Middle-of-the-road chain restaurants decide the working and middle classes are too broke to eat out.

[marmar]

(Bloomberg) Red Lobster is trying to create the ambiance of a small, seaside town in Maine as it rolls out a three-year remodeling plan for its 700 U.S. and Canadian restaurants.

The seafood chain is the latest eatery to spruce up its menu, décor and architecture to lure consumers who can afford to eat out more frequently. With economists trimming growth forecasts and unemployment at 9.1 percent, restaurants are becoming increasingly dependent on households earning more than $70,000 to keep sales growing, according to Malcolm Knapp, a New York-based consultant who has monitored the industry since 1970.

“We’ve really become an ‘allocation nation,’ where every month, people look at what’s left from their paycheck and decide how they’re going to spend that money,” said Knapp, creator of the Knapp-Track Index of monthly restaurant sales and guest counts. “Restaurants are re-conceptualizing their brands to appeal to a broader demographic.”

Americans in lower-income brackets have been forced to cut back on dining out to live within their means, according to Robert Dye, senior economist at PNC Financial Services Group Inc. in Pittsburgh. Real disposable incomes, the money left over after taxes and adjusted for inflation, are essentially flat since December 2010, he said. Meanwhile, more-affluent households are benefiting from higher dividend payments and earnings from rental properties, which have grown 10 percent and 20 percent, respectively, since the September 2009, Bloomberg data show. ............(more)

The complete piece is at: http://www.bloomberg.com/news/2011-06-09/high-unemployment-makes-ihop-to-red-lobster-target-higher-income-customers.html

[Liberal_in_LA]

1. sign of the times

[csziggy]

2. Maine ambiance for a restaurant chain that started in Florida?

Red Lobster started in Lakeland, Florida! Why don't they go with their origins instead of pretending to be something they are not?

Lawton Chiles, former Senator and Governor of Florida, was a part owner of Red Lobster. I am not sure who owns it now. My grandmother used to treat us to dinner at the first Red Lobster for special occasions before they became a chain.

[customerserviceguy]

54. Chain restaurants are all about the idea of selling a fake experience

I still eat at a couple of local chains, like the Charlie Brown's chain in the NE, and Burgerville, USA when I go back to the NW. If they ever went national, I doubt that they'd be able to keep the positive attributes that they have now, the 'suits' would adulterate the basic concepts to the point where they were unrecognizable.

Eat local, save a local businessperson who puts his/her money in the local economy.

[NYCGirl]

3. They might want to forget the remodeling and serve better

food.

http://vimeo.com/23515096

[cloudbase]

4. Plastic fish

hanging from nets pinned to the walls. Can't wait.

[Old and In the Way]

5. Next year, we'll be hearing about vending machines going upscale.

Eventually, they're all going to end up chasing the discretionary dollars of the top 3%. Unfortunately, those people can't eat many more meals, consume more appliances, cars, clothes, or jewelry than a typical person in the bottom 95%. An economy that caters to 5% of the population is a dead economy.

[ejpoeta]

8. they already have those. i saw those on a story probably on the today show or somewhere.

vending machines with cell phones and all other kinds of high end crap in them.

[tabbycat31]

20. there was a vending machine at my local mall that sold ipods

Not sure if it's still there, I'm not exactly one to hang out at the mall these days.

[Raine]

22. Some have ... I have seen cappuccino and espresso

available from vending machines.

[Edweird]

28. The Mondrain hotel in South Beach (Miami) has one. Pretty cool.

It does have some adult stuff in there and when I was there with my girlfriend at the time her 14 year old daughter pointed out the 'submissive package' or whatever. Girlfriend was freaked out that daughter was on to us......

[Arctic Dave]

6. Chain restaurants pretty much suck.

Giving them a fresh coat of paint won't help.

[Enrique]

13. except for Olive Garden

:hide:

[Arctic Dave]

15. Depends if it is Pit Bull Tuesday or not. :P nt

[Codeine]

17. Go for the maulings, stay for the breastfeeding. nt

[Arctic Dave]

18. Either way, I'll need a cigerette afterwards. nt

[TheCowsCameHome]

21. Always request the Circumcision Section.

You don't have to worry about a leaving tip.

