Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, January 19, 1992 TAG: 9201170043
SECTION: BUSINESS PAGE: C-1 EDITION: METRO
SOURCE: MAG POFF BUSINESS WRITER
DATELINE: LENGTH: Long
IN SEARCH OF DINERS
A mere half-block east of Roanoke's crowded City Market, Jimmy Butler labors to lure people to his Groucho's restaurant.Historic-district rules barred him from tacking a sign to the Market Building with an arrow pointing to Groucho's around the corner on Williamson Road.
So he tries promotions like free lunch to the first customer who guesses the secret word and a discounted dinner packaged with an evening visit to the upstairs Roanoke Comedy Club.
Butler said his problem in attracting pedestrians is a dearth of shops and restaurants behind the market. "You turn the corner, and there are parking lots and me."
Groucho's, he said, is "the perfect example of out-of-sight, out-of-mind. . . . Getting people to know that we're here is difficult."
Only a decade ago, all of downtown was deserted at night. Now Center in the Square and a cluster of restaurants act as a magnet drawing people to the area around Market Square.
But their after-dark magic has yet to sprinkle even a few blocks to such places as the Galeria Internacional, Secret Garden or even the refurbished Patrick Henry Hotel.
Restaurants located even half a block away from the square have found it's difficult to drawn attention and diners. Some have compensated by limiting themselves to lunch traffic. Others have honed reputations as destination restaurants, with an established clientele.
Mr. Su's, two blocks west of the Market on Kirk Avenue, is filled at lunch time with workers from nearby office buildings. But at night, owner Nam Su faces an empty street.
"It's not too well," Su said of his attempt to build an evening clientele. "It's very slow traffic."
The City Market is busy even on week nights, Su said, but just a short walk away downtown "doesn't have a lot of activity at nighttime. It's so quiet."
Su said he tried newspaper advertising, but it didn't help much. While the weekday lunch crowd supports the restaurant, he hopes that word-of-mouth will build his nighttime business.
Of the successful exceptions, two popular destination restaurants - Alexander's and Corned Beef & Co. - were born on the City Market. Only Macado's, taking aim at a niche, hatched outside the market.
A cluster of restaurants in itself becomes a point of destination, said Michael Olsen, professor and head of the department of hotel, restaurant and institutional management at Virginia Tech.
Restaurants on Roanoke's City Market, he said, "are bound to pick up extra traffic."
But just a short distance away, Olsen said, "the rules of competition change" from a mass market setting to an individual situation.
Advertising helps only if an isolated restaurant has something special to sell, Olsen said. "They've got to differentiate themselves on product or service attributes, something different to entice people in the door that is consistent over time."
Differentiation, quality and price are the most important factors, Olsen said.
The central business district has 59 restaurants, according to Franklin Kimbrough, executive director of Downtown Roanoke Inc.
Most, however, serve lunch and perhaps breakfast, closing in mid-afternoon. Kimbrough said 11 restaurants in the City Market Building food court serve early dinner but close at 6 p.m.
Only 26 downtown restaurants consistently offer dinner at least two nights a week, Kimbrough said. Four also provide some sort of live entertainment on a regular basis.
Downtown, especially the market, is a destination at lunch time and, to a lesser extent, in the evening, according to Kimbrough. Parking-lot operators tell him that groups of people drive downtown for lunch and dinner knowing the district gives them so much choice of restaurants.
"Evening is not bread and butter for most restaurants downtown," Kimbrough said. "But it's a difference between profit or just paying the bills."
Conventional wisdom holds that location is everything, Kimbrough said, but he thinks that lapses in capitalization and management cause most failures. Even some restaurants "right smack in the middle of the market" have failed in recent months, he said.
One of them was New Market Grill, which closed in September after nine months. It was in the former Corned Beef & Co. quarters in the Market Building, right on the square.
Ed Murphy, the owner, said he faced "an extreme amount of competition" when he opened just as the economy turned down.
His partners quit the business, loading more responsibility on Murphy. If he had stayed and worked hard, he said, New Market Grill might have made it. But "I felt my better move was to go to catering."
Corned Beef & Co. "took a good number of their customers" when they moved to larger quarters a block away on Jefferson Street, Murphy said. "They have a steady following."
Al Pollard, who owns Corned Beef & Co. with Roger Neel, attributed "a lot of our success to starting on the market. The corner location was really good to us."
They moved for larger quarters and an opportunity to own the restaurant location. "I was scared not knowing what would happen" after the move.
What happened was that customers followed them. "We have a lot of repeat customers."
Pollard said Corned Beef & Co. also gained new clientele by offering a varied menu, reasonable prices, entertainment and late night hours. The eatery is open until 11 p.m. week nights and to 2 a.m. weekends. "It's very important to serve food at any hour."
Another market-born success is Bridget Meagher's Alexander's restaurant. She moved to the building next to Corned Beef's new location, dropped lunch except for Wednesdays and expanded dinner service to five nights a week.
Lunch business is "demanding and unprofitable," Meagher had found. She needed a full staff to operate for just one hour's worth of hurried eating. Even though the dining room was filled, she said, the average luncheon tab of $4.50 to $5 "just didn't do it."
