When people tell Randy Akerson they’re interested in opening their own restaurants, his initial reply is simple: “Don’t do it.” Akerson, who has run Burrito Bros. Taco Co. in Gainesville, Fla., for more than 30 years, explains why: “Too many people have no conception of the work involved.
“How do you feel about amateur and emergency plumbing?” he continues. “How do you feel about amateur and emergency electrical work? The paperwork requirements and the regulatory requirements grow more and more complex every year. You better know what you’re getting into.”
And yet, despite the long hours, red tape and increasing competition from chains with deeper pockets, independent restaurateurs like Akerson continue to be a fixture in a constantly changing industry.
But the success of mom-and-pop restaurants hasn’t always come easily. It’s been largely dependent on their ability to adapt to their environment and find their niche.
Jim Sellers says adaptability has been critical to the success of his small, upscale restaurant, The Artichoke, in Vinita, Okla., a small town near a large lake that is teeming with boats in the summer but is relatively still in the colder months.
“The biggest factor is that we kept the size small so that we were flexible,” he says of his four-year-old restaurant, which is open year-round. “When it gets down to 7 degrees and it’s misty out, you can cut the staff down.”
The seasonality of the area actually can be beneficial, Sellers says. The community knows The Artichoke will be open when many other restaurants are closed.
“We have people who have standing reservations,” he says. “That’s the nice thing about doing this and this type of food. It fills a niche, and people are willing to see that it’s supported.”
The Gold Rush Café in Dallas has been in business for 28 years, and co-owner George Sanchez says customer loyalty keeps the family-owned restaurant in business. The Gold Rush Café is open for breakfast and lunch, and Sanchez says he has customers who come for both.
“I don’t think you’re as appreciated [at chains] the way you are at a small mom and pop,” he says.“We do appreciate it. We know if we don’t have it, our doors are closed.”
Bruce Phillips, senior economist with the National Federation of Independent Business Research Foundation, stresses the importance of knowing a market before opening a business in one. However, while chain restaurants can afford costly market studies, independents often have the advantage with the familiarity factor, he says.
“If you ask who owns the neighborhood Wendy’s or McDonald’s, people have no idea,” Phillips says, “but they probably know who owns the local sandwich shop.”
Still, visibility isn’t always easy, as many mom-and-pop restaurants can’t afford the advertising that chain operations can.
When Allen Yoder and his family converted a sweets shop in Arcola, Ill., to the Dutch Kitchen restaurant in the 1970s, they knew that being located near an interstate highway and the Rockome Gardens tourist attraction would drive business. It did for years—until more restaurants, most of them chains, started popping up along the interstate.
“There’s a lot more competition now,” Yoder says. “It seems like the franchise people have a little bit of an upper hand in terms of publicity and advertising. The interstate still has a lot of traffic, but there are a lot more restaurants that have popped up, and it’s made it tough on independent restaurants.”
With the Dutch Kitchen located a mile off the highway, the lack of visibility has hurt business.
“It’s awfully expensive to advertise on the interstate,” he says.
Pati Burleson has a similar challenge with her restaurant, Margarita at PineCreek, which also is located off an interstate, in Colorado Springs, Colo.As chain restaurants began to move in near her and in other parts of the city, she started thinking about how independent restaurants like hers would be able to compete.
“Word-of-mouth used to work because we’re exciting,” she says.“We have wait people they know and recognize. Over the years, with a huge number of restaurants appearing and most of them being corporate, people don’t talk about it as much.”
Burleson, who opened Margarita more than 30 years ago, talked to other local fine-dining restaurateurs who shared her concerns, and a few years ago a small group of them formed the Independent Restaurant Cooperative. In addition to sharing advice and occasionally equipment, the group holds monthly wine dinners, which rotate among the various restaurants. To publicize the dinners, the group pools money to buy full-page ads in the local papers.
Sellers of The Artichoke says independent restaurateurs can gain a lot by sharing their wisdom through such organizations as their local or state restaurant associations. Sellers has been involved with the Oklahoma Restaurant Association for years.
“It’s like a local chamber of commerce,” he says. “You can get lots of advice and support from a myriad of sources. Everyone I know in Oklahoma is willing to tell me everything about anything.”
Sellers, who has been in the restaurant industry in various capacities since the 1970s, is also involved with the industry on a national level. He’s a board member emeritus at the National Restaurant Association and serves on the board of trustees for the NRA’s Educational Foundation. He notes that such organizations can provide valuable advice when it comes to complying with increasingly complex regulations.
Phillips of the NFIB notes that taxes, regulations and minimum-wage increases are a major challenge for independent restaurateurs.
“Unlike the big fast-food chains, you don’t have someone to immediately turn to for assistance,” he says.
Akerson of Burrito Bros. says the increasing complexity of regulations on the local, state and federal levels is a constant challenge. Looking forward, he is concerned about the possibility of universal health care mandates that put a heavy financial responsibility on employers.
“That would drive independents like me out of business,” he says.
Even without the threat of universal health care or minimum-wage increases, the future is always uncertain for mom-and-pop operators, especially when it comes to considering retirement.
For Jim Sellers and his wife, Diana, The Artichoke, with its adjacent garden, is their retirement plan.
However, Yoder of the Dutch Kitchen and his wife, Ruth Ann, are ready for a break. In order to spend more time with their children and grandchildren, as well as Ruth Ann’s ailing parents, the couple recently decided to put the restaurant up for sale. They hope someone will see its value and decide to keep it running.
For others, running a restaurant for so long makes it hard to imagine the future. Akerson has been so involved with Burrito Bros., which he bought into and started running when he was 25, that he’s not sure how it would work if someone else were to run it.
“I would imagine that one day I will sell it and go home and weed my turnips on a more regular basis,” he says. “I will be happy, that’s what important to me. But I’m not there yet. I’m not burned out on it.”
