Can you feel the tide beginning to turn? Suddenly, it seems, people everywhere are talking about shifting currents and pointing to some long-awaited signals of an economic rebound.
In my town, the phrase “Sale pending” is replacing “For Sale” on the realtor signs that have remained stubbornly rooted in front of properties for ages. More acquaintances are considering—and, more important, making—big-ticket purchases, and several have even embarked on home construction projects.
That’s not to say that all boats are rising nor that the waters are not bound to be choppy, especially as the national unemployment rate—an all-important metric to recovery—remains lodged near 10 percent. According to the Bureau of Labor Statistics, in March the national unemployment rate stood at 9.7 percent for the third straight month, a sobering reminder that widespread prosperity is still waiting in the wings. Just about everyone is anxiously anticipating April’s figures.
Still, keeping all things in perspective, our collective mood appears to be lightening. Operators say more people are dining out in early 2010 and have the first-quarter results to prove it. As reported on
Notably, The Cheesecake Factory, one of the more upscale and pricey concepts in the hard-hit casual-dining segment, reported for the quarter ended March 30 that increased traffic helped to boost same-store sales to positive territory for the first time since 2007, up 2.7 percent for its 148-unit namesake brand and 4 percent at 13-unit Grand Lux Cafe.
In a conference call, Cheesecake’s chairman and chief executive, David Overton, noted that customers had begun to buy appetizers and desserts, and that alcoholic-beverage sales were improving, evidence that discretionary spending is starting to loosen. To be sure, that’s a good omen for many.
You can hear the growing optimism from others as well. Some operators are raising their earnings guidance for later this year, while others are pulling out of survival mode and looking for “the one thing” that will prepare their businesses for renewed growth. That’s what we heard when we talked with restaurateurs who are headed to Chicago for the National Restaurant Association Restaurant, Hotel-Motel Show later this month.
As you can read in the special report that begins on page 1 and continues in the Business Intel section, many operators are tackling the show in groups as they search for the big idea that will jump-start their businesses. Certainly, no one is throwing caution to the wind, and “return on investment” is an oft-repeated mantra. But more people clearly are emerging from their deep entrenchment.
Speaking of return on investment, Steve Rockwell in his column urges mature companies to consider providing strategic financing to smaller capital-challenged peers in the way P.F. Chang’s is helping out True Food Kitchen. As Rockwell points out in his column in the Finance section, the payoffs are many.
Restaurateurs who are looking for incremental sales without huge investments—and who isn’t?—can learn about some innovative strategies in a story exploring drop-ins and clip-ons in the Operations section.
In the same section, training guru Jim Sullivan stands on its head the long-held industry belief that employees are motivated more by recognition than money. His column is a must-read with a message that all operators should keep in mind as they rebuild their staffs—or labor to keep employees from bolting for better opportunities as they unfold.
The time for new beginnings seems to be approaching. That’s fitting for a spring that many people seem hopeful will segue into a summer or fall of smoother sailing for all.
