More woes, no-shows
Every city has a dinner rush, but it’s an extreme phenomenon in Phoenix, where most diners will only make reservations in a narrow, 90-minute window. They don’t realize that, in effect, this puts an enormous strain on restaurants, from both an operational and a financial standpoint.
“In other cities, people are eating after 8 (p.m.). But in Phoenix, you can’t get anybody to sit before 6:30, and you can’t get anybody to sit after 8. That’s an incredibly difficult thing. You can’t run a restaurant on one turn,” says Degel, explaining that it’s hard to keep a restaurant viable when each seat is only filled once per night.
Arcadia resident Chris Spiekerman, a pediatrician who grew up in the Valley, dines out two to four times per week. And he’s the first to say, “There’s no way we’re eating at 8:30 (p.m.). We’re not on that schedule. Every day we’re getting up with the kids, we’re getting up at 6:30 in the morning. It’s tough to get off that schedule when you’re 40 years of age.” But at least he shows up. Many local chefs and restaurateurs say their no-shows have spiked in the past few years, leaving more and more seats empty during the critical dinner rush when a restaurant needs to be earning money off every table to make ends meet.
While many restaurateurs also mourn the loss of expense-account dining that dried up during the recession and never quite returned, that concern pales in comparison to one of the biggest challenges unique to the Valley: its heat.
“What business makes enough money in seven months to support the other five?” Wexler says, referring to Valley’s extreme seasonality. “My business drops 40 percent from March to July. The smart business thing is to close in May and see you back in October. But you would have to find a new staff (every year), which represents all kinds of problems.”
For many restaurants, surviving the summer is a matter of hanging on by their fingernails until winter visitors return. Figuring out how is the trick.
The benefits of being big(ger)
As the affordability and convenience of fast-casual dining commands a greater share of the Valley’s dining dollars, it’s traditional mid-range table-service restaurants that seem to be taking the biggest hit. But where it used to be local independents and national chains competing for the same slice of the pie, there’s another category of restaurant that carries a growing clout with every passing year.
“I love all of the local chain places,” Morris, the Chandler chef, admits. “Postino has been my favorite for, like, 15 years, since before it was a chain. I ate there twice this weekend.”
Locally based groups like Postino’s parent company, Upward Projects, along with LGO Hospitality, Fox Restaurant Concepts and others, have managed to thrive in an increasingly challenging environment, partly by virtue of their size.
“I think the business is changing everywhere, becoming more group-oriented,” Wexler says.
It’s certainly the case in the Valley. In addition to LGO, Fox and Upward Projects, local companies like Riot Hospitality, Square One Concepts, Genuine Concepts and Evening Entertainment Group are building extensive restaurant groups that possess natural advantages that individual restaurants might lack.
Fox Restaurant Concepts, now with 60 restaurants spanning 10 states (roughly half of them in Arizona), has the benefit of numerous locations where they can test ideas before using that data to streamline operations across the organization, as they did to adjust to the minimum-wage increase.
“Do you really need roll-ups on the table, or should we set the setting with an open linen and open silverware, just to take 35 seconds out of every time you have to set a table? All those 35 seconds, they add up,” Haddad explains.
Though the Fox group is not immune to the staffing shortages that plague the industry, it’s often in a better position to attract workers.
“We are able to pay sometimes better than what we need to,” Haddad says. “That’s a great luxury. And I think for career-oriented restaurant workers out there, young cooks and servers and hostesses that want to be restaurant managers and chefs, they really see career opportunity.”
Groups like LGO, with restaurants in Arizona and California, can offer geographic flexibility as well.
“Our people are moving back and forth all the time,” Lynn says, “and we see it as a big benefit to make that easy for them to do, because they love it.”
But Haddad and Lynn both stress that maintaining a local identity is critical to their success. It seems to be working.
‘Local loyalty’ to Valley chains
Jana Berrelleza, a graphic designer who lives in Gilbert, used to eat at national chains all the time. Not so much anymore. “It just seems like everything has shifted from chain restaurants to more local places, so we try to support more local places,” she says.
Lisa Corprew, a dean at the University of Phoenix, dines out frequently with her daughter and extended family. The Phoenix resident echoes a similar sentiment.
“I can’t remember the last time we went to someplace like Outback, and I couldn’t even tell you where a Chili’s is anymore,” she says. “Those kinds of places seem to be gone, which is fine. I don’t miss them.”
But while diners like Berrelleza, Corprew and Spiekerman tend to consciously avoid large-scale national chains, they’re more forgiving, if not downright warm, when it comes to local groups.
“We like to typically go to places that have more of a vibe to them,” Spiekerman says. “At least with Fox, the Henry, places like that, they don’t look so commercialized, even though you know it’s kind of a commercialized deal.”
Corprew remembers when the first Postino opened in Arcadia in 2001. “I still see it as a neighborhood place, even though I can literally drive through my circle of the world and see three of them,” she says. “I guess it’s sort of local loyalty.”
Asked why they often gravitate toward local groups rather than sometimes less conventional independents, the themes that emerge involve cost and convenience.
“Those premiere dining places, I don’t know who can afford going to them, and I do well,” Spiekerman says. And though he names FnB and Citizen Public House as a couple of favorites, he’s often more likely to eat where he can do so quickly: “If you go to a Fox restaurant, usually you sit down to get your drink, you get your meal, you’re in and you’re out.”
Berrelleza also names FnB, a chefdriven Scottsdale restaurant, as one of her favorites. Despite dining out multiple times per week, she guesses she has only visited three times in the past year, citing a long drive from Gilbert, the difficulty of sneaking away from her small children and higher prices than restaurants like Postino.
Indeed, though subject to the same price pressures as independents, some local groups are able to structure their operations with low prices in mind.
“Our restaurants are casual dining. We need the price point to be reasonable, and frequency is really important to us,” Haddad says. “Too high of a price point doesn’t bring enough guests to want to use us regularly enough. The math just doesn’t pencil out when we don’t get that frequent guest.”
In this manner, some local groups are capturing the reliability and pricing that was once the hallmark of larger chains, while offering diners an attractive local alternative.
But when it comes to pricing, how low is too low? And can local groups maintain quality with multiple outlets?
Many chefs and restaurateurs expressed admiration for the success Fox has achieved, but some feel they can’t compete with such a large organization and fear its growth is hurting the diversity of the restaurant scene.
Everyone is doing their best to make good food at a price diners can afford, but it’s a question that some of the larger groups struggle with. Lynn launched his career helping to turn Houston’s into a national phenomenon and now owns multiple restaurants in the Valley, but he’s uninterested in duplicating them.
“I think when things are being replicated, the reason that someone’s doing that is for ease of growth,” he says. “But built into that kind of thinking is what we did at Houston’s, and that was create a recipe book, create a training manual, hand it to a person and basically say, ‘Don’t think, do this.’ That’s just not how I want to spend the rest of my life, you know?”