It happened because of poor management choices. Restaurants close in both good and bad economies.
16 Likes
Bad management, new owners who did not understand the American diner, poor demand forecasting. This will be a business school case in a year and you are rightā¦ nothing to do with the economy!
11 Likes
Sounds like it happened because a supplier bought the business and they are premium priced and installed their product in place of the prior offerings.
Additionally, it sounds like some staffing changes reduced productivity - which likely reduced throughput and hence revenue.
1 Like
This is actually a case of when asset stripping goes bad. PE firm came in and tried to create a quick windfall by selling the real estate that the restaurants sit on.
The presumption was the individual outlets would be able to afford to continue operating profitably in spite of now having to pay rent and the PE firm would take a quick financial win on the asset sale.
Worked out for the PE firm as they exited but ultimately the incremental costs set off a death spiral.
Little to do with the economy or consumer although āendless shrimpā was a costly but survivable blunder had management not committed the ultimate mistake of layering on costs and assuming they could just be absorbed by operations.
As @blossom accurately points out, poor ācentralizedā operational management at the expense of regional expertise seems to have struck the last blowā¦
7 Likes
I would say it is about 8 or 9 and it is not just my personal situation. I walk down NYC, itās packed every where. People are standing outside of stores waiting to get in. People are traveling. This weekend was a record day for number of people traveling. If the economy is so bad, I donāt think people would have disposal income to spend on extras.
Last month when I was in Europe the exchange rate was 1.07 vs 1.0. I thought everything was cheap.
8 Likes
The right people to ask this question to is not the parent CC cafe crowd but maybe our children - or maybe more accurately, non-CC young adults. Those in their 20s, 30s, 40s who are still in the thick of starting adulthood, securing jobs and climbing that ladder, establishing homes/families/lifestyles -and what realistically can that lifestyle be.
Hereās one barometer that indicates to me that young singles/families are struggling.
Facebook.
Neighborhood groups, FB marketplace. Buying, selling, ISO (in search of). People asking for basic need items for free/little cost. From food to furniture to odd jobs to make ends meet. Marketplace prices that to me seem laughable but also sad - people trying to sell used patio furniture that is clearly used for 50%+ of original price. Same for clothing. Household items. No garage sale prices here, they want/need top dollar. `I often canāt believe the prices I see people trying to get. It indicates to me not someone wanting to get rid of stuff at home but people NEEDING to get good cash for something they can part with at home. Itās eye opening.
4 Likes
I asked my 23 year old this question this weekend as it was a topic of conversation over dinner - she said sheād rate the economy an 8 or 9.
We also saw the same thing this weekend as Oldfort - bars and restaurants packed, long lines at clothing stores, and tons of people traveling.
Our FB groups are full of free stuff people are trying to give away. Maybe regional differences?
1 Like
My two 30 somethings are different.
1.the higher earner says the economy is 6-8.
- The lower earner says itās improved, and he can easily support himself in a challenging career to do so. So he thinks itās OK too.
We grown ups donāt know what to say. It fluctuates so much.
1 Like
I would give 6. Especially if factoring cost of living and taxes.
Is this something that is just more visible now because it is easier to do than ever before? In my area people are constantly posting in search of free items. Around here, asking very often results in getting the requested item. There are so many items offered free on Facebook that it is no exaggeration to say that one could furnish a home for zero cost if they wanted to.
Yes, there are struggling people for whom these give away groups are a lifeline, but my main thought is that buy nothing pages and the like make it a bit easier to find needed items. Anyone with a phone has access to these groups.
2 Likes
This is the federal reserve report referenced in that tweet. There are differences that track more closely with a less than rosy view of the economy when the results are broken down by attained education level, race and families with kids at home for example. CC posters seem relatively happy with the economy which tracks with the overall feelings of those with a college education and no kids under 18 at home. Iād also add that in each chart a majority of the percentages are on a downward trend from a high in 2121 which was when people were flush with cash from the government stimulus and being forced into saving by the pandemic.
I know there are some pain points in the US economy currently, but I really think it is overall pretty good, even for many young, low-income, low-education workers.
I have 5 nieces and nephews between 22 & 25. Two have college degrees; one works as a preschool teacher and the other as a special education aide in a public school. The other 3 donāt have even high school degrees. 
They work as a retail store manager, a waitress, and ā¦a variety of retail/service type jobs while trying to break into acting.
I would guess that all five of these people would be struggling financially given these jobs. However, they are all very happy! They all do lots of traveling, going to concerts, eating out at restaurants & drinking, buying new clothes. I canāt imagine that on those incomes they are saving anything, and none of them have kids, but they also all have a lot of places they are spending money that they could cut if they wanted to either save or live a different type of life. (Old woman, kids these days rantā¦ When I was 24, half of my income went to pay my necessary living expenses, and the other half went to paying down my college debt.)
