Beloved Mexican restaurant closing despite Guy Fieri, fan support
Customers rallied and showed their support when this chain shared plans to shut its doors. That wasn't enough.
Even a visit from Guy Fieri and an incredibly loyal customer base can't protect some restaurants from the realities of the food business.
When you don't own the building your business operates in, you lack a clear level of control. Most restaurants sign longer leases. In many cases, five years, with an option for a second five years at a negotiated price increase.
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In those circumstances, a restaurant has some level of cost certainty. Rent is often the largest expense (although labor costs can sometimes be), and having it locked down for a decade make it easier to make decisions.
When leases end, however, many restaurants find their landlords wanting increases that make their business model no longer viable. Most eateries can raise prices 5-10% every few years, but any more than that and they scare their customers away.
