ST. PETERSBURG — Venita Gilstrap saw it coming. For months, her restaurant, Gillie's Barbecue in the Grand Central District, had been losing customers.
"It started with the gas crunch, and people didn't have money," she said. Food suppliers charged more. Then the housing market dropped, and finally the stock market crashed. Last year, just before Thanksgiving, Gilstrap and her husband closed shop.
In recent months, a host of restaurants in St. Petersburg have closed, unable to attract enough customers to keep the doors open. Empty storefronts along Central Avenue and First Avenue N are visible evidence of the beating eateries have taken in the midst of a recession. Within the year, at least 15 eateries and small businesses have tanked, affecting large chains and smaller mom and pop shops.
In response to the growing problem, the city is launching an aggressive effort to help small-business owners with 25 or fewer employees stay afloat during what experts call a worsening recession.
Last week, the city held a small-business summit designed to educate small-business owners about resources available to them.
"The heart of our economy is based on small business," said City Council member Leslie Curran, who herself owns a business. "I want people to know there are resources out there if they need help. Most don't know," she said.
The event drew about 200 people Wednesday night, including Gilstrap and her husband, who own another business, Scottie Bail Bonds. She said she showed up for tips on how to keep things going in tight times. Owners met with the city's business assistance center, permitting services and the Police Department to discuss security, codes and other ways to collaborate.
"Many times you find the small businesses don't have the funds to get certain tasks accomplished," said Gilstrap, 53. She said she was encouraged by services offered by local colleges and universities, including business strategic plans and interns.
Wayne Brass, of the Small Business Development Center at the University of South Florida St. Petersburg, said prospective business owners should have a good plan. The center offers confidential counseling to fledgling businesses, including strategic plans that could help business owners qualify for competitive loans, which are scarce due to the financial crisis.
"You have to know your industry, you have to know the market. You don't see McDonald's and Burger Kings closing," he said. The reason: "They understand the importance of location and knowing who their customers are," Brass said.
Last year, Florida's leisure and hospitality industry shed 37,600 jobs, and other services lost 13,100 jobs.
Rebecca Rust, chief economist for the Florida Agency for Workforce Innovation, which calculates unemployment trends, said restaurants and other eateries are feeling the pinch as fewer Floridians dine out.
"People are spending less," Rust said. "They're either unemployed or concerned about their jobs … and holding back on their spending."
Paul Stellrecht, economic development coordinator for the city of St. Petersburg, said although business is bad, now is the time for companies to come up with new strategies. "Now is the prime opportunity to go back and get that extra training, those extra skills to make you more competitive," he said.
Asha Patel, who owns Firehouse Subs on Fourth Street and is opening a new shop in Clearwater, knows that all too well. "People are coming, but they're buying much less," she said.
Before the economic downturn, customers would come in for a combo meal, but now they might only buy the sandwich, skipping chips and a drink.
Now that construction workers aren't coming in, she has had to cut prices and is offering coupons to draw people in. Patel, 45, has taken advantage of the resources through the city's business assistance center and remains optimistic.
She's mentoring her assistant manager to one day open his own business. "It's his dream ," she said. "I told him it can happen, but you have to know what your doing."
John T. Long, president of the St. Petersburg Area Chamber of Commerce, said that a handful of restaurants have recently canceled their memberships. Long said the chamber is trying to work with members on retention, but some have simply gone underwater.
He said the shift in climate has led to creative tactics in the tough times. "More people are serving comfort food on the menu. Meatloaf, macaroni and cheese, beef stew are coming up in more restaurants," he said.
Nick Vojnovic, president of Beef 'O' Brady's based in Tampa, recently saw a restaurant close off Fourth Street N. "Where the housing market has really crashed, those areas are having a tough time," he said. Consumer models have led him to take several measures, including recommending a full-liquor program at qualifying restaurants, more dinner entrees and offering breakfast in some markets.
He sees opportunity if the diners can stay open as others falter. "I tell my restaurants that we have a tough 12 months ahead. Keep your belts tight, keep customers coming in, but when this thing turns around, people don't buy cars, they come back out to eat."
Jeff Harrington contributed to this report. Austin Bogues can be reached at [email protected] or (727)893-8872.