Restaurants Thrive in Slowing Economy

For the most recent 11 months recorded, Fayetteville’s leading restaurants surpassed sales figures for the entire calendar year 1999.

The figures contrast with the general perception that the economy is slowing nationwide. That slowdown may have hit area restaurants in November, but sales tax figures aren’t yet available to know for sure.

From December 1999-October 2000, Red Lobster had $3.13 million in sales, up from $3.01 million for all of 1999.

Jose Inc., which consists of Jose’s Mexican Restaurant and Bordino’s, had $3.05 million in sales for the 11 months, compared with $2.95 million for all of 1999. Joe Fennel, the owner of Jose Inc., would not break down sales between Jose’s Mexican Restaurant and Bordino’s, saying they are one restaurant operating under one roof.

Red Lobster and Jose’s were No. 1 and No. 2, respectively, in sales for 1999.

Fennel attributes the sales growth to the “revitalization” of Fayetteville’s Dickson Street (where Jose’s and Bordino’s are located), efforts by the Chamber of Commerce and Downtown/Dickson Enhancement Project to bring festivals to the area, and moving “quality football games” to Fayetteville this year.

“Dickson Street is a happening place to be,” Fennel said. “There are two primary places you want to build a restaurant in Fayetteville, Ark. — Dickson Street and out by the [Northwest Arkansas Mall].”

But Fennel is cautious about the future. He and other restaurant owners agree that sales dropped in November.

“When Nov. 1 hit, it was like the wheels flew off,” he said.

As a result, Fennel is predicting a 5 percent sales growth for his restaurant in 2001. That’s a considerable drop from the 12 percent growth he had this year.

“I’d rather be conservative rather than get out there and get hit upside the head and not know why you’re taken out,” Fennel said.

For all restaurants in the city combined, sales totaled $97.3 million for the 11-month period. Sales for the entire year will surely exceed the total of $98.7 million for the 12 months of 1999. In 1998, sales at all Fayetteville restaurants totaled $90.2 million.

Although it appears to be an apples-to- crab apples comparison, we followed the city of Fayetteville’s method of recording hotel-motel-restaurant tax collections when we included December 1999 to the months of 2000 for which statistics were available. The tax records are used to derive sales figures for the restaurants. October is the most recent month for which the city has collection figures. The city includes November sales in it’s yearly totals.

The top eight restaurants remained the same in 2000 as the previous year. Rio Bravo Cantina and the McDonald’s at 1641 College Ave. dropped out of the Top 10 this year.

They were replaced by Chick-Fil-A at Northwest Village, across from the Northwest Arkansas Mall, and Powerhouse Seafood Restaurant.

Three locally owned restaurants were in the Top 10 this year: Jose’s, at No. 2; Ozark Brewing Co., owned by John Gilliam, at No. 5; Powerhouse Seafood, at No. 10, owned by Layne Caudle and Trish Heckathorn.

Caudle and Heckathorn bought Powerhouse Seafood in December 1999 from Bill Underwood, the Fayetteville jeweler, but the couple had actually been operating the business since June 1999.

Red Lobster, which has remained No. 1 on our list for the past two years, is a chain owned by Darden Restaurants Inc. of Orlando, Fla.