Closing during the day also allowed her to expand her catering business, which increased last year while restaurant revenues remained flat, she said.
At the restaurant last year, week-night patronage increased while weekends turned slower. Meagher said she's happy with that result considering the changes in the restaurant's hours and the recession.
"When I opened on the market [in 1979], I was told I was crazy," Meagher said. "We were busy from the day we opened." Now, she said, diners "tend to point their course toward the market," which is what she had hoped would happen.
As the market thrived, she was told it was a mistake to move, but "people found us." She agreed with Kimbrough's assessment that Alexander's has become a destination restaurant, where people will head regardless of its location.
That's not true at the market, according to Jeff Winslow who has operated both on an off Market Street.
Winslow is in the process of selling his City Market enterprise, 309 First Street, and he recently sold Salad Works in the Market Building.
He will sell 309 First Street as soon as the liquor license is transferred to Robert Callahan, who operates food concessions at Fairystone and Douthat state parks.
Winslow said the transfer is not a distress sale because 309 First Street is doing well. "It was time. I'm a victim of burnout," Winslow said. "I want to try some new options." He said nothing else will change at 309 First Street, which he opened in November 1983.
"People naturally gravitate down here. They come to the market to eat," Winslow said. The market itself is the destination, especially on warmer nights or when Mill Mountain Playhouse has a show.
They select the restaurant when they arrive, Winslow said, so the doorstep sign listings his nightly specials is his most important drawing card.
People drive to the market in groups of four or six, Winslow said. They park the car and then decide what to do.
Very often, he said, they have cocktails at one place, move to a second restaurant for dinner and wind up at Mill Mountain Coffee & Tea for dessert. "People eat all over the valley and end up there," he said of the 18-month-old coffeehouse facing Campbell Avenue.
The recession has hurt all restaurants, Winslow said, and January is always the slowest time of the year. But he said restaurants at the market have been hurt "far less" than eateries elsewhere in the valley.
Before renovation of the Patrick Henry Hotel, Winslow tried to transfer his experience to the hotel dining room. But Winslows' closed there after just a year.
In part, Winslow said, he was undercapitalized for the hotel venture. But more important, he was unable to convince people to drive specifically to the hotel for dinner.
"I thought I could get people to change their eating habits," Winslow said. "I just thought people would make a move - and they didn't."
Affirmative Equities, owner of the hotel, hasn't given up, however, despite the failure of both Winslows' and its successor, British Tradition, operated by a group of local investors.
Hotel spokesman Michael Murphy said Affirmative Equities will run the restaurant itself under the name Traditions. It has hired the former maitre d' from The Library, a Franklin Road restaurant, and a former Hotel Roanoke chef.
Winslow, he said, was "overwhelmed" trying to operate at two locations, while British Traditions "never seemed to market in a way to attract enough people."
Murphy said the renovated hotel has good occupancy and its guests should supply 15 to 20 percent of the dinner business. For the rest, he said, the hotel will feature "dining events" and begin an advertising program to attract people from the valley.
One block up Jefferson Street from the hotel, Isis Ashworth said Galeria Internacional is supported almost entirely by lunch. "Nighttime in the downtown area is very bad," Ashworth said, because stores and offices are closed.
She said downtown businesses must take some action to increase foot traffic on other streets. "The market is where the action is," she said.
On Campbell Avenue, Sun Hee Muskopf has given up trying to attract walkers from the market to her Secret Garden restaurant in the evening.
Daytime business at Secret Garden's is good, she said, but, like Alexander's, she found the single-hour's rush too demanding for menu service. Her solution was to switch to a buffet.
But she is no longer open every night with a varied menu. Muskopf said she now opens only Friday and Saturday evenings, by reservation only, for a menu of authentic Korean food.
Rather than compete with the market, Muskopf said, she is trying to develop the Secret Garden's niche as the valley's only Korean restaurant.
A niche is how Roland "Spanky" Macher promoted Macado's four blocks from the market on Church Avenue.
"We're definitely a destination restaurant. People know they're coming here," he said.
Those customers fall into two categories, he said.
One is the adult crowd that has gathered at the bar each evening for the past 13 years since Macado's opened.
But the main clientele consists of 16- to 21-year-olds who want a good time - and don't want trouble. "We're a safe place to go, a safe place to bring a date," Macher said.
Macher said Macado's specializes in an interesting atmosphere, music, affordable food, desserts that can be the focal point of a young couple's evening and plenty of non-alcoholic drinks.
Besides, he said, Church Avenue is well-lit and wide. Macado's is easy to find.
Kimbrough of Downtown Roanoke said that "success breeds success."
He estimated that, since October, 50 percent of his prospects for new downtown businesses have been restaurants.
He said the prospects include both area restaurants interested in a downtown branch and regional enterprises looking to move or expand. And they are searching on and off the market.
Macher, at least, doesn't worry about any more competition.
"The more restaurants that open downtown, the more it increases our business," Macher said.
Memo: CORRECTION