About a year and a half ago (January, 2007), King Banaian, Hari, and I went on a pizza crawl while attending the ASSA meetings in Chicago (see here for my wrap-up review and links to the individual reviews). Pizza Uno received my highest rating during that expedition, but now the WSJ is reporting (h/t to MA) that Pizza Uno will miss making a payment to its bondholders today.
The parent of Uno Chicago Grill, a chain of 200-plus pizzeria-themed restaurants, will skip a bond payment on Friday as it tries to negotiate more financial breathing room amid increasingly difficult times for sit-down eateries, according to two people familiar with the matter.
Uno Restaurant Holdings Corp. ... is one of a growing number of regional and national restaurant companies squeezed by falling sales, rising food costs and burdensome debt.
Uno Pizza is not the only mid-range restaurant suffering. From the same article,
Other chains, such as Chevys Fresh Mex and the home-style Perkins and Marie Callender's chains are also in talks with their lenders, say several people familiar with the companies. ... All have had earnings slow as diners cut back on eating outside their homes. ...
During the first half of 2008, same-store sales at midpriced sit-down restaurants declined an average of 1.1%, according to Knapp-Track, which measures sales at 10,000 restaurant outlets.
In the last few months, sit-down chains such as Bennigan's, Steak and Ale, and Vicorp Restaurants Inc.'s Bakers Square and Village Inn chains have filed for liquidation or bankruptcy protection, frequently moving to shutter hundreds of sites and cut thousands of jobs.
I don't know that incomes have actually fallen .... yet.... for the appropriate demographic who tend to eat in mid-range restaurants. But this information suggests that households that might tend to vary the amount they eat in such restaurants expect (with some probability) their household incomes will decline in the future. This expectation leads to a decline in their "permanent incomes" (which are closely related to wealth and expected incomes), and it is this measure of income which seems to have a major role in affecting discretionary consumer spending, including sit-down mid-priced restaurant dining.
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