[Arctic Dave]

23. ROFL.

I DID NOT see that coming.

[JNelson6563]

61. omg lolz

[robertpaulsen]

67. I prefer the six refills of coffee section.

[kentauros]

33. How about an e-cigarette?

Ordered by eSlate and then your purchase is E-Verified :P

[JNelson6563]

59. lolz

[femrap]

31. So you're kidding, right? nt

[SmileyRose]

46. Best subthread EVAR !!!! elevens !!!!

[ejpoeta]

7. I try to avoid chain restaurants when I can with a few exceptions. But I don't like seafood anyway

so no red lobster for me. As if I could ever afford to go there anyway. The last time I went to a 'middle of the road' place my husband's boss paid for it... he had to work on a sunday before he had to leave for training for two weeks so his boss got to buy us dinner. that was applebee's... which i despise and refuse to go to now. yech. went there a couple of times and then thought about it and realized it was overpriced and tasted yech. no thanks. try to go to family establishments that are not chains. this does not exclude chains.... just prefer to patronize the regular restaurants if i can.

[HockeyMom]

9. No chain can compete with a REAL small seaside

restaurant in Maine. If you have been to one, Red Lobster will be severely lacking.

[TheCowsCameHome]

10. Just redesign the menu cover and paint the joint.

That'll work.

If I want real seaside ambiance, it won't be at Red Lobster.

[Enrique]

11. i just read that the ad industry is focusing on the rich

for the same reason. They're the only ones who can afford shit.

[JVS]

12. This is going to hurt the customers who order the cheapest dish and load up on cheddar bay biscuits

[arikara]

14. Chains are awful

the food is all mass pre-cooked and the "cooks" only have to heat it up. May as well buy a TV dinner for a lot less money.

[femrap]

32. Yep....it's all delivered to the

restaurants by Sysco....a horrid food distributor who loves salt.

[arikara]

63. Sysco food is so gross

it all tastes exactly the same, and way oversalted as you say. After one of those meals I need to drink a gallon of water before bed and then don't even have to get up in the night to use the biff.

[Codeine]

16. People with money won't eat at that shithole, regardless of how many

millions they spend remodeling it.

[Lost-in-FL]

19. You can put lipstick on a pig but it is still a pig... Or how mom used to say...

"Aunque la mona se vista de seda... mona se queda"

[Octafish]

24. We'll always have Golden Corral.

[Name removed]

30. Deleted sub-thread

Sub-thread removed by moderator. Click here to review the message board rules.

[barbtries]

69. is it bad

that i love breakfast at the golden corral? and BoJangles? i only found these places after moving to NC. all right, it's bad. i've put on so much weight out here...

i even kind of loved waffle house for a while, but the bloom is off that rose.

[Raine]

25. Really I can't say as I blame them

anymore you're on your own and it's survival of the fittest. At least they employ people who will still have jobs if their upscaling works.

[pitohui]

26. what was their first clue?

however, in the reality based universe, there is no sprucing up that a red lobster or an olive garden can do, with no middle class, they are dead, rich people won't eat there no matter how "spruce" they are, fuck it, middle class people wouldn't eat there if they had a choice

[GKirk]

27. Well there is always the McDonald's Dollar Menu...

...for the rest of us.

[eilen]

64. Last night I had to work late and dh was too exhausted to

figure anything out. I had forgotten to take something out of the freezer before I left for work. We agreed I should pick something up. I went to Wegmans where they have $6 meals. I ordered Coconut Almond Tilapia, squash medly and a black bean cake/croquette? and another meal of stuffed eggplant with the same sides. Then I went through the MCD's drivethru for my teenager who doesn't like $6 meals and ordered 2 Big Macs--no value meal which came to about $8.

So all in all, about $20 to feed the three of us, could have been cheaper if my kid was not such a picky eater.

I highly recommend the Wegmans $6 meals. They have quite a variety of entrees and sides and it's not junk, it is good healthy food. Screw Red Lobster. At Price Chopper I can pick out my lobster and they will prepare it and it is way less than what Red Lobster charges. I get to go home and eat it without some kid screaming in my ear or being seated next to the bathrooms.

