Closures on Franklin Street due to seasonal business cycle

The start of a new semester usually means that Franklin Street is bustling with activity: businesses with doors wide open, students roaming the street looking for a good deal and plenty of people walking their dogs.

This semester, however, has been a little different. In the past few months, several notable businesses on Franklin Street have closed their doors or announced relocations. McAlister’s Deli, previously located on East Franklin Street, closed Nov. 20. Other prominent Franklin Street restaurants that have closed recently include Jasmin Mediterranean Bistro and Khushi Salads and Wraps.

The business turnover encompasses more than just restaurants. The Bookshop announced on Jan. 5 that it will close in July.

“The building was up for sale and our lease is up in August,” The Bookshop manager Betty Schumacher said. “It’s not that we’re losing money. It’s that we haven’t grown enough.”

Schumacher said business for The Bookshop, which has been operating on Franklin for over thirty years, goes up and down depending on the season.

“Our best months were always July and August, when townspeople came back to town,” she said. “We get a lot of students during the year, but most of our revenue comes from townspeople first, then professors.”

Ted Zoller is the director of the Center of Entrepreneurial Studies at Kenan-Flagler Business School. He agreed seasonal business is one reason behind the business turnover.

“You’d be shocked at how many businesses operate in the fourth quarter,” he said. “They get all their money right before the holidays. They lose money after because there’s not a lot of profitability.”

Zoller also said high rent and student mindsets toward spending contribute to the business turnover.

“The real issue for the retail restaurant business is the rents, which remain high,” he said. “The problems are also that businesses are highly seasonal and that students operate on the margin so they don’t want to spend a lot of money.”

In the midst of this business turnover, some restaurants have found long-term success on Franklin Street. Linda’s Bar and Grill has been on Franklin for forty years.

Linda’s owner Christopher Carini said business has been continually better since he took ownership of the bar and grill in August 2011. He said there is no secret formula or strategy to maintaining good business.

“I have to caution you with trying to look for a silver bullet,” he said. “It does not exist. Good value, quality product, excellent service. Those are the things you do.”

Benny Cappella’s has managed to escape the recent business turnover as well, despite it only having been open for nine months.

Benny’s owner Chris Brown attributes part of the new restaurant’s success to the way they target customers. He said their late hours and accommodations have helped business.

“It’s who you’re catering to — students versus families,” he said. “We try to cater towards students. We have patience for drunk people whereas some businesses do not.”

Brown also said that the specific location on Franklin Street, near Top Of The Hill Restaurant, Brewery and Distillery, has helped Benny’s.

“We wanted to be near TOPO because it’s iconic and it’s the best bar in town,” he said. “I think it’s just the fun college atmosphere in the place. When you come in here, it’s like the party continues.”

Brown is not the only one who thinks certain parts of Franklin Street provide better business than others. Trolly Stop Hot Dogs is moving this weekend from 306 West Franklin St. to 104 West Franklin St., next to Benny’s and in order to attract more business.

The Trolly Stop employee Eric Martin said that while the rent is higher in the new location, he thinks the move is better for business.

“We think it’s worth it because it’s a larger place, and we feel like the foot traffic is gonna be a lot better there,” he said. “We want to do a game room — pool table, pingpong, because we want to appeal to the students.”

Zoller said that despite the business turnover on Franklin, the Carolina Square Project — a mixed-use development that will bring offices, residential space and a Target to Franklin Street — would ultimately help keep businesses on Franklin Street.

Zoller said students patron downtown Chapel Hill while townspeople go to Durham to do their shopping. With Target moving to downtown Chapel Hill, he said the area will attract more shoppers.

“My impression is that Franklin Street is gonna go through the renaissance,” he said. “I think that downtown Chapel Hill will become a destination again.”

@meg_srik

city@dailytarheel.com