Finding the right staff has been a struggle for Dan Kouri, co-owner of Lariat Steakhouse, Kouri’s Grill & Bar and a Sonic restaurant. He said the Lariat is operating with 70% of the staff it needs.
“It’s really what everyone is saying, that the job market is extremely tight in the Peoria market,” said Kouri, who is also president of the Heart of Illinois Hospitality Association.
Shortage of staff has forced some local restaurants to reduce opening hours and days. Sid Ruckriegel, entrepreneur and Peoria City Council member, said cutting hours can work well for businesses looking to maximize service with limited staff.
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But Kouri disagrees with this approach. Every day a business is closed, he said, landlords lose money that could be used to pay rent, taxes and other recurring costs.
“All of this keeps happening and there is no respite,” Kouri said. “So it’s a snowball effect and sooner or later these places won’t survive.”
At Lariat Steakhouse, Kouri recounted a night when a customer was shocked by the price of alcoholic drinks at the restaurant. Although he said the customer was understanding when explaining the rising operating costs, Kouri said many customers were surprised to learn how much inflation was affecting restaurants.
Even the price of Heinz ketchup, Kouri said, is now double what it once was.
This increase, Kouri and Ruckriegel agreed, has a disproportionate impact on “mom and pop” businesses in the Peoria community.
“It was a struggle,” Ruckriegel said. “We’ve seen restaurants close recently, and for operators who maybe don’t have the buying power of some of the larger groups, it becomes a really difficult situation.”
Many of the larger restaurant chains, Kouri said, have a much stronger ability to negotiate the cost of food. Because of costs, Ruckriegel said, smaller establishments are forced to be “more nimble” when trying to balance the cost of supplies against profit.
Non-food expenditures also increased. Ruckriegel said prices for repairs and utilities have risen, and Kouri said businesses are also seeing an increase in the cost of transporting goods.
“So you can see that all the costs are starting to double and multiply,” Kouri said. “And then in the state of Illinois, our governor felt that we needed minimum wage increases over a five-year period. So now it’s increasing our costs on top of inflation. It’s increase after increase after increase.
For Kouri, the city of Peoria also doesn’t make it easy for businesses to operate. He said he sees higher tax rates and costs when it comes to operating in Peoria than in Germantown and Beijing, where his other restaurants are.
Ruckriegel said open dialogue and conversations with the business community are important for the city. Ultimately, he said the city’s goal is to ensure the restaurant industry overcomes current challenges.
With the tax rate, however, Kouri said he felt like “we’re working for the city of Peoria right now.”
“They keep hitting us with more and more fees because they have fewer and fewer people paying,” Kouri said. “So it’s a snowball effect. We are paralyzed. You know, what are you doing? Our roots are here in Peoria. Peoria is a big community, but honestly, it’s getting harder and harder to afford Peoria.
Connect with Cassidy Waigand by emailing her at [email protected] or following her on Twitter at @justxaxwriter.