The U.S. Economy and Food: A Survey Part Two

Question 2. The food industry, fortunately is not static.
They can and do change, responding to the times. Some restaurants have
anticipated tough times and made adjustments to their practices ahead
of time. Jose Duarte of Taranta in Boston, a trailblazing restaurant in
terms of running green said, "We are one of the Nation's most Eco
Friendly restaurants and that has helped with energy costs, water,
etc." Steve Sando of Rancho Gordo, a premiere seller of top quality
heirloom beans and other products, sees the economic situation as a
potential opportunity, "I'm expanding. I think there's a better chance
to make more of an impact now. I think if we sold something silly or
frivolous I might change things but  I think we're doing something that
matters." He sees "home cooking (becoming) more important and (hopes)
our ingredients play a big role in that." On a more somber note, he
added, "I know how lucky I am at the moment and take nothing for

Chefs and restaurateurs are making additional
adjustments. One chef wrote, "I am softening prices as much as possible
and riding vendors a lot harder to help keep the costs down for
everyone. I am focusing my energy on marketing items like our
bar/lounge burger which is the same dry aged beef and natural c.a.b.
that we serve, grilled on the same wood fire and basted with the same
red wine butter…..for 1/3 the price. hopefully it will lure some in
where they might buy a cocktail or help us make a splash with the
locals who will continue to support us. Investing in our core clientele
also goes a long way in tough times." Another chef wrote, "One of the
things that I have done is cut back on expensive ingredients ( food
costs) and I've had to lay off a few people.I've had to make many
difficult decisions about artisan products and whether or not I can
continue to use some of them. We still use local ingredients but have
cut back there too. I've been running inexpensive specials using lesser
used cuts of meat, fish, etc. and people are responding. I'm not a big
fan of prix fixe, I'd rather tweak my menu to have less expensive
options. i think knee jerk reactions to the economy as such send a
message of desperation to your customers. That's just my opinion.
Having said that, I just started running a prix fixe at lunch because
the owners thought it was a good idea but i cant really see any
difference as far as sales." Running bargain prix fixe specials seems
to have become popular as a number of chefs have reported doing that or
offering cheaper appetizers and desserts to try to maintain or boost
sales of those items.

While that chef and others are reducing
their use of local ingredients, others are not, finding stability with
them. One midwestern chef wrote, "We also continue to buy all we can
from local purveyors, whose prices do not fluctuate with the wind."

restaurants are adjusting their practices to try to maintain wine sales
and to attract more business. One NY restaurant started pairing dishes
with wines and offering the wines at a small discount in an attempt to
drum up sales. Another started selling wine at half price on Tuesdays.

supply side of alcohol sales can be a factor for the struggling
restaurant as well. A wine importer wrote, "To combat this (the
recession), I have done several things. First, I have stepped up my
approaches to new accounts as well as solidifying current accounts.
Actually, we have been very aggressive. People are still buying wine;
so I'd like to get what I can now. Plus, that will better position me
when things turn around. And things will turn around in due time.
Second, I have cut superfluous expenses. We're running lean, but are
not doing without the important expenses. Third, we have watched cash
flow like a hawk. That means our inventory is smaller and we sometimes
prefer not to make a sale to a marginal client unless he pays up front.
The worst thing than missing a sale is making a "sale" to someone who
doesn't pay. There are other things, too, but suffice it to say that
cash is king, especially in this environment."

Leaner seems to be
the way to go. As one chef put it, "We are running leaner operations.
going with less staff and offering more affordable options for both the
restaurant and consumer.  Profit margins are shrinking just to stay in
business. More attention is being paid to the controllable costs in a
restaurant.  Labor, food and operational costs are being scrutinized
more closely.  Luxe items are finding their way off menus, being
replaced with more creative alternatives."

In short, chefs ,
producers and people in the trade are doing what they need to in order
for their businesses and themselves to survive. The savviest and the
luckiest likely will survive, but it seems, with already tight margins
for most restaurants that it will take a lot of each.

To be continued…

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