Iowa Restaurant Association addresses concerning trend of local restaurant closures

Published: Dec. 16, 2022 at 3:18 PM CST
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CEDAR RAPIDS, Iowa (KCRG) -More restaurants are expected to close their doors in the months ahead. It comes as a number of local restaurants have shut down over the last several weeks.

The closures are happening at seemingly popular restaurants. Fong’s Pizza in Cedar Rapids closed it’s doors last month. Then last week, Saucy Focaccia announced it would close all locations including it’s Breakfast Bar. Most recently Vivian’s Soul Food closed permanently on Wednesday. All of them cited the economy as a reason why.

“It’s sad to see them go like look you know Vivian’s just recently, that place was awesome,” said Joe Sample of Cedar Rapids.

Sample became well known in the area for supporting local restaurants through the pandemic. He still visits them regularly.

”There’s so many businesses out there that I think are struggling right now still,” Sample explained.

The Iowa Restaurant Association says there are around 500 fewer restaurants and bars in Iowa now than there were heading into the pandemic. They believe there are several reasons for the closures we’re seeing now.

”One is cost of goods, second is cost of labor, third is the inflation rate and restaurants have really reached the threshold of what they believe they can charge for people to continue to come in,” said Jessica Dunker, President & CEO of the Iowa Restaurant Association.

That’s something Sample has noticed as well in talking with local businesses.

“The cost of food prices have gone up and a lot of them are afraid to raise their prices because they’re worried customers won’t come in and buy because they raised the prices. So they’re not making the profit they used to make,” said Sample.

On top of that, the Iowa Restaurant Association says pandemic related assistance is running out. Money restaurants may have received from the revitalization fund has to be spent by March. And emergency disaster loans, known as EIDL loans, have to be paid back.

“Restaurants received a 30 month deferment but 30 months has now come and so if they’ve taken on a lot of debt you have to again weigh the numbers,” Dunker explained.

She says buying gift cards, using catering services and ordering profitable items off menus, like fries or alcohol can help.

Meanwhile Sample continues to encourage people to support local.

“We’re going to need it to keep them around. I feel like there’s going to be a lot more that are going to go down. I drive by them everyday and I’m like jeesh. The more you can get out and try to support, make it happen,” said Sample.

The Iowa Restaurant Association says they’re seeing more people share entrees, order water with their meal instead of another beverage, and skip on appetizers or desserts. It comes as customers may be watching what they spend given the current economy. Unfortunately ordering those extras are the only way some restaurants see a profit.