Comments on: How Will the Credit Crunch Affect the Restaurant Trade? http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade Food - Photography & More Fri, 18 May 2012 03:15:08 +0000 http://wordpress.org/?v=2.0.7 by: Rod http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-16297 Thu, 28 May 2009 13:33:41 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-16297 John Burton Race has just declared himself bankrupt ! Another casualty Best Rod John Burton Race has just declared himself bankrupt !
Another casualty
Best
Rod

]]> by: miles http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9642 Sat, 20 Dec 2008 08:16:23 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9642 Dave, A great comment, thankyou. It's important to know how this situation is being seen in other countries. All we get over here is talk of Fanny Mae, Chrysler and hedge funds whilst, as you say there are thousands of small restaurants and food outlets facing tremendous hardship. You're so right about the relief chef scenario, who now will even consider paying the weekly bill that some twenty five year old with poor skills and bad attitude has 'earned' because the owners didn't think they had any choice? Greed has much to do with all of this and, as you say it's the 'one of a kind' eateries which are set to suffer and receive no high profile bail out. What's going to happen to them? They don't have the fat cat bank balances that those idiots in our financial institutions have ensured they have-and keep. Watch this space.... Dave,
A great comment, thankyou. It’s important to know how this situation is being seen in other countries. All we get over here is talk of Fanny Mae, Chrysler and hedge funds whilst, as you say there are thousands of small restaurants and food outlets facing tremendous hardship.
You’re so right about the relief chef scenario, who now will even consider paying the weekly bill that some twenty five year old with poor skills and bad attitude has ‘earned’ because the owners didn’t think they had any choice?
Greed has much to do with all of this and, as you say it’s the ‘one of a kind’ eateries which are set to suffer and receive no high profile bail out. What’s going to happen to them? They don’t have the fat cat bank balances that those idiots in our financial institutions have ensured they have-and keep.

Watch this space….

]]> by: Dave http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9641 Sat, 20 Dec 2008 07:24:46 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9641 This deserves much more time than I have to answer. New York City is quite unlike most other cities in the US. The incredible number of restaurants (16,000 in Manhattan alone) means that some attrition will occur naturally in any downturn. But, this isn't a downturn - we are in a very serious, prolonged recession. It could last several years (1 - 2 minimum), and there is no guarantee of coming out into a bright shiny day. Food costs have mercifully gone done from their ridiculous 2nd and 3rd quarter escalation, unfortunately this is partly due to decreased demand. As far as labor costs - they are going to go down - over supply and declining revenue always create lower wages. It becomes the time when people are happy just to work - what i meant in the other other post - relief chefs have traded any sort of security to chase salary - no loyalty = no salary. Sorry guys, I'll hire the line cook my friend recommends (the one he had to let go because of budget constraints) instead of a "knife for hire". At least I know who wants to work, and won't leap for an extra $2 an hour. As far as the restaurant business - we are all screwed. It is going to a long, miserable stretch. My favorite type of eatery is the kind we lose forever in these environs - the "mom and pop" shop where people cook because they love it and want to share their love of what they grew up eating. Is there better food than grandma in the kitchen cooking up the dishes she ate as a child in the "old country"? Miles, I have so much more to say - but my eyes are closing from tiredness and drink - we lose the real food in times like this. The high end will always have its patrons - deservedly - and maybe a few will close. The lower end will contract to those actually producing a decent meal cheaply. It's the "I don't fell like cooking let's treat ourselves places" that are fucked - places kept alive through hard work and love. I will dine out more than ever now, trying to support my favorite locals - only to be crushed as they slip away. It's already happening. This deserves much more time than I have to answer. New York City is quite unlike most other cities in the US. The incredible number of restaurants (16,000 in Manhattan alone) means that some attrition will occur naturally in any downturn. But, this isn’t a downturn - we are in a very serious, prolonged recession. It could last several years (1 - 2 minimum), and there is no guarantee of coming out into a bright shiny day. Food costs have mercifully gone done from their ridiculous 2nd and 3rd quarter escalation, unfortunately this is partly due to decreased demand. As far as labor costs - they are going to go down - over supply and declining revenue always create lower wages. It becomes the time when people are happy just to work - what i meant in the other other post - relief chefs have traded any sort of security to chase salary - no loyalty = no salary. Sorry guys, I’ll hire the line cook my friend recommends (the one he had to let go because of budget constraints) instead of a “knife for hire”. At least I know who wants to work, and won’t leap for an extra $2 an hour.

