April 7, 2009

Collegetown Restaurants Adjust as Sales Decline

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Compared to typical, economically thriving times, Collegetown restaurants have seen fewer customers enter their establishments while their costs of operation continue to increase during the current recession. In order to continue earning a profit, Collegetown restaurants and bars have had to change many of the details of their operation.
Collegetown’s more formal restaurants seem to be most effected as students look to spend their money more efficiently. Once a popular weekday lunch spot for Ithaca’s locals, the Japanese restaurant Miyake’s weekday sales are reportedly down about 20 percent compared with this time last year as it has been forced to rely on increasingly frugal college students to sustain its business, according to its owner.
“Miyake has encouraged group dinner parties for college students and we have seen an increase in business on Friday and Saturdays,” Jung Mi Choi, the restaurant’s owner, explained, “But our regular customers are down … and it has been very difficult to cut even.”
Choi also pointed to a decrease in visitors to Cornell — another important customer for Miyake — as a reason for the drop in business.
“Normally there are more parents and tourists at Cornell who stop by the restaurant,” she stated. “But possibly because of gas prices or other costs to come up here, I have seen much less.”
Pita Pit has also had trouble maintaining its customers. Laura McDougall, the restaurant’s co-owner, claimed that she has seen a “noticeable difference” in sales since January. To combat the drop in store traffic, she has attempted to create new specials and increase the number of advertisements in the local newspaper and Ithaca entertainment guide.
The bars, too, have seen a decline in sales. An anonymous bar manager explained that overall profit was slightly down during the winter months. In addition, Level B hasn’t had the increase in spring patrons that they have come to expect year after year.
“Sales haven’t really dropped off, but usually in the spring you get an increase as more people turn 21 and seniors enjoy their last few months at Cornell,” Brad Weiss, Level B’s manager, said. “At least in the past couple of weeks, we haven’t noticed that increase in sales that we normally get.”
Yet the bars may have less reason to worry than their restaurant counterparts, as they are able to maintain low operating expenses by not offering food.
“On average, our ability to keep our establishment running is a lot easier than other places because our costs of operation are lower,” a bar manager who wished to remain anonymous said. “If our numbers were to drop slightly it’s not as big of a deal as other places that have to deal with food costs.”
Despite mounting food expenses, venues like the newly opened Green Café and Collegetown Bagel are still finding success by offering a variety of products to choose from. Green Café was pleasantly surprised by the amount of business it has already received, especially in this economic environment.
“We’re actually doing really great; we didn’t expect so much business so early,” Jeong Kim, one of Green Café’s managers, said. “It was overwhelming in the beginning; we really didn’t expect such an overwhelming response from the students. But we believe that it is partially due to the complete variety of food that we offer.”
Collegetown Bagels also has not lost any major business although it has had to change the way that it operates. CTB owner Gregar Brous explained that CTB had to switch from a “market-driven” café to a “cost-driven” one.
“One of our biggest challenges is on the expense side of our business; we have never had such a broad based increase in prices across the board,” he said. “Whereas before the recession, it didn’t matter as much what product we sold as long as the customer liked it, now we have to really look at how much it’s going to cost us.”
CTB is largely concerned with finding the right producers. When the bottled water company “Evian” decided to raise its selling price, Brous chose to switch to Poland Spring.
CTB has also found less conventional ways to save money. When the restaurant noticed that it was charged for each individual garbage pick-up, CTB decided to allow its garbage to pile up a bit more before it was taken, thereby further reducing costs.
Collegetown’s major fast-food chains seem to be having the easiest time as more and more consumers look to buy cheaper products. Collegetown’s Subway reportedly has earned a greater profit this year than last year for the first quarter, according to its general manager.
“The $5 foot-long sandwich really draws customers in,” Laurie Foster, Subway’s general manager, said. “And the Subway brand pretty much carries itself in terms of consumer recognition.”