[GKirk]

73. Not sure what a Wegmans is but

I actually do order off the dollar menu at Mickey D's alot; dollar frie and a McChicken no mayo.
Yesterday I used a coupon for buy one get one Quarter Pounder/Big Mac and was shocked that they charge $3.99 for either of
those sandwiches. I'd rather get two McDoubles for 2 bucks.

[femrap]

29. I'd rather have a good home-cooked

burger or pasta dish or steak than go to these crappy places. And I can fix a great salmon dinner as well....

[Luminous Animal]

34. Quality-wise? Definitely. When I eat out, I want to eat tasty food that I do not

have the skills to cook myself. Mostly, Vietnamese, Thai, or Chinese. If I eat out for seafood or pasta, which I love, it has to be an amazing restaurant with a cooking execution beyond my culinary capabilities.

That ain't Red Lobster or Olive Garden.

[femrap]

56. I see you're

in SF...lived there for 15 years. And I certainly left a piece of my heart there. I so miss the food and the weather.

I can no longer get decent Mexican, Thai, Chinese....really, nothing. So I have to cook. I am surrounded by nothing but Chain Restaurants.

[Scout]

60. "I am surrounded by nothing but Chain Restaurants"

oh the humanity! how do you manage to get out of bed every day?

[Codeine]

37. I only eat out when I want something I can't manage.

My falafel sucks, for instance. When I crave falafel I don't bother trying to make it, I shoot over to a place where a nice Lebanese couple makes the best falafel on Earth. Same with Indian food -- my aloo gobi is never gonna measure up to the stuff at Ravi's Indian Food.

[LibertyLover]

57. Congratulations on being able to afford salmon

Some of us can't.

[Stevenmarc]

35. Thankfully I live in NYC and don't have to endure chain restaurants

[customerserviceguy]

55. Amen

Even if you live within half an hour of NYC, you have an amazing array of non-chain choices.

[Maine-ah]

36. Red Lobster is a joke up here.

I think the last one may be in Portland.

[Luminous Animal]

39. It is a joke everywhere where people don't have options.

[saras]

38. Restaurants are one of those stupid ideas we haven't examined closely

They have little or nothing to do with the inns they started as, and seem to support unsustainable lifestyles in general.

[Lydia Leftcoast]

40. The advantage to living in a city is that you have non-chain restaurants within

walking distance.

I have four within five minutes' walk, three more within twenty minutes' walk, and about six more within forty minutes' walk.

The only time I go to chain restaurants is when I rendezvous with my suburban relatives.

[kentauros]

42. "Walking distance?" I'm not familiar with the term

;)

That is, I live in Houston. It's not that we don't have excellent restaurants; we do. We just don't have any place that is within walking distance of anywhere else, except inside of malls. And other than The Galleria, that's suburbia.

Of course, you may not believe me about the quality of our restaurants, so look here and you might want to visit sometime :D

[Lydia Leftcoast]

51. I live in what was once a streetcar-oriented business district in Minneapolis

I chose it specifically because all the necessities of life are either within walking distance or a bus ride away. I have a car but hate to drive, and for that reason, I would never choose to live in a city like Houston, no matter how wonderful its restaurants, because it's totally oriented towards cars.

[kentauros]

53. I'm not asking you to live here,

but you might want to visit sometime :hi:

I live here because I grew up here and love the city. Sure, it's big, but you just get used to that, or learn not to complain about it ;)

[KatyMan]

66. "totally oriented towards cars"

Aren't most cities that came to prominence in the 20th century?

[Lydia Leftcoast]

71. No, Minneapolis, has a comprehensive bus system, although it has lots of flaws,

and Portland, Oregon is easy to live in without a car. Seattle is gradually trying to catch up.

Even Los Angeles has a decent bus system, although many Angelenos think they're "too good" to ride it. The same is true in Atlanta, where the MARTA system has a racist nickname.

Otherwise, the Sunbelt cities are the ones without decent public transit.