As far as the restaurant business - we are all screwed. It is going to a long, miserable stretch. My favorite type of eatery is the kind we lose forever in these environs - the “mom and pop” shop where people cook because they love it and want to share their love of what they grew up eating. Is there better food than grandma in the kitchen cooking up the dishes she ate as a child in the “old country”?

Miles, I have so much more to say - but my eyes are closing from tiredness and drink - we lose the real food in times like this. The high end will always have its patrons - deservedly - and maybe a few will close. The lower end will contract to those actually producing a decent meal cheaply. It’s the “I don’t fell like cooking let’s treat ourselves places” that are fucked - places kept alive through hard work and love. I will dine out more than ever now, trying to support my favorite locals - only to be crushed as they slip away.

It’s already happening.

]]> by: Cid http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9627 Fri, 19 Dec 2008 18:47:16 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9627 Miles, You see, two comments for the price of one on today's post..... good value as always this blog!! Anyway as I was munching on my baked potato in a little cafe this lunch time (who said I don't eat out much?!) I decided to ask the rest of the table what their views were on this topic. To my surprise one said that since her mortgage payments had reduced she had benefited to the tune of a couple of hundred each month.... phew! Subsequently we all agreed that if a person was fortunate enough to keep their salaried job then things at the moment were looking a good deal better than a few months ago. Perhaps some folk will eat out more after all, the rest as Elsie says, will have to learn to cook which as we all know is one of life's great pleasures. Pity Miles that it's not you behind the new restaurant deal near me.... because if it were then I'd feel doubly delighted and leap to ironing my old waitress outfit for the inevitable call to arms. My proposal would have been to offer an Argentinian tango lesson for every third booking and to save costs you'd have to tango in and out of the kitchen to keep both sides on the boil as it were :) Sometimes I wonder why I'm not a rich woman... Cid Miles,

You see, two comments for the price of one on today’s post….. good value as always this blog!!

Anyway as I was munching on my baked potato in a little cafe this lunch time (who said I don’t eat out much?!) I decided to ask the rest of the table what their views were on this topic. To my surprise one said that since her mortgage payments had reduced she had benefited to the tune of a couple of hundred each month…. phew! Subsequently we all agreed that if a person was fortunate enough to keep their salaried job then things at the moment were looking a good deal better than a few months ago. Perhaps some folk will eat out more after all, the rest as Elsie says, will have to learn to cook which as we all know is one of life’s great pleasures.

Pity Miles that it’s not you behind the new restaurant deal near me…. because if it were then I’d feel doubly delighted and leap to ironing my old waitress outfit for the inevitable call to arms. My proposal would have been to offer an Argentinian tango lesson for every third booking and to save costs you’d have to tango in and out of the kitchen to keep both sides on the boil as it were :) Sometimes I wonder why I’m not a rich woman…

Cid

]]> by: Elsie Nean http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9624 Fri, 19 Dec 2008 17:02:20 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9624 Miles, I would agree with you and echo the comments of Rod and Cid. It is the knock on effects that are the worse. You take all the suppliers, delivery etc. of Woolworth alone without their own staff. It is also these smaller firms that depend on new business opening, e.g. fitters and all manner of tradesmen. They in turn may have families to keep and somewhere along the line it comes down to basic living. Luxuries like eating out will go and will only be that special treat from time to time. I know of a couple who owned a restaurant and worked hard to make it a success. They have been forced to close and lost their home as well. Very sad. There was already evidence of less eating out on the Continent. As you say, Miles, all the food suppliers and growers in turn will equally be affected. Let us hope that home cooking will, at least, be back in vogue. Elsie Miles,
I would agree with you and echo the comments of Rod and Cid. It is the knock on effects that are the worse. You take all the suppliers, delivery etc. of Woolworth alone without their own staff. It is also these smaller firms that depend on new business opening, e.g. fitters and all manner of tradesmen. They in turn may have families to keep and somewhere along the line it comes down to basic living. Luxuries like eating out will go and will only be that special treat from time to time.
I know of a couple who owned a restaurant and worked hard to make it a success. They have been forced to close and lost their home as well. Very sad.
There was already evidence of less eating out on the Continent. As you say, Miles, all the food suppliers and growers in turn will equally be affected.
Let us hope that home cooking will, at least, be back in vogue.
Elsie

]]> by: miles http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9623 Fri, 19 Dec 2008 16:50:27 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9623 Cid, Very perceptive. The problem with restaurants tends to be that they have nothing else to offer such as rooms and function capabilities so they are very restricted in what they can claw in with regard to extra revenue. A very interesting if not slightly scary year lies ahead. Miles Cid,
Very perceptive. The problem with restaurants tends to be that they have nothing else to offer such as rooms and function capabilities so they are very restricted in what they can claw in with regard to extra revenue.
A very interesting if not slightly scary year lies ahead.

