Another one bites the dust
And another one gone, and another one gone
Another one bites the dust
Written 30 years ago by a British rock band, the hit song ‘Another one bites the dust’ is rumored to be about marijuana or gang warfare, but its lyrics could just as easily apply to a phenomenon overtaking the Tahoe-Truckee area: every month, it seems like another restaurant goes out of business. In the last year, at least nine restaurants and one market have shuttered their doors; many more are on the verge. While some restaurant owners say their businesses failed due to the nationwide recession, most believe the current economic slump was simply the final nail in the coffin created by a local economy that has been in a downward spiral for many years. The news isn’t all bad, however. Some establishments have adapted to the economic downturn and found that with a little creativity, they can actually prosper.
It’s the Local Economy, Stupid…
One of the first restaurants to close in the past year was the West Shore’s Black Bear Tavern. Open for almost 10 years, owner Craig Cooper decided to call it quits last August.
‘It had been a long, slow decline that seemed to be visible to me,’ he said, ‘like sitting on top of a hill and sliding down, and realizing you’re going down.’
According to Cooper, he noticed things changing around five years ago, during the peak of the housing boom. Tahoe City locals were being pushed out as housing prices rose and they could no longer afford to live there. Then the labor pool began to dry up. In past years, Cooper used to have up to 40 college students dropping off their resumes in between seasons. But eventually, when rents got too high, those students stopped showing up too. With hardly any local customers and fewer and fewer employees, visitors and second homeowners were not enough to sustain the restaurant. Cooper’s business, which at one point grossed $750,000, dropped to zero.
Cooper said the decision to close Black Bear wasn’t difficult.
‘It eased the pain I was going through to try and keep it open,’ he said, ‘just like it feels so good to quit beating your head against a wall.’
In January, Jay Fallon shut down his Ben & Jerry’s ice-cream shop at the Village at Squaw Valley after three years in business. His reasons are much the same as Cooper’s – a lack of customers, particularly out-of-towners.
‘I’ve seen a change since I moved here of a decrease in visitors and business,’ said Fallon, who moved to Tahoe in 1992.
‘Skier counts are down, and the off-season became a lot softer and a lot longer.’
Fallon knows what he is talking about. He used to own Mother Barkley’s, a breakfast and lunch joint at the base of Squaw, for 13 years before selling it in 2005. Mother Barkley’s was open year around for the first decade, but as the number of customers decreased, Fallon began closing down for half the year.
‘If we had continued to stay open for 12 months, we would have lost money every day in the slow periods,’ he said.
As for Ben & Jerry’s, Fallon said its business was down about 45 percent, depending on the season. But when gas prices hit the $4 mark last summer, impacting the drive market, it was the final straw.
‘Were we going to hang in there for another winter? Absolutely not,’ Fallon said. ‘How many bad seasons can you continue to go through?’
Like Ben & Jerry’s, Sol y Lago in Tahoe City opened in 2006 and closed after three years. Owner Brian Reccow spent $1 million remodeling the old Hacienda del Lago space in the Boatworks Mall only to throw in the towel in January. Joe Lanza, the former owner of Hacienda and an investor in Sol y Lago, said the tapas restaurant closed because Reccow could no longer pay the bills. Lanza believes Sol y Lago’s downfall was its expensive and overly sophisticated menu, which served Latin cuisine from Cuba, Spain and South America. By the time Reccow finally started adding lower-priced items like tacos and enchiladas, Lanza said it was too late.
‘When he started, he didn’t hit the right menu,’ said Lanza, who’s been in the restaurant business for over 30 years. ‘Then when he adapted, the economy closed down on him.’
While the recession played a part in Sol y Lago’s demise, Lanza – like Cooper and Fallon – believes Tahoe’s economy has been in a freefall for a while.
‘This economy has been like this for five to seven years,’ he said.
Reccow would not return repeated phone calls.
No, It’s the Recession
One eatery that didn’t even last as long as Ben & Jerry’s or Sol y Lago was the Tahoe City Starbucks. Starbucks Corp., which was hit hard by the economic downturn, announced in 2008 that Tahoe City was one of 600 stores slated for closure. The store had only been open since summer 2007. The company would not provide specific details as to why the Tahoe City franchise was shut down, only saying that stores identified for closure ‘included locations that were not profitable at the store level and not believed to provide acceptable returns in the foreseeable future.’
Another restaurant that opened in 2007, Stir Crazy Deli in Truckee, is struggling to stay alive. Like Starbucks, owner Scott Leifer attributes the deli’s dire straits more to the current state of the national economy than any local economic trend.
‘We’re definitely down since the recession,’ said Leifer, ‘to the point that it’s a very thin line.’
Leifer and his business partner Peter De Shields, who has been forced to look for another job, have seen their main customer base – locals and construction workers – almost disappear.
‘We’re trying to make it to summer because that’s when business picks up,’ he said.
While it may seem that most of the restaurants unable to weather the economic storm are newer businesses, even some landmark dining establishments are feeling the pinch. Tahoe City’s Christy Hill, which has been open for 30 years, was set to close in January until summer.
‘It’s the slowest I’ve ever seen it,’ said manager Kristie Scarborough, who has worked at the high-end restaurant for 14 years. ‘There were nights when nobody was coming in.’
At the last minute, owner Debbie Macrorie decided to keep Christy Hill open in order to support the community and her employees, some of whom have been with her since day one.
‘She decided to grin and bear it,’ said Scarborough. ‘She’s probably not getting rich, but at least we all have jobs.’
Adapt or Die
While some restaurant owners have decided to suffer through the bad economy, others are reinventing their businesses to match consumer’s shrinking wallets. Fine dining restaurant Christy Hill is trying to remake itself as a more affordable place for locals. Its All Night Happy Hour, every night from 5:30 to 9 p.m. in the bar, offers half-price off the bar menu and a house wine for $5. Mid-week in the dining room, customers can opt for the ‘$40 Chef Special for Two,’ which includes two entrée choices and two glasses of wine. The offer runs until the end of May. (See ‘A Glimpse Back and Vision for the Future’ in the Soul Kitchen section.)
Dean Parra, owner of Syd’s Café in Tahoe City, saw the writing on the wall last summer when his One Dollar Wednesdays, which feature a reggae DJ and $1 beers, took off.
‘I saw the potential to use the clientele – ski area employees and people who don’t make a lot of money,’ Parra said. ‘In Tahoe City, there is nothing else for them to do at night.’
This season, Parra decided to stay open at night for the first time during the winter and added even more evening events, such as Raffle Night on Tuesdays, where they raffle off new snowboards and skis, Thursday night karaoke and live music on Saturdays. To say the move to stay open until 2 a.m. five nights a week was a success is an understatement – Syd’s night-time revenue now outpaces its staple morning bagels-and-latte income. Overall, Syd’s business is up from last year. And Parra knows why.
‘Look back to any failing economy, and they call it a depression for a reason,’ he said. ‘People want to find some release. The cheapest release is what I am.’
This is not to say that Parra has not been affected by the economy. He opened a second store in Truckee in August, only to shut it down after five months. The Tahoe City Syd’s experienced the slowest season of all time last fall, when business was down 25 percent for three months. And the cost of goods has gotten so high that sometimes, Parra says, closing almost seems like a better idea than staying open and bleeding money.
Parra says he is now digging out of the hole caused by the sluggish off-season, thanks to re-inventing Syd’s as a place to come for beers and entertainment, not just coffee and a sandwich.
‘We as business owners in Tahoe City are not getting business handed to us as in the past,’ he said. ‘Now you have to work for it in creativity.’
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