[KatyMan]

65. Houston suffers from people's perceptions of Texas...

It gets forgotten that Houston is the 4th largest city in the country, with the largest theatre and arts district outside of NYC, and an international culture to rival any US city. Great architecture,great arts and museums, great zoo, NASA....and the food is great. Not to mention the low cost of living.

I think, kentauros, you can guess where I live ;)

[Manifestor_of_Light]

70. Yo!! Born and raised in houston, here.

Now living in Redneckistan away from civilization.

I got a great musical education, between the rock and jazz acts that came through Houston and the symphony, and the Armadillo in Austin. i went to college in San Antonio and drove to Austin to the Dillo to see the big name acts.

[kentauros]

77. Hi KatyMan!

So, do you live in "Old Katy" or some of the newer subdivisions? I haven't been out that way in a long time, and it was usually for going to work at the Park 10 complex.

Is the duplicate miniature Forbidden City still there? I heard it was falling apart from neglect, so have wondered if anyone stepped up to refurbish it.

One of these days, I'll go down to Pearland to visit the Hindu temple there. Talk about a contrast! (Pearland, for those that don't live around here, has a history of being more conservative than even the surrounding white-flight suburbs.)

[musette_sf]

75. Houston has AWESOME restaurants!

I mean, it's so damn hot that restaurant dining is a primary form of entertainment.

Right now I'm missing Goode Company Seafood on Kirby.... yum....

[kentauros]

76. When I still ate any kind of meat,

the Goode Company seafood restaurant was the one to go to. I suppose the Pappas restaurants give them some competition, but I think that's primarily from the "I expect to take home enough food for my money for three more meals" crowd ;)

[arcane1]

41. Do you know who does NOT "look at what’s left from their paycheck and decide how..."?

The RICH!!!!

[Zenlitened]

43. THANK YOU. That's the line that jumped out at me, too.

...where every month, people look at what’s left from their paycheck and decide how they’re going to spend that money,” said Knapp, creator of the Knapp-Track Index of monthly restaurant sales and guest counts.

Yeah, he's an industry hack, but there is some depressingly real truth to his statement.

Does anybody ever look at what's left... and let it pile up in a savings account?

[arcane1]

44. Indeed, I make that decision with every paycheck.

Red lobster never makes the cut :)

[MadHound]

45. Hell, I haven't eaten at Red Lobster in years and decades,

I think I've been there twice in my life, horrible food, tacky place. Such a makeover isn't going to convince me to come rushing in.

In fact I rarely eat at a chain restaurant, the food is generally of low quality. I would rather eat at a local place, even the local mom and pop breakfast diner. Food is generally better, the people more interesting.

[AleksS]

47. He's missing a very important bit:

He's missing a very important bit: The people Red Lobster looks to be catering to in the future...

won't go to Red Lobster. Among the wealthy crowd, RL is kind of a joke. RL made it's mark by being a solid consistent seafood place a middle class couple or family could go for something special.

When wealthy folks go out to eat, if they're looking for seafood, RL isn't going to make the list no matter what decor they choose to go with. It's not a Gordon Ramsey "Kitchen Nightmares" episode. The folks with $$ will go to seafood restaurants with real chefs, and genuinely exciting menus. And if RL decides to abandon the folks that made it a 700-restaurant mega-chain, well, then they deserve everything they lose by the move.

[JVS]

48. They're not going to be targeting really rich people, it's going to be $70k/ year people and up.

Instead of having entrees that span from $18-$30, they can let prices go up to $35-$55 and use some of that increase to improve the quality.

I don't know why everyone misses that the first element of "The seafood chain is the latest eatery to spruce up its menu, décor and architecture..".

Also, the group they're going for is still a group that works most of the time. This means that when they're traveling on business and don't know where to go, they'll know what Red Lobster has to offer and what quality level it will have.

The big question is if Red Lobster's will be able to pull off an upscaling of its image. On one hand they have a lot of customer recognition, on the other hand it's not all positive.

[Atman]

49. Nailed it.

RL would never, ever be my first choice -- or second, third, or even tenth choice. Being in New England, we have roadside clam shacks and Mom & Pop joints I'd hit before I'd step foot in a RL. And if we want fancy, there are also many to choose from. I don't know how RL even survives up here. It's like going to a Taco Bell in Mexico.

