November 08, 2024
Business

Restaurateurs hope for busy summer

PORTLAND – Maine restaurant owners are hoping for a good summer after a bleak winter that put a chill on business.

The past six months have served up a most unpalatable menu for the restaurant industry: an early, cold and long winter, a stumbling economy and a war.

Maine Restaurant Association president Dick Grotton calls it the “winter from hell.”

The next few months may be a make-or-break time for some restaurants, he said.

“We’re facing a critical summer,” Grotton said. “We’re going to have a shakeout if we don’t have a good summer.”

Even in the best of times, restaurants are among the least certain of commercial enterprises. They require a lot of money to open, depend on fickle public tastes and are notoriously difficult to staff.

Most restaurants in Maine gross less than $500,000 a year and have 20 to 30 employees. Even the slightest slip in sales or rise in expenses can be brutal because restaurants’ profit margins, typically about 5 percent of revenues, are so slim.

“Restaurants are so financially fragile in general that it doesn’t take much of a downtick to send independent operators into a death spiral,” said Sam Hayward, the executive chef of Fore Street in Portland.

Last year didn’t start off bad and sales at Maine restaurants ran about 5.5 percent above 2001 during the summer.

But early cold cut short the early fall leaf-peeper season, and the economy took its toll on office-party catering jobs around the holidays, Grotton said. Even the shorter-than-normal period between Thanksgiving and Christmas had an impact, with shoppers feeling too rushed to take time for a leisurely lunch or dinner.

“We didn’t go into the winter with the cushion we normally get,” Grotton said.

Maine restaurants also are facing growing competition from chains. Applebee’s and Ruby Tuesday restaurants are proliferating around the state. On the Border and Lone Star have sprung up around the Maine Mall in South Portland.

Except for Mother’s Day, spring is a slow time for Maine restaurants. Most are getting ready for the summer, hoping for the best as they spend money hiring staff, fixing up the restaurant and starting marketing efforts.

Hayward, the executive chef at Fore Street, said this year may go down as part of a perennial boom-and-bust cycle when new restaurants move in and squeeze the marginal operations.

With unemployment staying high, people might cut back on trips to Maine, hurting those restaurants that rely on the tourism. Even those who do come for a visit, he said, may try to get by on a shoestring because of worries over the future.

“If they don’t show up at all, it could be disastrous,” Hayward said. “You could see some restaurants get really hurt.”


Have feedback? Want to know more? Send us ideas for follow-up stories.

comments for this post are closed

You may also like