Business

Restaurants being taxed in quarter

American restaurants have no reservations about saying they are hurting.

Darden Restaurants on Friday was the latest to say sales are suffering due to strong economic headwinds at its Olive Garden and Red Lobster eateries.

Darden said its third-quarter profit will be below Wall Street’s expectations and cut its outlook for the year.

The restaurant chain tried new menus and marketing, but revenue at Olive Garden, Red Lobster and LongHorn Steakhouse locations open at least one year is expected to fall 4.5 percent in the quarter ending today.

The Great Recession and its aftermath have been especially hard on restaurant operators, since not eating out is one of the first cost-cutting measures people make when their wallets slim down.

How hard a hit have they taken? In spite of 61 billion restaurant visits made by consumers in 2012, a report from consumer research firm NPD concludes that the pace of business is unlikely to return to pre-recession levels for “years to come.”

In fact, the report states that austerity is the “new normal” for consumers, with 38 percent saying they watch what they spend on those occasions they do eat out.

“The imposed payroll tax increase with its impact on wages, severe weather and rising gasoline prices are all providing added stress,” the report says.

As a result, “nearly three of every four Americans today consider themselves cautious in their spending habits,” NPD says.

On top of this worrisome customer frugality, restaurant owners fret about increased expenses due to the looming specter of an increase in the minimum wage.

The bottom line for restaurateurs is that squeezing more dollars out of customers is more critical now than it has been in years.

“Loyal quick-service restaurant customers visit twice as often,” NPD found.

“Loyal buyers tend to be less price-sensitive and have a higher tolerance for mistakes,” it adds.

For one Brooklyn Chinese restaurant, Green Lake, this paradigm led its owner to expand in tough times.

The eatery opened up a buffet service outlet just down the street from its main location in September, calling it Green Lake Express.

Owner Jia Hao, 40, places a premium on ensuring customer loyalty — which means repeat business.

“People just come in and grab food, but the cleanliness and good service keep customers coming back,” the owner said.