The price of success

We all know that restaurants are hurting across the board right now, what with all the tightening of wallets, closing of corporate expense accounts and losing of jobs, but higher-end places, naturally, are suffering more than most, and many are starting to employ some interesting survival tactics. Take for example, high-end steak house chain Ruth’s Chris, the closest outpost of which resides in Tyson’s Corner. The restaurant’s publicly traded parent company has had much organizational turmoil, including large layoffs, and ended 2008 with $58 million in net losses. As part of a plan to get out of the woods and attract more diners, Ruth’s, best known for feeding groups of formerly flush-with-cash investment bankers across America for $2,000 tabs, has added steep discounts to the menu at many locations, including a steak-and-fries dinner for $19.95 and a three-course meal of “Ruth’s Chris classics” for $39.95. And the trend is hitting home as well. One of our own high-end peddlers of steak—The Upstairs, which sells only the best grade of USDA-rated steak called Prime—currently is running a major deal. Now through Mother’s Day, the restaurant is offering Prime rib-eye and Prime New York Strip steaks for a shockingly cheap $18 (sides are an additional $3). On the regular menu, a 12-ounce Prime rib-eye fetches $35, and a 10-ounce Prime New York strip, $37.

“We’re making it as cheap as humanly possible to entice some more people to come out,” says Upstairs owner Mark Brown. During this same time period, The Upstairs is also offering a $25 tasting menu of three or four courses on Tuesday nights.

Brown says this current economic recession has been an interesting learning experience for him. Before the financial world got all messed up and crazy, Brown says success in retail hinged on quality and controlling costs, but now, he says, “it’s all about price.” Take for another example, a discount The Upstairs offered this past Valentine’s Day, when a nice crowd of 65 was in attendance. “We wanted to get rid of some Dom Perignon, so we offered it for $150 a bottle that night,” says Brown. “We didn’t sell a single one. Two years ago, I would have sold all of it. I guess people are thinking it doesn’t matter that I can’t buy this cheaper anywhere else, I just don’t want to spend $150 on a bottle.”

Brown says he and chef and general manager Jaison Burke are looking forward to The Upstairs opening its patio space for the first time this spring, and though rumors have circulated that The Upstairs is for sale and that Burke himself may buy it, Brown says that for now, it’s business as usual. “Everything I own is perpetually for sale,” says Brown, whose real estate holdings include the Downtown Mall building that houses The Upstairs and Escafé as well as a few other properties, “but it’s not being actively advertised.”

Openings

One opening and two pending openings to report: Shenandoah Joe has opened an espresso bar in the old Java Java space on Ivy Road (the Downtown Java Java remains in operation under new ownership). Hong Kong Restaurant and Take-Out in the Southside Shopping Center is opening May 1, and Tres Amigos at 946 Grady Ave. (in the old Mamma Mia and short-lived El Dorado space) is “coming soon.”