LongmontFYI Logo
LongmontFYI Home
 
Business Logo


LongmontFYI
Business Archive

 

 
back to archive

8/29/2004

Competitive eating

By Paula Aven Gladych
The Daily Times-Call

LONGMONT — The city has developed a taste for eating out, partially fueled by the large number of chain restaurants that have flooded the area.

While some local restaurant owners say they see dips in their business every time a new chain restaurant opens in town, others still view the competition as positive.

Tim McLaughlin, owner of Tim’s Thai at 2939 17th Ave., said having more restaurants means more options and more reasons for people to eat out. If local restaurant owners offer a good, consistent product, they will only benefit from the dining-out trend that seems to have hit Longmont.

Because Tim’s Thai is a “niche restaurant, I don’t even think about the chains,” McLaughlin said. “I feel they are getting people out of their houses and out for dinner.”

Tim’s Thai has seen steady growth since it opened four and a half years ago.

McLaughlin said when a new chain restaurant opens up, his business generally slows down for about a week, “and then we rebound and do fine.”

In the end, it’s all about money, he said, likening what is happening in the restaurant industry to the home-improvement industry. Big-box retailers like Home Depot and Lowe’s have made it hard for smaller businesses to stay afloat because the big stores can offer things cheaper.

“We all have to survive. Everybody has lofty ideas (about shopping only at the independents), but when it comes down to it, money speaks,” McLaughlin said.

Vijay Mehra — owner of Hunter’s Restaurant & Pub and the Silo Restaurant & Sports Bar — has felt the pinch of the chains. The Silo, for example, sits on the southeast corner of the Diagonal Highway and Hover Street and competes with the Outback Steakhouse and the Texas Roadhouse, which sit across the street.

Chains “give the perception they are cheaper, but they nickel and dime you to death. Local restaurants give you a full meal,” Mehra said. “Competition brings the best out of you,” he said, “but I think we have to take away the fallacy that the quality and value of food is better in a chain restaurant.”

He said service is better at local restaurants and management positions are held by local residents.

Jack Evans, co-owner of Longmont’s Outback Steakhouse, struggles with some of the same issues. The Colorado native, who has been with Outback for 10 years, said it is hard having the Texas Roadhouse next door because both restaurants have a “similar menu.”

“I think anything that brings traffic is good,” Evans said. “Anything that brings people to your area is good, but it sure would be great to be the only guy on the block.”

Evans, who owns the restaurant in partnership with the corporation, used to work at Outback Steakhouses in Louisville and Thornton. He said the Longmont location has put a big dent in the Louisville restaurant’s bottom line because many people who used to travel from Boulder to the Louisville location now come to Longmont.

Like the independents, Evans said he doesn’t plan his business around the competition.

“My goals are ... to sell a good-quality product and to make sure the food is right every time,” he said. “We’ve had nothing but great feedback from the guests here in Longmont.”

The Longmont location employs 75 people.

Mehra, who is considering opening a third restaurant in Longmont, said he worries that there are not enough dining dollars to go around in a community with “only 80,000 people.”

According to Longmont’s Sales Tax Division, 177 establishments are licensed as restaurants, cafeterias or catering companies.

The year-to-date sales tax figures for Longmont, as of July, list food organizations as generating $183.6 million in taxable sales. The food category includes bakeries, grocery stores, bars, fruit and vegetable stands, liquor stores and people selling bottled water.

Food businesses have contributed $5.4 million in sales tax revenue to the city of Longmont so far this year.

_ _ _

Downtown Longmont caters to the independents, said Mary Murphy-Bessler, executive director of the Longmont Downtown Development Authority.

“They pick downtown because it has an atmosphere and an ambiance. Local restaurants do well in the downtown area,” she said.

Even with the influx of chain restaurants around Hover Street and Clover Basin Drive, “we continue to open new restaurants down here,” Murphy-Bessler said. “To me, that’s a very positive sign.”

The Pumphouse Brewery & Restaurant at 540 Main St. is in the middle of a $1 million renovation, so its owners “are obviously optimistic they have clientele that will look at an independent downtown restaurant,” she added.

Longmont restaurateur Mike O’Shea said business at his nearly eponymous restaurant Mike O’Shay’s has steadily increased every year for the past 23 years.

“When I went nonsmoking, my food business increased 10 percent,” he said.

O’Shea said he was worried about the chains moving in, but as each new restaurant opened up, “we maintained our own identity. What we do, chains can’t do.”

O’Shea has a hand in every part of his business, including the decision about which food specials to offer on a daily basis.

To take advantage of the low-carbohydrate diet fad, he turned his daily steak special into a full steak menu.

The key, he said, is adapting to changes and trends. “We want to appeal to new people,” O’Shea said.

The big disadvantage to owning a restaurant in downtown Longmont is parking, he said.

“There is no more parking downtown than there was 23 years ago,” O’Shea said.

Sung Kho, owner of Sakura Japanese Cuisine, shares his culinary niche with only one other restaurant in Longmont.

Sakura, in the shopping center at the corner of Nelson and Airport roads, has been in business for six years, and Kho says he and his family try to set themselves apart through exceptional service.

“Every time they walk in the door, we try to give them the best we can,” he said. “Once in a while, we are not 100 percent because it is a busy time or we are too rushed, but I don’t feel good if I don’t make it up.”

Kho believes that as Longmont grows, it will attract more restaurants.

He said he isn’t concerned about the coming competition because “we try to make it something special. ... We want them to enjoy it each time they walk in the door.”

If Sakura continues to do that, people will continue to eat at the restaurant, Kho said.

Pete McLaughlin — owner of Tortuga’s and brother of Tim of Tim’s Thai — said it has been harder to run his business the last couple of years with the “economy (taking) a dive and the chains moving in.”

Many independents have gone out of business, he said: “Some decided it was not worth it.”

This year has been better, he said, but it’s “not like it was three or four years ago.”

Tortuga’s, which has been in operation for 10 years across the street from the Longmont post office on Coffman Street, draws from a “small percentage of the population,” McLaughlin said. It offers high-end dining but in a casual atmosphere.

When the bottom dropped out of the high-tech industry, he said, his business fell off. To stay afloat, he cut back on labor and canceled his company’s health insurance plan, he said.

Because his restaurant is small, it would take a lot to put him out of business, he said, but it gets harder and harder to compete with the chains, which have seemingly bottomless advertising budgets.

“They don’t sweat out a two-year recession like the small guys do,” McLaughlin said.

He said he hoped small restaurants find a way to stay in business until the economy fully recovers.

“A town loses part of its soul when it eliminates mom-and-pop places,” he said.

Paula Aven Gladych can be reached at 303-776-2244, Ext. 211, or by e-mail at pavengladych@times-call.com.