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Porterhouse to Go: Steak houses are making big changes to survive



How difficult is it to manage a steakhouse in the midst of a pandemic? Peter Luger, the Brooklyn institution, offers delivery for the first time in its 133-year history.

Peter Luger is also shipping raw steaks to customers across the country to make up for lost sales, although in his delivery range in Brooklyn and Queens, $ 18 burgers proved more popular than steaks that cost 55 to 65. dollars per person. To make life easier for consumers ordering for delivery, it also accepts credit cards for the first time. Yet all the new evidence is only a temporary solution.

“Indoor dining is clearly the only way to maintain the restaurant business,” said David Berson, general manager of the fourth generation family business.

Business fell 40% at Smith & Wollensky’s nine steakhouses across the country, with urban locations like this one in Boston hitting harder than those in the suburbs.

Mr. Berson declined to provide total sales, but said Peter Luger’s 60-year-old Long Island location, which has been offering indoor dining since July, is selling more than half of its pre-Covid-19 volume. Brooklyn restaurant is about 30%.

The pandemic has hit full-service restaurants such as steakhouses harder than fast-food restaurants and other places for quick meals. Business travelers and tourism have vanished. The steakhouses say the old-time atmosphere preserved in their restaurants is difficult to replicate away from their dining rooms. A medium-rare steak doesn’t travel well in a plastic delivery container. The steakhouses are testing new services, hoping they will be enough to survive the pandemic.

Part of the appeal of steakhouses is how little they have changed since they originated in 19th century New York. Many famous steakhouses have operated non-stop in the United States for decades, with menus of steak, side dishes, and bottled wines designed to evoke comfort and nostalgia.

According to data from consumer research firm NPD Group Inc.; steakhouses are doing better than other full service restaurants on average; visits to steakhouses fell 17% in August from the previous year, compared to 25% for full-service restaurants as a whole, partly because people seek a break in their routine when they get food at the restaurant, he said the NPD analyst

David Portalatin

. “People are looking for a small gift,” he said.

Even so, market research firm Technomic Inc. expects sales in high-end steakhouses to decline by up to 50% this year.

Visits to steakhouses in August were 17% lower than the same month in 2019, according to NPD Group.

Some upscale steakhouses sell takeaway wine, at a discount, but that won’t make up for the double-digit sales losses, he said.

Norman Abdallah

, former CEO of steakhouse owner Del Frisco’s Restaurant Group Inc. Some of the highest volume outlets in the chain of 30 restaurants in the city including Boston and Washington, DC, including Double Eagle Steakhouse in Midtown Manhattan, have been closed to dine service for long periods of pandemic.

Smith & Wollensky Restaurant Group Inc., with nine city locations ranging from New York to Taipei, plans to market its small-meeting dining spaces to corporate clients, said president Oliver Munday. Restaurants tend to have large square footage that lends itself to the physical distance between guests, he said. The chain, whose sales in the United States fell 40%, is also creating new dishes with cheaper proteins like seafood.

Smith & Wollensky’s suburban locations fared better than urban ones, he says, because they cater more to local families and customers rather than corporate customers. With many employees still working from home, steakhouses in malls sell fewer expense accounts that have long been a mainstay. But suburban localities also suffer. Revenues have fallen as rent and prime beef remain expensive, not to mention new costs such as investments to set up outdoor dining spaces.

“In the current context, there is no such thing as stability,” Munday said.

President Smith & Wollensky Oliver Munday at the chain’s headquarters in Boston.

Some chains, including Ruth’s Hospitality Inc. and

Texas Roadhouse Inc.,

began selling takeaway steaks, in some cases raw, which created new costs such as packaging and commissions to third-party delivery companies. Restaurants sell their raw cuts at prices comparable to high-end butchers, which are more expensive than supermarkets. Chris of Ruth said this summer that six of its 159 locations had been closed and canceled two leases for the planned restaurants.

Lawry’s Restaurants Inc., owner of seven high-end steakhouses in the United States, began offering raw steaks and weekly meal kits after takeaway alone proved unprofitable. It began selling whiskey on flights to go, allowing customers to chat online with a beverage manager before ordering. He also added online wine and cheese parties with sommeliers.

However, the company is closing its 46-year-old Chicago location at the end of the year, although it hopes to reopen another steakhouse in town if rents fall, said Ryan O’Melveny Wilson, CEO of Lawry and great-grandson of its founder, Lawrence Frank.

Kevin Joseph said he will not reopen Joseph’s Fireside Steakhouse in Waterville, Maine after it closed in March due to local ordinances. Although he and his business partner could have reopened in June, they concluded that costs would remain the same while annual sales, which exceed $ 2 million pre-pandemic, would drop for the restaurant by nine years.

“We wanted him to stay,” said Mr. Joseph, 63, who added that he will be retiring.

Some steakhouses sell raw cuts of meat to customers who want to cook at home. The prices are comparable to those of high-end butchers.

According to BankruptcyData.com, more than half a dozen steakhouse operators have filed for bankruptcy following the pandemic, including Logan’s Roadhouse, Sizzler USA and Charlie Brown’s Steakhouse chains.

Since many steakhouses operate limited hours or remain closed, some customers choose to cook their own steaks. Todd Allen, director of meat and seafood at Raley’s, a grocer with nearly 130 stores in California and Nevada, said steaks and other restaurant substitute cuts are driving sales growth in the chain’s meat section.

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Andrew Zimmern, executive producer and star of three food TV shows, including Travel Channel’s “Bizarre Foods with Andrew Zimmern,” said the online videos he had previously produced on cooking steak and lobster had a major impact on traffic. . “I’ve answered more questions about how to grill an expensive piece of meat in the past month than in the past 10 years combined,” he said.

Jamie Greene, a 42-year-old publisher living outside Washington, D.C., said he started making steaks over the summer and finds it an easy indulgence. “I’ll probably continue like this,” he said, adding that he has no plans to go to steakhouses even when the pandemic subsides.

A Smith & Wollensky worker prepares raw steaks for home delivery.

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