer@thepacker.com
Labels: FDA, foreclosures, The Packer
posted by Lance Jungmeyer @ 1:52 PM
1 Comments:
I live outside of Jacksonville, NC and you wouldn't know that the mortgage crisis is in progress. Communities on the beaches of NC are feeling the pinch but Jacksonville is building, tearing up farmland and being over run with development due to the expansion of Camp LeJeune Marine Corp base.
The restaurant trade here is does not seem to be suffering at all. Lines are long almost every night of the week. New restaurants are opening and there's no sign of a slow down here.
That said, food prices are on the rise, due in part to increased fuel costs and to the Easter freeze of 2007. One food price example I can personally relate to is the cost of a pound of frozen blueberries. Last year at this time I was paying $2.79/lb for a pound of blueberries. Earlier this week I paid $4.29/lb, a 54% increase in price in 12 months.
It hurts the wallet but my feeling is provided people have behaved, paid attention to their personal finances and kept their debt levels ot a minimum, they'll weather this inflationary period like every other and in 12-18 months the US will be back driving Humvees and full size SUVs as if $4/gal gas had been around forever.
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