116 3rd St SE
Cedar Rapids, Iowa 52401
CEDAR RAPIDS — For many Cedar Rapids residents, the time when chain restaurants and franchises dominated the local dining scene is within recent memory.
Doug Neumann, executive director of the Cedar Rapids Metro Economic Alliance, remembers when downtown Cedar Rapids got its first locally owned, independent coffee shop in 2003.
“When the Blue Strawberry started, there was not a quintessential coffee shop,” he said.
Thanks in part to changing consumer habits, the numbers now show it’s not just coffee shops that have gone local. New data gathered by the Economic Alliance over the last year shows that Cedar Rapids is shedding its reputation as a city with mostly chain restaurants.
About 62 percent of Linn County’s 402 restaurants are now independent and locally owned, putting the city’s ratio significantly ahead of the state average and eclipsing neighboring counties. Johnson County boasts a local, independent ownership rate of about 60 percent.
Statistics in Economic Alliance data grouped franchises separately from locally owned or chain restaurants.
When the Economic Alliance undertook the massive effort to build a comprehensive database of local restaurants, they anticipated a split closer to half than close to two-thirds in the growing restaurant scene.
“We were fascinated by the outcome of this,” Neumann said. “Any remnants of the idea that this is a chain restaurant town really fail in the numbers that this study showed.”
Though American food dominates the list of locally owned restaurants, the types of food available in Cedar Rapids run the gamut. Mexican, Chinese and Indian food are among some of the largest restaurant categories.
“Variety is synonymous with locally owned.”
Despite the pandemic that the Iowa Restaurant Association estimates killed about 750 restaurants in the state, another key finding is the recent growth of local restaurants in Cedar Rapids. The Economic Alliance estimated that roughly 60 percent of all locally owned, independent restaurants here opened in the last decade.
Cedar Rapids a leader in Iowa for local restaurant ownership
While about two-thirds of all restaurants in Iowa are locally owned when including franchises, only about 40 percent are independent concepts, said Jessica Dunker, president and chief executive officer of the Iowa Restaurant Association. That puts Cedar Rapids’ proportion of local, independent restaurants “on the high end of what’s happening in the state.”
“It’s absolutely a trend in the market,” she said. “There has been tremendous growth and interest for the value proposition of (independent ownership.) The more local, the better off it is.”
With younger generational palates pushing for more adventurous tastes and international flavors in Iowa, she said over two-thirds of adults prefer to spend their money on an experience — like dining out — rather than buying an item to keep. Independent restaurants lend themselves well to quickly adapting to new tastes and habits.
The pitfalls of chain restaurants and challenges of local ownership
“Your creativity (at chains) as far as menu items is taken completely out of your hands,” said Manny Maldonado, co-owner of newly-opened Hospoda in the Czech Village, which serves wood-fired brick oven pizza and specialty craft brews.
Maldonado, who previously served as a regional manager for Perkins and a general manager for Buffalo Wild Wings, said consistency in price and taste at chain restaurants is traded for stymied creativity, where the ones making the food don’t have much ability to improvise.
One challenge of independent restaurants, he said, is not having the backing of corporate finances, marketing and advertising. But what was often perceived as a strength may not have helped chains as much as previously thought.
“The first places to close when we started having (pandemic) restrictions were the chains,” Dunker said. “For the chains, it was less personal.”
While corporations looked at underperforming stores and made decisions by the numbers, independent restaurants with owners who were visible in the community saw a surge of customers rally around them. Social media groups like Rally CAP in Cedar Rapids have spurred other groups like Deetz and popular local foodies like Joe Sample in a movement that has long outlived its original purpose — helping local restaurants survive the pandemic.
That’s part of a shift in the local mindset that may be here to stay, Neumann said. No longer is “buy local” messaging focused on just the holiday season.
“There’s a real intentionality about people’s choices that absolutely did not exist in any major way (before,)” Neumann said. “That exists as a collective now. It did not exist a decade ago.”
Dunker credits national trends like food tourism sparked by food television channels and the rebirth of craft cocktails and craft beer as elements that have all worked together to encourage exploration of new food and drinks.
Locally, the Economic Alliance credits growing incubators and trends with a variety of community stakeholders. The Downtown Cedar Rapids Farmer’s Market, NewBo City Market, food trucks and cloud kitchens have helped local restaurants and food-based businesses experiment with new concepts without the need for big investments at a brick-and-mortar location, said Julie Kraft, communications consultant for the Economic Alliance.
When independent restaurants do close, Economic Alliance data shows that they’re usually replaced with new independent restaurants.
Why locally owned restaurants are important
There are reasons for both the brain and the heart to support locally owned restaurants.
Research from Coe College’s Economics Department shows that 59 cents of every dollar spent at a local restaurant continues to circulate in the local economy. That money is picked up by taxes to pay for public services, Kraft said. But it’s not just about dollars and cents.
“Local restaurants like this — they give flavor to your community,” she said. “They add that uniqueness.”
“Variety is synonymous with locally owned,” Neumann added.
But what’s more is that by sprinkling the spice of life into the local dining scene, Cedar Rapids is positioning itself for a stronger future economy as cities compete to attract workers in a tight labor market. Good restaurants are part of the recipe for growth.
With local companies poised to expand, Neumann said that the region’s biggest barrier to growth is a lack of available work force. Restaurants that provide unique, memorable experiences have an impact that ripples beyond going out to eat.
“The place-making things are the things that will either bring people home here or draw them here,” said Laura Thomas, research and analytics specialist for the Economic Alliance. “These are the little, incremental steps we can make toward stopping our problems.”
By providing unique slices of life, local restaurants are embedded into their communities in ways chains can’t replicate. Maldonado said that’s an important element to build diversity in flavors, cultures and environments that brings vibrancy to a city.
“If you’re doing what we’re doing, you’re part of the community,” he said. “You’re the neighborhood place.”
Dunker predicts the “hotbed of interesting and innovative culinary talent” in Cedar Rapids will only continue to grow.
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