People Eating Out More, But They’re Pretty Selective

Local restaurant owners are seeing glimmers of hope for a recovery in their industry but customers are being choosier with their dollars and searching for added value. A survey of California by the National Restaurant Association found that 44 percent of those restaurants responding expected sales to increase in the next six months vs. the same period last year. Only 18 percent expected sales to be lower and 39 percent expected things to stay about the same. Madelyn Alfano, president of Maria’s Italian Kitchen, is among those optimistic. The Van Nuys-based chain has seen a 2 percent increase in dinner traffic over last year but a 1 percent decrease in lunch traffic. She said customer traffic was about the same compared to last year, but the level of take-out is up. “Take-out enables people to take things home. There is no need to buy beverages or tips which can get expensive,” Alfano said. Alfano emphasized ways her chain has offered an added value to customers, increasing sales at her restaurants. One of these options is a “half portion” – an option she introduced two years ago to cater to the needs both of people being healthier and the downturn in the economy. These “half portions” end up costing more than half for the same amount of food, but Alfano still said they have become her most popular sellers. For example a full-priced chicken parmesan costs $15 while a “half order” costs $10. In recent months sales on these portions have almost doubled. However, she said that she still does not make as much profit on these half portions as she would on full portions because the price is less. This is despite the fact that the food costs would be less due to smaller portions. Power meals Alfano also offers the power family meal: large meals of chicken, salad and pasta for corporate clients or families. These meals are designed to serve 10 to 12 people and cost $90. At $10 or less a person Alfano said they are a popular seller. Alfano also said staffing levels at her restaurants are stable. Betty Porto, Vice President of Community and Guest Relations at Porto’s Bakery, also expressed optimism about the industry. Porto’s 30-year-old Glendale location has seen customer traffic increase 8 percent over this time last year. “We’re always very optimistic,” Porto said. Porto said she has seen an increase in wedding cake sales, which she attributes to the fact that people are having smaller more intimate weddings because of the economy. As a result she says people are more conscious of their money and she said Porto’s is known for affordability. Porto’s also has seen $20 to $30 per customer of takeout in the afternoon, an increase in that category, according to Porto. Porto says values at her restaurants are consistent such as $5 for a full meal including a sandwich and a drink. “What we sell is unique. We know the customers are families,” Porto said. Porto said they promote their business through giving free samples of their foods such as bread. “If we decide to push an item then other items don’t do as well. But it’s an easy way to bring up sales,” Porto said. Porto said hiring at her business is stable. Business recovering At Brent’s Deli, co-owner Mark Hernandez said that their business hit its low in early 2009, but by the final quarter in 2009 it had gradually started to recover. That recovery has continued through today. Business may be up for them in 2010 over 2009, but still has not reached 2008 levels, according to Hernandez. Hernandez said business had stayed consistent, except for a decline in corporate catering and lunchtime business due to the downsizing of Countrywide Mortgage and the sale of now defunct Washington Mutual. “Corporate catering was 30 percent of my business in 2007 and now is 25 percent of my business in 2010,” Hernandez said. Hernandez said hiring numbers have increased, another positive sign for Brent’s Deli. He hired three more employees at their Westlake Village location and seven more employees in Northridge over the last year. “We were hiring people and feeling confident in hiring people,” Hernandez said. Owner Ray Vega of Casa Vega in Sherman Oaks said that customers are buying less and he expects that to remain consistent in the near future. Vega said that they serve 400 to 500 more customers per week than a year ago but despite that increase, they are taking in 5 percent less sales. Vega said customers that used to buy two to three drinks are now purchasing one drink to save money. Happy hour is one way that Vega offers value to his customers, he said. “Purchases are more carefully selected than they were in the past,” Vega said. “Waiters and bartenders are more conscious of customer service.”