



Some years ago I confessed to restaurant software salesperson that I harbored a secret desire to one day open a restaurant.

"Don't do it," he said. "Just don't. Please. Everyone wants to own a restaurant, but it's how you go broke. I just watch them go out of business, one after another." He looked truly sad. "If you want to do it, I'll sell the software you need, but seriously: Don't."

It was the weirdest sales pitch I ever heard.

And then I started watching, and I saw what he was seeing.

Not franchises and chains, like McDonalds and Cheesecake Factory -- those typically did well enough. But independent restaurants would appear then vanish like mayflies.

So you have to admire what Fandee's accomplished when they opened up in Sebastopol in the old Farmhouse Restaurant space, in Fiesta mall, half-shared with a credit union.

With little more than gumption, some World Market-style art prints, and family members helping out in the kitchen and dining room, they transformed a tired old diner into one of Sebastopol's most beloved eateries.

Fandee's marketing was confused -- they fought the restaurant's Jordanian name to reassure customers that they were getting "American Food" and "Homestyle Cooking."

In fact, it was none of that. The menu was international and eclectic -- featuring Chicken Schnitzel, Steak Chimichurri, Bucatini Puttanesca, Thai Cod Wrap, Mediterranean Kebba, Lamb Shank, Quinoa-Beet Salad, Vegan Falafel, and Salmon Lyonnaise -- interspersed with more traditional Burgers, Sandwiches, Soups, and Salads, plus familiar entrees like turkey dinner, roast beef, fish & chips, and chicken-fried steak. Fandee's also offered a very traditional breakfast menu: pancakes, waffles, french toast, eggs, bacon, sausage, etc.

But if the marketing was confused, the concept was crystal-clear: Great food and great service at a great price.

It wasn't homestyle cooking. It was much, much better than that. No one I know could keep up with the cooks at Fandee's.

The servers were carefully screened, and only the best were retained. And every server had a clear line of sight to the entire restaurant, so no glass could sit empty unseen.

The owner himself scoured the local produce and meat suppliers to get the best possible ingredients within their value budget. It was a lot of work. He knew which types of produce you could get good quality at Costco, and which types would have to come from more specialized distributors.

He built it, and the people came. First a stream, then a river, and after a few years you couldn't get a table without waiting.

The most fortunate restauranteurs are able to expand when this happens. And with reliable crowds and scale economies, serious profits become a possibility.

But Fandee's didn't have room to expand, and there wasn't a larger nearby relocation option, so we braced for a price increase.

We weren't braced enough, though.

Price

Most of the entrees went up by a dollar or two -- 10-15%.

Soup went from $4.50 to $6.00 -- 30%.

Sides went up. Desserts went up. Drinks went up -- another 10-20%.

And things that used to be included, or could be added on at a discount, now had to be added on at the new price.

The startling compounded effect of price increases plus add-ons meant that:

French toast with bacon and eggs went from $13 to $19 -- a 45% increase*

A grilled cheese sandwich with fries went from $8.50 to $12 -- 40% increase

A bacon cheeseburger with fries with from $15.25 to $18 -- 25% increase

Steak dinner with a cup of soup went from $20.50 to $30 -- 45% increase

Multiply that times the number of people in your party, and it becomes a much more expensive meal.

Audience

Along with the price jump came another kind of up-scale signal:

"French Toast" became "Pumpkin French Toast"

"Pancakes" became "Lemon Ricotta Pancakes"

"Fandee's Homestyle Cooking" became "Fandee's in Wine Country"

And thus ended an era.

Conclusion

Don't get me wrong -- Fandee's has every right to focus its efforts on tourists and wealthy vintners to whom an extra $10 or $20 for a meal is inconsequential, instead of on the majority of Sebastopol residents, who either can't eat out frequently, or do so with something less than abandon.

God knows enough other Sebastopol businesses, including restaurants, find it more profitable to fawn over the wealthy with a posh or trendy offering than the middle class, including Lowell's, K&L Bistro, Gravenstein Grill, and Ramen Gaijin, plus Zazu, and everything else in the Barlow.

If Fandee's wants to compete in the big leagues, their food is certainly good enough, although the ambiance of a converted diner in a mall can't compete as easily.

But I wonder if Fandee's won't regret their choice?

Rich customers may sign the check without looking at it, but they are demanding in other ways. The regulars in a value restaurant are more forgiving when the kitchen is slow, a server is new, or things just go haywire, because they are there as members of a community, and not to be sold a hyped-up experience.

Time will tell whether Fandee's regular customers will simply visit 25% less often, thus raising revenue and thinning crowds while keeping the restaurant at full capacity and maximum profitability.

Or perhaps it will turn out that Fandee's has discovered yet another sweet spot in the market -- sub-premium dining -- just a hair under Gravenstein Grill in terms of quality, price, and ambiance, attracting a whole new set of regulars.

If not, then regular value diners can go back to the way things were a few years ago, and rotate among Martha's, Mary's, El Coronel, Himalaya House, and Thai Pot. Or maybe Riko's will get its act together on quality and service.

And for those who get nostalgic, Cafe Mimosa just opened on Rohnert Park Expressway, with Fandee's old menu, and Fandee's old head chef, and Fandee's old prices. So for now all is not lost -- at least for those who frequent Rohnert Park, and only want breakfast or lunch.

But it will be a sad day in Sebastopol if the gentrification continues, and Mary's Pizza Shack becomes Mary's Wine and Pizza Bistro.

* UPDATE APRIL 15, 2019: I hear that customer complaints about the price of adding on bacon-and-eggs to french toast ($9 surcharge) has resulted in a policy change, so now it's a $5 surcharge, which makes for a more reasonable price hike of 15% instead of 45%.

Fandee's Third Menu

Fandee's Old Menu

Fandee's Original Menu

#Marketing #Capitalism #Sebastopol