"I don't know — maybe they're on a diet."
I can't tell if Beth Schibanetz is kidding or if she's speaking metaphorically. These days, we're all on a diet, tightening our belts down to the last notch. The owner of Josef's, a fine-dining restaurant in Plantation, says she isn't sure why she's seeing customers come in lately and order nothing but a salad and a glass of tap water.
It didn't used to be this way. Josef's just celebrated its sixth anniversary, and every year has been better than the last for Beth and her husband, Joe. They'd found a niche and kept carefully excavating it: dishes from the Austro-Italian border with a list of wines from the same region, served to a fanatically loyal clientele of doctors, pharmaceutical reps, and local gourmets with plenty of cash to burn. The restaurant has never been a bargain basement: A butterflied Milanese-style veal chop or a loin of venison with pomegranate sauce are priced in the mid- to high 30s. But until this year, people had always been willing to pay for luxuries like Beth's particularly soothing brand of hospitality, organic grass-fed beef, sustainable local fish, and little touches like chocolate-covered strawberries at meal's end.
Restaurants in a Recession
Now, her customers are on a diet. It's restaurants at the top end of the foodie spectrum that are getting hit hardest by the recession — a recession that, we learned last week, in case we hadn't figured it out, is now "official" in Florida. Florida's economy shrank 1.6 percent in the second quarter of the year, worse than the rest of the large states. According to the South Florida Business Journal, customers are turning away from upscale restaurants and aiming their dwindling discretionary spending at "fast casual" places like pizza parlors and sports bars.
Restaurateurs like Beth and Josef are taking extreme measures to keep themselves afloat for a slowdown that Wachovia economists have predicted will last until Florida "bottoms out" in early 2009. At Josef's, with business receipts down 20 percent from last summer, they've pared their dining room from 74 seats to 45 by closing off a back room. "We're operating with a skeleton crew in the kitchen and dining room," Beth says. "We've got a prep cook, a pot washer, and one waitress, and our kitchen staff all have second jobs." The restaurant is open now just five nights a week, and "we're not reseating," Beth says. Those beautifully set tables ain't turning.
"Our purveyors are coming in and talking about who bit the dust," Beth says. "They're losing accounts right and left; lots of restaurants are closing. We have customers telling us we should just move out of Florida. 'Go here, go there, come to North Carolina' or wherever. And we entertain the fantasy. But I'm too old to start all over again somewhere else. This recession is going to shake out the wheat from the chaff. People who have just started out, who don't know what they're doing, or who got greedy are the ones who are going to go under. We're gonna stick it out."
Lots of restaurants are closing, and not just Starbucks. This year has seen a list of casualties that includes not just greedy young upstarts but old-timers, restaurants that have been around so long that they're into their second and third generations of customers. Mark Militello's eponymous Mark's closed three of its four locations; Michael's Kitchen fled Hollywood, leaving a paper trail of lawsuits; Try My Thai went under in spite of more than $60,000 in grant money from the City of Hollywood; Tsunami in West Palm went belly up, and even Columbia at CityPlace, a restaurant that had lasted a century at its original location in Tampa, couldn't hack the economy. Saucy Creolina's, a thoroughly urban fixture on Las Olas for 17 years, shuttered its doors a couple of weeks ago, and owner Mark Suzinski announced he's moving way the hell out to State Road 84 in Davie and slashing his prices — like this is good news for downtowners? In Delray Beach, 32 East's Latin sister restaurant, Sol Kitchen next door on Atlantic Avenue, has closed. Regular customers are mourning the loss of Nirvana in Boynton, Food Amongst the Flowers in Wilton Manors, Hobo's Fish Joint in Deerfield, and don't even get me started on Miami: Norman's, Afterglo, Duo, Max's Grille...
In Hollywood, chef/owner Michael Wagner and general manager Heather Keenly are celebrating the first anniversary of Lola's, even if the mood of their baby's birthday party is a little more somber than they might have hoped. "In the year I've been open, I've seen quite a few restaurants open and close in Hollywood," Wagner says. "This is a challenging city to run a restaurant in. I picked this location because Hollywood is like a diamond in the rough, with room for a lot more growth. I thought I'd open here and be ready when the area takes an upswing."
When and if. Lola's is Wagner's first restaurant, although he worked as a chef for all the big names — Chef Allen, Mark's, Johnny V. But he says he really learned the business of restaurant management from the master, Jeffrey Chodorow of China Grill Management, when Wagner worked at Tuscan Steak. Chodorow taught him his philosophy of keeping control of the business so there are "no surprises." Wagner says he translated Chodorow's methods and tweaked them for Lola's — keeping templates for recipes, tracking food costs, payroll, and inventory day by day — even hour by hour — down to the penny. "I learned as I went, and I'm a much better owner today than I was a year ago," he admits.
One way to keep costs down, Wagner says, is to buy according to season and what's available locally at the best price. "Local" and "seasonal" become more than just the restaurant trend du jour — operating on locavore principles can be good for the environment, stimulate the local economy, provide tasty meats and vegetables for customers, and cut a restaurant's costs. When the price of mahi-mahi doubles in summer as the fish swim away from our coasts, Wagner switches to red snapper, abundant in summer from Pompano Beach to the Keys. It's ironic, Wagner says, that just as guests are getting hip to, and demanding, organic/free-range/grass-fed produce and meats, they're also feeling pinched enough to want lower prices. So buying and sourcing become a particularly keen balancing act.
In Parkland, Kevin Lee at Japango is worried about the expansion the restaurant undertook last year. "We put in a full liquor bar and added 70 more seats, but we're doing exactly the same numbers this year as we were last year" in spite of the extra space, he says. Now, the plaza Japango is 50 percent vacant. "What I'm hearing across the board is that restaurant business is down 30 percent," Lee says. "I'm serving the same menu and using the same purveyors, but my purveyors have added a fuel surcharge to every delivery. So I'm trying to really keep the deliveries to a minimum, and I'm not passing on the higher prices to my customers." In the wealthy communities of Boca Raton and Parkland, from which Lee draws his customers, the average household income is more than $100,000. Lee says he doesn't think his customers literally have "less money in their pockets." But they're certainly spending less. "It's psychological," he says.
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Further north in Palm Beach, the Tasca family at Capri Blu are surprised to find their business is better this summer than it was this time last year. After ten years in West Palm Beach, where they suffered through every indignity known to restaurant ownership — torn-up streets, major construction directly across from their door while the new City Hall was being built, a string of boom-and-bust cycles as the downtown staggered to its feet — they finally threw up their hands and moved across the bridge to Palm Beach. Now, says Camilla Tasca, "a lot of our customers who usually travel out of the country in summertime are staying home. People we usually don't see after April are coming in for dinner, and tourists from up north are here too."
Camilla is one of the extended family of Tascas that includes her sister Gracie and brother-in-law Amadeo, plus kids, nieces, and nephews who work in this classic Italian restaurant, known for the "opera nights" it's run for more than a decade and for Amadeo's handcrafted pastas. "We're running a 20-percent-off special for the summer," Camilla says, "and other deals, like no corkage fee if you bring your own wine."
"This summer," she says, "our suppliers are working with us — everybody is in need, everybody wants you to shop, so they're giving good deals." On the Boynton Beach farm where the Tascas pick their tomatoes, the farmers are selling tomatoes cheap — "almost two for one," she says. And new suppliers show up at their door every day, so the Tascas are expanding their list of purveyors.
"We worry more about the fall," she says. Apart from the deepening recession, "it's an election year, so people are being very careful. They don't know what's going to happen. People are nervous. They're very concerned."