I know a handful of other young people without college degrees who are working jobs like landscaping or retail and living very similar lifestyles.
I think (except for the issues with housing caused by too little supply driving up costs) the economy is actually pretty good, but the expectations most of us have of what we should be able to buy with our income have really inflated over the past 20 years.
1 Like
May I ask if your nieces and nephews are living at home with their parents? I think a lot of young adults are living at home and may have more disposable income.
1 Like
The three without high school educations are not living with their parents, although they all have roommates. The two with college degrees working as teachers are living with their parents. (These 2 both have career plans that will require grad degrees. My guess is living at home allows them to do a lot of the entertainment things I see while still putting aside some for grad school. Iām pretty sure the other kids are saving nothing.)
And they live in a variety of cost-of-living areas: NYC, upstate NY, and a couple of southern states.
Re: the free stuff.
I see two things fueling this- which have nothing to do with the economy. The first is that many of us/our kids no longer settle close to extended family. āBack in the dayā you furnished your apartments, first house, etc. with the family cast-offs. Aunt Mabelās couch, grandmaās end tables, Uncle Tomās old desk. Someone in the family had a big, dry attic or big, dry basement with a walkout door to make it easy to store stuff, and that became the family repository. It was mostly a revolving door- the new homeowners came in and grabbed what they needed so they didnāt need to pay for furniture, dishes, potsā¦ and when an elderly family member died or moved in with their kids, their stuff went to the āfamily storeā. When we sold the home I grew up in, we had to dispose of a garage, basement, and attic filled with the stuff accumulated from elderly and deceased relatives (my parents ran the repository for years) which grandkids, nephews, in-laws, etc. no longer could take because who is paying to ship an old couch 3,000 miles? So distance is factor number one- young people post what they need, older people post what they are getting rid of-- weāve just eliminated the middle man (i.e. like my parents).
Factor number two-- the young peopleās environmental concerns. I donāt remember ever worrying about what happened to my gas grill, supply of old paint, cleaning chemicals, etc. when I sold a house and moved cross-country. I wasnāt going to pay a mover to deal with itā¦ so I left it. I assume that our realtor or the new owners trashed it all but I never thought about it (my bad). Now my town has designated days for removing toxic household products so that people donāt pour it down the drain (we live near water and wetlands), or put it in the trash for landfill. And therefore LOTS of posts on our local Buy Nothing groups-- āwho has an extra canister of propane they canāt get rid of?ā, āwho has half a can of pink paint for a powder room, any shade?ā, āJust moved to a new apartment and will take anything you are getting rid of- bleach, ammonia, anything that removes dog smells from carpetā.
I donāt see a connection to the economy in either of these two factors. Young people just starting out NEVER were able to fully furnish their living space with new stuff- I certainly didnāt. But we had family hand me downs!
7 Likes
I really never know how to answer this question. My personal economy is fine, though we live somewhat frugally, relative to many of our friends and neighbors. It certainly looks like everyone around us is doing fine, too. But I recognize that we, and those that surround us, are planted in the āhaveā camp in a society with an ever-widening gulf between the haves and have-nots. So in that sense, overall, maybe Iād say the US economy is at a 5 of 6? For context, I would say it was at a 0 or 1 during the depression and probably a 9 during the boom of the 90ās.
I guess for us it would be an 8 or 9. Economy seems to be doing pretty well, as long as you have money invested. Prices (especially dining out and hotels) seem high, but it seems lots of prices went up with covid and just creep up since.
I agree that there is a (positive) movement to reuse, re-gift, up-cycle things and give new/more life. And that many things CAN be snatched for free just by asking.
But the prices of used items being posted for sale are so often INSANE! A patio table and 4 chairs with rust and maybe a broken piece or two for 50-60% of retail new price? I see it daily. People taking the time to post random $3 items and arrange pick up $3? Furniture prices at garage sales higher than the local nice consignment shop?
You can try and justify it anyway you like. At least in this blue collar town, there are many families hurting.
Or living their life with NO savings - paycheck to paycheck.
I think if we donāt recognize that, we are doing our communities a disservice. Windows and mirrors people.
If you want to know why young people are traveling, and others are out and about, look no further than the article below.
1 Like
I go on the marketplace a bit, and I think the issues are different. People going through the trouble to sell things for a couple bucks does seem sad, like they really need the money to go through such trouble. But high prices for overpriced junk, I would attribute to inflation, people thinking they can get high prices for that stuff, whether they need the money or not. If I really needed the money, I would clean something up and hope to get a higher price. I always clean up what I post on OfferUp, otherwise I figure Iād have no chance of selling it.