People in the business go quiet when they talk about that period, as if they were looking into an abyss.
Andy Yee stands in front of the new Iya Soup and Sushi Kitchen in South Hadley. The Yee family is among those restaurateurs who have managed to thrive in spite of a crippling recession.
To look back on the recession that began in 2008 is to marvel that restaurants survived at all.
And, yet things are looking up, says Peter Christie, chief executive officer of the Massachusetts Restaurant Association.
Gas prices have come down, and the unemployment rate in Massachusetts is lower than the national average.
“A 6.6 percent unemployment rate is still too high,” said Christie recently. “Too many people are not working. It’s not a full recovery, but it’s headed in the right direction.
“Restaurants depend on two things,” according to Christie. “Discretionary income and consumer confidence. That’s what drives them.”
At the end of the last decade, both were in the gutter. “The latter half of 2009 and the beginning of 2010 were disastrous,” said Christie.
Unemployment and gas prices were high. Corporations stopped taking people out to dinner for sales meetings. Restaurants had more seats than they had customers.
People in the business go quiet when they talk about that period, as if they were looking into an abyss. They remember the restaurants – and not just marginal places, but really good restaurants – that had to close.
Massachusetts takes a 6.25 percent tax on a meal in a restaurant, and in 2009 ,some communities were so desperate for funding that the state passed a law giving them the option of also imposing a municipal tax on meals.
This local meals tax is small (.75 percent, which is less that 1 percent), but it has raised millions for struggling cities and towns.
About 40 percent of municipalities across Massachusetts have adopted the local meals tax, including Amherst, Chicopee, Deerfield, Easthampton, Northampton, Palmer, South Hadley, Springfield, Sunderland, Whately and Worthington.
But it’s the high price of food that makes a real dent in a restaurant’s income, said Christie. Among other things, it inflates menu prices.
“Restaurants have had to go up 3-and-a-half percent,” he said, “and about half of it is just people raising prices because food costs have been extremely high in the past two years.
“Wholesale food costs have gone up double-digit, to almost 11 percent.”
Add to that labor and rent, and even the most prosperous restaurants felt the pinch of the 2008 recession.
Andy Yee, whose highly successful family owns five restaurants in the Pioneer Valley, recalls that period.
“It did impact us,” said Yee. “It caught the world off guard. It had a global effect on discretionary income.”
Yee’s restaurants are among those that survived the economic ups and downs. His father opened the Huke Lau in Chicopee in 1965. Forty-seven years and three restaurants later, the family opened Johnny’s Tavern in Amherst.
Now, Yee is opening the new Iya Sushi and Noodle Kitchen in South Hadley, which he says will be a completely different experience for diners. He said his family is also open to talks with whatever casino is chosen for Western Massachusetts to offer another dining experience.
Yee says his family has been “blessed,” but of course there is more to it than that, and he shared some of his wisdom.
A lot of planning goes into his business. “The economy’s still recovering,” said Yee, “so we give careful, painstaking thought to future expansion.”
He admits that his family is known for working hard. “It’s a product of my parents instilling it into us,” said Yee, one of four siblings.
They also believe in enjoying themselves and in creating an enjoyable experience for their customers.
“Life is fun, and I make sure other people have fun,” said Yee. “I know most of our customers on a first-name basis.
“My father taught me at a very young age to treat people the way you like to be treated,” said Yee, who is visibly moved at any mention of late dad, Johnny Yee.
His parents came to this country in 1951. “My father built a great business, and all the children stayed and worked,” said Andy Yee. Johnny’s Tap Room, Johnny’s Bar and Grill (both in South Hadley) and Johnny’s Tavern are all named after his father.
Andy was 5 when he started peeling onions. Now the third generation, including his own son Matthew, “is coming to fruition, and all are involved with day-to-day operations.”
Yee talked about other components of success. “We’re huge trend followers,” he said. Most of the ideas they use come from the West Coast, he said, joking that it’s something about the water that brings out creativity.
Among the trends he loves is the health boom. “Youth today is very health-oriented,” he said, “very aware of fat, gluten-free foods, cholesterol.”
Huke Lau in Chicopee (there’s another Huke Lau in Longmeadow, which was sold years ago and is no longer connected to the family) has become known for its “create-your-own” stir-fry, where customers choose the fresh, healthy ingredients that go into the wok. “It’s wildly popular,” said Yee.
“Diversity is key in our operations today,” he said. “Our audience expects quality and menu diversification.”
Another key to the family’s success, said Yee, is that they are part of the community. They live only 15 or 20 minutes away from their restaurants. “We love local people,” said Yee. “We are local people. Western Massachusetts is our home.”
Donating to philanthropic causes has further grounded them in their communities.
Another key to success: “Keeping the paint fresh,” said Yee. By that he means keeping a restaurant clean, choosing the proper furniture, changing things as they get out of date.
“If you do not re-invest into your company and ‘keep the paint fresh,’” said Yee, “that is only a recipe for failure. It gets stagnant. The audience today expects a lot more.”
And, finally: “We’ve got great staff in the front of the house and great staff in the back of the house.”
That’s not to say that good restaurants that succumbed to the recession didn’t have owners who worked hard and did the right things. “Some forces were uncontrollable to the operator,” said Yee.
He likes to see others in the industry succeed. He praises places like Atkins Farms – “Kudos to them! They are a fine example of stamina and the test of time” – and his new neighbor in South Hadley, Berkshire Yogurt. “A breath of fresh air,” he said of the eatery and its owner, Kim Wilson.
He’s delighted that one of his former employees has opened Sok’s in South Hadley Falls, and he can’t wait to see what Seven Sisters in Hadley is all about.
The outlook for the restaurant industry in Massachusetts has improved, said Christie. There’s been a net growth of 3 to 3.5 percent in the past year, he said.
“It’s not great,” he said. “It’s not super-duper. But it’s like the economy, slowly chugging along.
“Remember, we had a remarkable summer. The weather was very cooperative. Every vacation place, from the Berkshires to the Cape, was very strong.
“Gasoline prices have come down 25 percent over the past year. And, when gas prices improve, consumer confidence improves.”