Running a restaurant isn’t for the faint of heart.
You can put your blood, sweat, tears, and family recipes into your business, only to find yourself struggling to make ends meet — even if every booth in the place is filled night after night.
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Restaurants tend to operate on tight margins. And in recent years, they’ve been squeezed more than usual due to persistent inflation.
Related: Beloved Mexican restaurant closing iconic location after 63 years
The typical full-service restaurant, if it’s lucky, has a 5% profit margin due to higher labor and ingredient costs.
Consumers can complain about paying high prices for restaurant food and drinks. But restaurants need to charge what they do to cover the cost of staying in business.
Remember, restaurants have a lot of overhead that’s not just reflected in the staff members they employ and the items listed on their menus. The costs of operating a restaurant run the gamut from keeping the lights on to stocking the toilet paper and soap in the bathrooms.
When those costs keep rising, something has to give.
Major city loses popular Mexican restaurant but gains another.
Image source: Getty Images
Restaurants have been shuttering in short order
The past few years have seen their share of high-profile restaurant closures.
Red Lobster abruptly closed dozens of restaurants last year in conjunction with filing for bankruptcy. Even though fans of the chain loved its menu and famous endless shrimp promotion, the company couldn’t hang on.
Related: Iconic restaurant closing its doors after 32 years
TGI Fridays, another popular chain, filed for bankruptcy in 2024 as well. Despite fans’ familiarity with the chain’s classic menu, a prolonged decline in sales led to a world of financial woes.
But it’s not just chain restaurants that have been forced to say goodbye. In recent years, a number of popular local restaurants have closed their doors as well.
One Market Restaurant, an iconic San Francisco eatery that was the recipient of many prestigious culinary awards, announced recently that it’s shutting down in mid-June.
And in San Antonio, Oscar’s Taco House, a beloved old school-style restaurant known for its delicious Mexican fare, is closing its doors in June as well.
Popular Mexican restaurant closes but gets replacement
When a local favorite restaurant shutters, one thing that can help soften the blow is the promise of a fantastic new restaurant to replace it.
In Denver, El Noa Noa Mexican Restaurant recently closed its doors after a successful 45-year run. Owner Vidal Banuelos said the restaurant never managed to fully recover from the blow of the pandemic.
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Even once Denver lifted dining restrictions, El Noa Noa lost its lunchtime crowd as companies allowed employees to continue working from home on a long-term basis.
“The cost of everything went extremely high and our profit margins were basically disappeared,” Banuelos told the Denver Post. Ultimately, he just couldn’t hang on.
At the time of El Noa Noa’s closing in April, Lorenzo Nuñez Jr. of El Chingon fame found himself in an interesting spot. His popular restaurant had shuttered more than a year prior, and he was hoping to reopen in a new, reimagined space.
With El Noa Noa clearing out, Nuñez jumped on the opportunity to scoop up its Santa Fe Drive location. Now, fans who are bemoaning the loss of El Noa Noa will have an opportunity to enjoy delectable Mexican classics such as chile relleños, enchiladas, and carne asada at the new El Chingon.
But Nuñez said he plans to introduce exciting seasonal menu items, too.
The new El Chingon will also offer a menu of fun cocktails, and the iconic patio will be open during the summer months.
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“Having the opportunity to take this over from the family is a challenge to follow in their footsteps, but also an opportunity to carry on a legacy, if you will,” Nuñez said.
Banuelos is excited to see a new Mexican restaurant take over the space he’s leaving behind. And he hopes Nuñez’s venture is a huge success.
Related: After closing 600 locations, fast-food chain has many more planned
