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Accuracy • Independence • Integrity

September 20, 2017   |   Ithaca, NY

News

Study shows chains thrive in Ithaca despite recession

Ithaca is regularly recognized for restaurants like Moosewood and its thriving farmer’s market, but it is rarely considered a fast food mecca.

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From left, freshman Ryan Bince and sophomores Alec Mitchell and Madeline Wingerath chow down Tuesday at Five Guys Burgers and Fries in Ithaca. Kevin Campbell/The Ithacan

However, a recent study conducted by Pitney Bowes Business Insight ranks Ithaca as the third fastest-growing quick-service, or fast food, restaurant city of less than  250,000 people.

Quick-service restaurants are classified as chains that provide quick and inexpensive service to customers — including fast food restaurants or places like Applebee’s and Five Guys Burgers and Fries.

Nearby Buffalo and Rochester were ranked first and third in U.S.  markets of more than 1 million.

Alan Beery, director of client services at Pitney Bowes, said the research company spent two months evaluating the competitive intensity between restaurants, unemployment levels and housing prices when determining the rankings in the fall. Beery said this information was compiled into an aggregate index that could be compared to other cities in similar markets across the country to determine their rankings.

“We looked at the number of those relative to the households in each market, so we’re able to assess how intense the competition was,” Beery said.

Beery said stability, despite the economy, was a key trait the top-ranked cities possessed; it was this stability that allowed markets in New York state to grow while markets in the Midwest and Southeast slumped, Beery said.

“One of the things we saw in the markets that didn’t make the list is that some of the areas like Arizona and Las Vegas had some really difficult challenges with the economic environment that we’re in,” Beery said. “The areas in downstate New York and some of the areas in the Pacific Northwest … tended to be much more stable in terms of the economic changes in the future.”

Jean McPheeters, president of the Tompkins County Chamber of Commerce, said the high ranking could be because of an influx of national chains in the city.

“We haven’t had those kinds of national chains until really relatively recently, in the last five years,” McPheeters said. “That’s where I think the growth is coming from — not the drive-throughs, but the stop-ins that have a national characteristic.”

McPheeters said Ithaca is an ideal setting for opening a restaurant because of its younger, educated population and an unemployment rate of 5.5 percent, which is relatively low.

“If you look at our county as a whole, it’s 100,000 people and we have about 27,000 students,” McPheeters said. “They’re used to eating fast food, and they like it in general, and so they seek it.”

Steve Braman, franchise owner of Subway at the Ithaca Mall and Buttermilk Plaza, said he attributes Ithaca’s friendly business climate to the city’s makeup, including the presence of two colleges, The Commons, a mall and Cayuga Lake.

Braman said these features allow for strong periods of demand and minimized loss of sales during periods of low productivity.

“You’ve got an influx of 50,000 students every year,” Braman said. “You know they’re coming. And then their families come and visit so you know that’s there, too.”

McPheeters said the Ithaca’s demographics holds the key to the growth of quick-service restaurants.

“This is a place with relatively low unemployment compared to most of the country, with very highly educated people compared to most of the country, and good housing prices,” McPheeters said. “We just haven’t bottomed out like a lot of other places.”