Miles

]]> by: miles http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9622 Fri, 19 Dec 2008 16:47:00 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9622 Rod, You're right, everyone talks about the price of food but in reality it's the staff costs which hits a business hardest. I liked the way Brown banged on about the oil producing countries today only for the leader of OPEC to say 'lower your tax on fuel then talk to us-you tax your people more than any other country in Europe' As people's utility bills go up then, as you so who is going to go out and blow £100 on a meal? Great comment, thanks. Miles Rod,
You’re right, everyone talks about the price of food but in reality it’s the staff costs which hits a business hardest.
I liked the way Brown banged on about the oil producing countries today only for the leader of OPEC to say ‘lower your tax on fuel then talk to us-you tax your people more than any other country in Europe’
As people’s utility bills go up then, as you so who is going to go out and blow £100 on a meal?

Great comment, thanks.

Miles

]]> by: Cid http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9616 Fri, 19 Dec 2008 09:25:38 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9616 Miles, My own eating habits won't be changing but then I don't eat out much and if I do it tends to be a bowl of soup in the city, close to the shops. What's always puzzled me is that my little town has lots of eateries but in my large circle of acquaintance, there's not many who frequent them.... someone must be keeping these businesses going? In all honesty I don't see all my local restaurants surviving, there are just too many. Not only that but I understand a new restaurant is coming to town in direct competition with all the others. New business in this climate is brave especially in the back waters of the Shire where the locals grumble about the price of potatoes! I will keep you posted on developments. All the credit problems we're facing now won't affect the youngish retirees who have made their money already and are free to continue to spend in much the same way. As far as I can tell these groups are always out and about spending and eating. Company policy could well change although not through necessity in every case but perception.... I recently heard of a bank whose best sales people had won the right to a weekend away on expenses... because it looked bad in the current climate, it was cancelled at very short notice. Cid Miles,

My own eating habits won’t be changing but then I don’t eat out much and if I do it tends to be a bowl of soup in the city, close to the shops. What’s always puzzled me is that my little town has lots of eateries but in my large circle of acquaintance, there’s not many who frequent them…. someone must be keeping these businesses going? In all honesty I don’t see all my local restaurants surviving, there are just too many. Not only that but I understand a new restaurant is coming to town in direct competition with all the others. New business in this climate is brave especially in the back waters of the Shire where the locals grumble about the price of potatoes! I will keep you posted on developments.

All the credit problems we’re facing now won’t affect the youngish retirees who have made their money already and are free to continue to spend in much the same way. As far as I can tell these groups are always out and about spending and eating. Company policy could well change although not through necessity in every case but perception…. I recently heard of a bank whose best sales people had won the right to a weekend away on expenses… because it looked bad in the current climate, it was cancelled at very short notice.

Cid

]]> by: Rod http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9615 Fri, 19 Dec 2008 08:10:38 +0000 http://www.milescollins.com/wordpress/how-will-the-credit-crunch-affect-the-restaurant-trade#comment-9615 Miles a good post ! Personally I think it is going to be much worse than even the commentators are suggesting ! Any business involved in anything non-essential will suffer badly I think. I never hear mention of "operating margins" which is crucial to this issue. A lot of business is narrow margin with the reuslt that net profit is a small percentage of turnover. This being so a business can go from profit to loss with only a relatively small decline in turnover - this is what is going to finish a lot of people off. There are dreadful times ahead and the worst of it is much of which that will be lost will never return. If a specialist quality butcher shuts it will never re-open ! For the restaurant trade I think all sectors will suffer, from the top end to the £3.99 'all you can eat'. Ultimately, most people eating out need not do so ! Cheers Rod Miles
a good post !
Personally I think it is going to be much worse than even the commentators are suggesting !

Any business involved in anything non-essential will suffer badly I think.
I never hear mention of “operating margins” which is crucial to this issue.

A lot of business is narrow margin with the reuslt that net profit is a small percentage of turnover. This being so a business can go from profit to loss with only a relatively small decline in turnover - this is what is going to finish a lot of people off.

There are dreadful times ahead and the worst of it is much of which that will be lost will never return.
If a specialist quality butcher shuts it will never re-open !

For the restaurant trade I think all sectors will suffer, from the top end to the £3.99 ‘all you can eat’.
Ultimately, most people eating out need not do so !
Cheers
Rod

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