Is Dining Out?

The white tablecloths glow and the candles flicker, but the
maitre d is liable to be clicking his heels by the front door, wondering where
the diners are.

At the pub around the corner or at the sandwich shop down
the road, perhaps.

Washingtons restaurant business has taken a beating this
year. The industrythe states largest employershed nearly 7,000 of its
201,000 employees in January; another 1,000 were laid off in February. Many
restaurants are struggling not only because of the economy, but also because of
wicked December weather. Across the state, snow forced businesses to cancel
company Christmas parties, leaving restaurants holding an especially pricy tab.

The industry needs to get fat in December, says Anthony
Anton, president and CEO of the Washington Restaurant Association (WRA).
Ideally, restaurants are putting away nuts in December to survive for the next
three months. When Christmas parties are snowed out, they [restaurants] dont
get rebooked for February.

That downturn means many restaurants are experiencing a
deficit in cash, the very supply that most use to buoy themselves through the
slower winter months.

So which restaurants are on simmer and which are going cold?
Seattle institutionswhere layoffs downtown affected the dining businesshave
been hit hard, as have fine dining establishments and those catering to the
business lunch and expense account. Many iconic establishments, including Walla
Wallas 26Brix, Seattles Typhoon! and Tacomas Sea Grill have shut their
doors.

And yet, hope glimmers somewhere on the horizon.
Neighborhood eateries, it turns out, are weathering the economic storm
reasonably well. At some Seattle restaurants, such as Endolyne Joes, the
Hi-Life and the 5 Spot, the morning breakfast run has been holding steady and
even seeing some growth, according to Jeremy Hardy, co-founder and managing
partner of Chow Foods, those eateries parent company. And while traffic during
the p.m. shift has been down, check orders have remained consistent, he
says.

Whats more, despite the recession and a public bent on
maximizing its dining bargains and minimizing its tabs, new restaurants continue
to hang out their sandwich boards. Take, for example, Homegrown Sustainable
Sandwich Shop, which opened in Seattles Fremont neighborhood March 24. Within
a month, the organic, quick service eatery was exceeding its profit
expectations.

That kind of success is due in part to the restaurants
business model: Quick service establishmentsplaces where you order at the
counter and bus your own silverwareare faring well, garnering more of the
check. Experts say this situation is due in part to super-busy consumers
realizing they still want to eat out. So instead of foregoing restaurants
altogether, they have changed habits. When its healthy and fast, quick service
dining is making people salivate.

Brad Gillis and Ben Friedman, Homegrowns owners, readily admit
they have benefited from the economy in other ways. Because fewer restaurants
are opening right now, Homegrown has garnered a fair amount of buzz and become
one of the local must-try new places. Meanwhile, the down economy means
Homegrown has been able to garner a premium piece of real estatethe site of
the former Bulldog News in the heart of Fremontfor cheaper than normal rent.

In Spokane, Gary Swiss saw an opportunity in upscale quick
service, too. This May, the retiree opened Crazy Gs, a high-end burger joint
that also offers Philly cheese steaks and hot dogs. It uses only premium
products, such as six-ounce Angus beef patties.

Why call it Crazy Gs? In part, says Swiss, because its a
crazy time to open a restaurant. And yet, after surveying the market, he
realized the only other burgers in town were coming from bars or were fast food
burgers with a patty you cant kill, he explains. We thought there was room
for the idea of a home-style burger out there, says Swiss. In this economy,
people are more picky, and yet I think the business is out there.

While quick service may be the current it-kid, the white
tablecloth guys polish their silver and wait. Or, they revise their business
model.

At Rovers in Madison Valley, chef and owner Thierry
Rautureauwho admits business this year has been downexpanded the restaurants
hours and services to attract customers. Rovers began serving Sunday brunch
and Sunday dinner in April. Brunch, he says, allows diners who might not want
to invest in Rovers dinner prices an opportunity to enjoy the restaurant at a
lower price point.

Which is how many high-end restaurants are responding to the
times: by creating lower price points, a better dollar value and new specials.
Overall, says the WRAs Anton, the $25 entree has become a $22 entree; and $22
is now $18.

Its a great time to eat out, Anton adds. The values are
fantastic and the service and attention diners are receiving now is different
from a few years ago.

New services and different price points arent the only
means of attracting and retaining customers, says Rautureau. The most important
thing is to concentrate on the bird in the hand. Its time, he notes, to take
the best care of your customers and be diligent about consistency and quality.

Concentrate on your own customers. They love
you already, says Rautureau. Keep them happy and theyll keep coming.

Related: Value Meals: How restaurants boost the bottom line while still bringing in the customers.