From Canyon to Cove: How to make it in the ‘new economy’

As the recovery stalls, cracks are beginning to show in the local economy, particularly in the vulnerable restaurant industry.

The news last week that one of the country’s largest restaurant companies — which owns Las Brisas, where the old Victor Hugo’s stood for years — filed for Chapter 11 bankruptcy protection has rocked but not shocked those in the know.

Real Mex Restaurants also owns the El Torito, Chevys and Acapulco chains, all of which are practically ubiquitous in Southern California.

At least Real Mex employees can be assured the restaurants, including Las Brisas, will continue to operate under the financial restructuring company officials are seeking.

Not so for some other city eateries, two of which — Kentucky Fried Chicken and Mosun, a nightclub and sushi place — abruptly pulled up stakes recently. That was after the closure earlier this year of Sorrento Grille and A La Carte, both of which have been replaced by new dining establishments.

What does it take to keep the doors open in the volatile restaurant market?

I sat down recently with Melinda Morgan Kartsonis, a Laguna Beach resident who is intimately involved in many restaurant enterprises as a dining marketing specialist.

Like many in business these days, Kartsonis is seeing “caution signs” everywhere. Spending is down, hiring is down, and people are just hanging on to their money.

“Many clients have smaller budgets than in previous years,” she said.

Many are turning to social media — particularly Facebook and Twitter — as a cost-effective way to spread the word among “foodies” about what they have to offer and create a buzz.

With Twitter, for example, a restaurant can tout the appearance of a celebrity or a great food deal and voilà! People will show up at the door. It actually happens, according to Kartsonis.

“Social media is a growing area where my firm is achieving quantifiable results and this area shows strong and steady future growth,” she said.

One of Kartsonis’ clients, Sapphire Laguna’s Azmin Ghahreman, is looking at the bottom line without rosy glasses on and hanging on to customers by lowering the price point for fine dining.

“The economy definitely affects the restaurant industry as people will dine less frequently and when they do dine, they often share appetizers, split desserts and even bring in their own wine,” Ghahreman said.

“That being said, the restaurant tab is smaller, which affects tips, which affects the servers and bartenders. It’s the basic ‘trickle down’ theory. What Sapphire Laguna has done is increase our Spice Plates selections, which give great value.”

Ghahreman’s Sapphire Pantry is now serving a breakfast taco for less than $5 (that is a great deal) as well as targeting the locals market with “burgers and fries to go.” And these are not your average takeout place burgers and fries, these are Sapphire burgers and fries.

Is Sapphire giving the takeout places a run for their money? Can we Tweet that?

CINDY FRAZIER is city editor of the Coastline Pilot. She can be contacted at (949) 302-1469 or [email protected].