Jonesboro, AR – (JonesboroRightNow.com) – Oct. 3, 2025 – Within the last two weeks, local food establishments announced that they’re closing their doors.
Demo’s Smokehouse on Highway 49/East Johnson at Hilltop announced it is consolidating with its South Main Street location, due to being offered to lease out one of its buildings. The Bistro House, located inside the Jonesboro Cycle and ATV store in Bono, officially closed Saturday. The Red Wolf Boulevard Starbucks closed Sunday.
Jonesboro Right Now asked several local business owners to share their opinions on the current business environment for the restaurant and food service industry.
Tom Fielder, owner of Fat City Steak and Grillhouse, said the restaurant business is as difficult as he has ever seen it.
“I’ve been in it since 1990, and I hate to use the word, but COVID, I think, has driven a lot of what we’re seeing,” Fielder said. “Even five years after Covid, the cost of goods has increased exponentially. I’ve never seen the cost of goods increase at the rate that they have… and then you have the increase in labor expense.”
According to Fielder, since COVID, restaurants have had to pay wages considerably higher than minimum wage, which is $11 an hour in Arkansas.
“We’re getting hit. If your food cost is increasing 30, 40, 50% in five years… and then your labor cost is doing the same in five years… and then you have inflation and tariffs to battle… you’ve got someone making $16 now that quite frankly is struggling as much or more as when they were closer to minimum wage because their dollar is not going as far.”
As a result, he said the disposable income for customers has decreased, and they’re still not seeing as many diners through the restaurant door in the months and years since COVID.
Although he said foot traffic is increasing, it doesn’t compare to 2019 averages and to-go business has increased.
“I’m a full-service restaurant and so originally, we just were not set up to do that much to-go business. I used to think that 5, 6, 7% was a lot. If I did 5, 6, 7% of my sales in to-go business… hey, I was really happy with that,” Fielder said.
While to-go business has certainly pulled back from COVID, Fielder noted the difficulties they faced coming out of the pandemic and trying to handle the much-needed increase in foot traffic while still doing 35-40% in to-go business.
“Now it has settled back down, but foot traffic has not completely come back to the 2019 level for us. So, the environment is just… It’s unlike anything I’ve ever seen,” Fielder said. “Every day is a new day. Every day I look for another way to increase foot traffic. We still have some fantastic weeks, we have some fantastic weekends, but overall, we’re just kind of bouncing along to the point that it makes it difficult on all of us.”
While tariffs play a small part in what the restaurant industry is doing, Fielder said he thinks it really comes down to how quickly inflation increased over the last five years.
James Best, owner of Skinny J’s in Jonesboro, Paragould and North Little Rock, said one problem for many restaurants is the lack of consistency.
“While it can be really busy one week, it can be a ghost town the next week. So, it’s hard to get a grasp on staffing and ordering and all that fun stuff,” he said, noting that he believes it is tougher now than what people realize, especially, for locally owned restaurants like his. “Our food cost and all of our costs are just crazy high. I mean, my steak jumped $4 a pound in the past three weeks. I mean, how do you plan for that? And then, we’ve got to adjust our menu costs, and it’s a nightmare almost pricing yourself out of business.”
Best said he thinks these are “scary times” right now due to economic recession.
“It’s crazy… a coffee shop, especially one like Starbucks closing down, it’s kind of scary,” he said. “I don’t know what the traffic count is on Red Wolf Boulevard, but I would think that would have been one of the busiest locations.”
He also noted that the farm crisis is affecting businesses as well.
“I farm with my brother, and I can see when the farmers aren’t doing good at my restaurants. I mean, when it rained last week, normally we would be full of farmers because they get a day off and there wasn’t any of them in there,” Best said.
READ MORE: Northeast Arkansas farmers meet with government officials to discuss farming crisis
For now, Best said he believes restaurants are just trying to hold out as long as they can until things get better and trying to be prepared. But he says it’s been tough. While this time of year is typically a slow time, it’s been even slower than what he anticipated.
“Right now, just trying to keep your labor and your spending costs down is difficult to do because we still have to pay people. They depend on us for jobs; and we’re trying to keep the hours for them and not go broke in the process,” he said.
Michael Davies, owner of Lazzari’s Italian Oven in Jonesboro, noted how too much competition can affect businesses as well.
“There are too many restaurants in this town for what we’ve got, I mean there’s new ones popping up everywhere,” he said. “That’s the problem… with every one that comes there’s usually two that close. If you drive around and look at every one of these little strip malls, you’ll see so many little pop-up restaurants in them. It’s unreal.”
According to Davies, running any business is tough right now. He said seeing restaurant closures doesn’t surprise him.
“It happens all the time, I mean it’s been going on for years like that. It’s always been that the new ones will come in, and old ones will close because they just don’t have enough business… There’s not enough people to go round for all the businesses that are here. I mean you try to bring something in that people don’t have or people want more of and you know it’s hard to corner the market anymore,” Davies said.
Davies also noted that some of the biggest challenges for restaurants and retail establishments are goods and labor costs, and reliable help.
“It’s very tough trying to find workers that want to work. I mean they want a paycheck, but they don’t want to work,” Davies said. “If you don’t have people coming to buy, and you don’t have people coming to eat… You can’t afford to have people there, and you’ve got to have people there to serve them so your kind of in a ‘Catch-22.’”
He noted that because the chain restaurants seem bigger, they get the support, while the little “mom and pops” are hurting the most right now. The biggest thing that people can do, he said, is support their local businesses and restaurants.