[NashVegas]

58. There Are Plenty of Engineers/IT Types

With specialized educations to be high income-earners, but that education doesn't extend to telling the difference between the preparation of high-end ingredients when it comes to fast-food verses slow.

Nor do they care.

Many would rather eat at proven national chains than attempt a dining adventure in a room full of people they perceive to be elite snobs.

[Manifestor_of_Light]

68. Christie's on Westheimer is good.

Speaking of Houston. Good seafood.
I love red snapper!!

[kentauros]

78. I thought I'd heard that Christie's was going to shut down.

And then I saw they were still open. I don't know what happened, but they do boast on their sign that they've been in business in Houston since 1917 :)

http://christies-restaurant.com/main

[demgrrrll]

50. If you hurry Restaurant.com has a twenty five dollars for 2 dollars

special the promo code is deal Great site when they have the specials and good food at good restaurants be sure and read the fine print to see what the restrictions are on each individual restaurant.

[izquierdista]

52. Another industry folds up

As the American middle class disappears, there won't need to be any restaurant industry catering to all these various niches, since there will only be one niche, the top 1%, who will be doing all the dining out.

I'm thinking of the time I lived in Ukraine, where a large town of a couple hundred thousand may only have a half dozen real sit-down restaurants. Even then, they only qualify as small bistros by American standards. Service there is very slow, since customers are very sporadic and they only start cooking when you give them your order. Sit-down restaurants are out of the question when the average worker's wage is $200 a month. So are fast food restaurants. So eating out usually means going to the shashlik or chebureki kiosk at the marketplace for takeout.

[lumberjack_jeff]

62. There's plenty of money. It's just going to fewer and fewer people.

Businesses can continue to prosper by targeting those few who have the money.

The end point is Red Lobster having one table, colocated at the winner's villa.

[JoePhilly]

72. Apparently no one reading this OP has also read the article.

Or thinking much.

1) Renovating a restaurant costs money. That means JOBS.

2) The stock value of the companies involved are up PRIOR to renovations. From the article ... "The Standard & Poor’s Supercomposite Restaurants Index, which includes McDonald’s, Ruby Tuesday and 25 other companies, has risen by 44 percent since Dec. 31, 2007, while the S&P 500 Index has declined by 13 percent."

Clearly these companies are desperate to renovate.

3) They include these examples, which have nothing to do with trying to obtain upscale customers ... "Ruby Tuesday Inc. (RT) recently rolled out menus with entrees under 700 calories such as a spaghetti-squash marinara, Chief Executive Officer Sandy Beall said on an April 6 conference call. Meanwhile, Denny’s Corp. (DENN) launched a new campaign -- “America’s Diner is Always Open” -- to position itself as an eatery with “great hospitality and great comfort food at a great price,” Chief Executive Officer John Miller said on a May 3 conference call."

Do only wealthy people like healthy food? And are they looking for “great hospitality and great comfort food at a great price,” ?? Doesn't sound like Denny's is seeking people making over 70k to me.

4) The article includes this ... "Chili’s Grill & Bar, owned by Dallas-based Brinker International Inc. (EAT), tried to remodel its stores prior to the recession and didn’t achieve desired sales gains, so it pulled the plug on the initiative, West said."

Huh? They remodeled some,saw no effect, and stopped. Is Chili's anti wealthy people?

5) I like what the "consultant" says at the end of the article ... "“Restaurants have to have a more contemporary and elegant interior, as well as exterior, to appeal to a higher demographic,” Knapp said. “At the same time, they have to make sure it’s not too nice to deter their other customers.”

Why would they need to make sure its not "too nice" for their other customers??

After all, as the OP title indicates, "Middle-of-the-road chain restaurants decide the working and middle classes are too broke to eat out."

So why not make it "too nice"????

[Forkboy]

74. Funniest thing about my time living on Cape Cod was seeing people go into a Red Lobster.

:crazy:

[Canuckistanian]

79. Oops! They're going to have to outsource more of their suppliers

Because Americans can't find work.

Ironic, don't you think?