But keeping a vast inventory requires a feel for demand and an intimate knowledge of shelf life. An experienced coffee-shop owner who offers three kinds of steak knows that his porterhouses, vacuum-packed in Cryovac plastic, will last two or three weeks in the fridge. Some menus go so far as to offer lobster—which in turn calls for installing a tank, running to a friendly supplier around the corner, keeping a few packaged lobster tails around and hoping they don’t get freezer-burned, or storing a crate full of damp seaweed and live crustaceans in the fridge, hoping they’ll sell fast. (And offering a special on lobster Newburg the next day if they don’t.)
Even the basic cup of coffee is becoming a problem. At the low end of the business, street carts are flourishing—there’s one on the corner across Broadway from the Happy Burger—and Korean grocers sell coffee for 50 cents a cup. At the high end, Starbucks continues to spawn franchises, two of them within a block of the Happy Burger. How Starbucks can get people to pay $1.68 for a plain cup of coffee is a deep mystery to the Tsolkas brothers.
And there lies the final problem. To a business analyst, the obvious adjustments would be to simplify the menu and raise prices. But Manhattan’s continuing gentrification is alien to many of the dinermen. They don’t have the décor, menu, or food presentation to compete for newer, hipper customers, and they resist change lest they alienate their old-school customers. (Who are perhaps likely to die off a little faster than their upscale neighbors: “People used to eat every day bacon and eggs,” John Tsolkas complains. “Now they listen too much to their doctors.”) The Happy Burger, with its sunny waitress, Sylvia, was a lifeline to its elderly regulars. Ancient Sydney, with his bowl of cereal and 25-cent tips. Nannies, doormen, supers, cops. A British voice-over guy, Robert Mackenzie, reading scripts at the counter. Henry the ex-boxer, who had so many heart attacks in the Happy Burger that Sylvia was tempted to call an ambulance whenever he walked in the door. The hardest-core regulars kept their own condiments behind the counter: three kinds of maple syrup and a jar of honey clearly labeled property of the weizners. Try finding that at a Starbucks.
Some owners, loath to raise their prices, try to hang on simply by working harder and faster. Dimitri Kafchitsas, president and CEO of Pan Gregorian Enterprises, says, “They keep swallowing the raises until they just give up.” The Cosmic Coffee Shop guys have contemplated extending their day to 24 hours. Others, Kafchitsas says, have long leases and substantial reserves from decades of successful operation. They’re living on borrowed time, and it’s running out.
Still, some dinermen are finding ways to stick around. Fanis Tsiamtsiouris owns four Upper West Side coffee shops, all on Broadway between 77th and 100th streets. Though he operates on instinct like his compatriots at the Happy Burger—“You don't go to school for this,” he says—Tsiamtsiouris seems to have found a business model that’s more in tune with the times. He’s streamlined the menus at his restaurants, losing the broiled bluefish, keeping the Jell-O and cottage cheese, and adding a few high-margin items that cater to relatively upscale tastes. “A few years ago,” he says, “I bought endive salad for $40 a box. My friend told me, You’ll lose the store! You don’t know how to buy.” But Tsiamtsiouris charged $9 for each endive salad and learned a valuable lesson.
He kept going, paying a decorator $40,000 to give the City Diner a slick quasi-Deco look. For the Key West, he chose tropical colors—very Miami Beach, or at least Miami Beach by way of the restaurant-supply houses on the Bowery. Sitting in his bustling Metro Diner, Tsiamtsiouris looks at his flashy décor and his new menu. “You take the American dream and mix it with the Greek dream,” he says, “and this is what you get. A mishmash.”
You also get the fallout of gentrification. When the City Diner—formerly the Argo—got its face-lift in 1996 and raised its prices, local scuttlebutt had it that some of the old crowd was encouraged to move on. “A guy who’s eating a filet mignon doesn’t want to sit next to a toothless grandmother nibbling on a toasted corn muffin,” a waiter at a nearby coffee shop snipes. (Then again, at least one of the Happy Burger’s regulars has made the Key West his new home.) Other clientele shifts came as well: “Intellectuals don’t like tropical,” Tsiamtsiouris reports.
In the forties and fifties, the basic coffee shop slapped on some chrome and became a diner. From the diners sprang hamburger places like the Jackson Hole chain, panini shops, and the glass-mosaic-tiled Moonstruck chain. Adaptable and forward-looking, these hybrids make more sense in the unforgiving Manhattan arena. Moreover, the owners are likelier than many to succeed. Kafchitsas notes that they have decades of coffee-shop experience in the family and “know where their penny goes,” innately balancing volume with profit margin.
Then again, not everyone’s so impressed. Ask Frank Tsiamtsiouris about his future, and he’s pessimistic. It’s customary for dinermen to sell these restaurants in installments rather than for one lump sum, and he worries that the likely buyer is someone who doesn’t really comprehend the business. “He will not do well,” Tsiamtsiouris predicts, “and I will lose my money.”