Updated 10/07/2008 03:05 PM
Restaurant Industry Responds To Economic Downturn
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The 2009 Zagat Restaurant Survey, now on shelves, is celebrating a big anniversary. For 30 years, diners have been doubling as critics, offering readers a taste of their opinions.
The new guide comes at a tough time for city eateries. Co-founder Tim Zagat says the financial crisis is taking a bite out of the restaurant industry.
"It's not good and it's probably the most threatening thing that has happened," he said. "But we've seen the industry, which is extremely strong, come through times that were equally difficult."
Zagat says diners are more price-sensitive and more value-oriented in this economy. A recent survey found 38 percent of people are dining less, 28 percent are skipping appetizers or desserts, and 21 percent are cutting back on alcohol.
Still, Zagat says you now have more options to eat well, for less.
"Prix fixes at some of the best restaurants in the city are available for $24," Zagat said. "Like the restaurant week, where a couple of hundred restaurants will do this, that's been an enormous success. The restaurants have learned that they can make a profit by making meals available all year long at $24."
Paul Bolles-Beaven is with the Union Square Hospitality Group. The organization is behind Union Square Café and Gramercy Tavern, rated once again most popular in the Zagat Survey. He says while the group's establishments have not seen a decline in diners, due in part to tourists, they have seen a change in dining habits.
"We have seen people who normally would entertain at night for business, entertaining at lunch instead," said Bolles-Beaven. "We have seen people who would normally spend over $100 for a bottle of wine, spending a little bit less."
Bolles-Beaven expects this downturn to pick up, and says it's important to have a long-term view in this industry. In the meantime, he says small changes make a big difference.
"Union Square Café for example recently added 100 wines to its list that are under $75," he said.
As existing businesses look for ways to stay on top, Zagat knows that even in these tough economic times, new restaurants will continue to open; however, they'll be fewer and more value oriented.