Each time you purchase a cheeseburger at a fast-food restaurant or treat your family to dinner at a full-service restaurant, you're contributing to a $500 billion industry.
Sales in the restaurant industry nationwide reached nearly the one-half trillion dollar mark in 2005. In Vanderburgh County, annual sales approached nearly $400 million, making the restaurant business an important piece of the local economy.
The industry extends beyond restaurants. Area wholesalers of food and supplies also reap heavy sales from doing business with the area's restaurants. Some of the larger chains rely on their corporations' regional wholesalers for orders and shipments. Other restaurants buy much of their food and supplies locally. The prime suppliers in Evansville include Sam's Club, GFS Marketplace and Farm Boy.
Slowly - but surely - much of the local restaurant business has become dominated by large franchise operations, a pattern that mirrors what's happening throughout the nation.
Because Evansville is a college town and a place where many young people choose to raise their families, the city is ideally suited for the restaurant industry, and it frequently attracts new restaurants to the area.
Though the industry isn't Vanderburgh County's largest employer, restaurants here employ a substantial number of workers: nearly 8,500 of the nation's 12.2 million restaurant employees. But entry-level restaurant jobs are among the lower paying in this area, according to Mohammed Khayum, dean of the University of Southern Indiana School of Business. He said a restaurant worker typically grosses only about $1,000 a month locally.
Some who are employed in restaurant management by the larger franchises can earn in the lower $30,000s, according to Harold Wallace, a franchisee of Evansville's Old Chicago Pasta & Pizza chain restaurant.
"A bonus can bring another $5,000 to $15,000 or more a year," he said.
In spite of the low entry-level wages, Khayum believes the restaurant industry is important to the area.
"It's one of those sectors that is experiencing consistent growth," he said.
Khayum ranks the restaurant industry as Vanderburgh County's fourth largest employer. He said the health care/social services industry ranks No. 1 with more than 17,000 employees. The manufacturing industry ranks second with more than 15,000 employees, and the retail trade industry ranks third with more than 13,500 employees.
Khayum put the employment turnover rate in the restaurant industry in Vanderburgh County at about 20 percent, the same as that in the nation and in Indiana.
The rise in franchise restaurants has been phenomenal in recent years in Evansville and across southern Indiana, southern Illinois and western Kentucky.
The region still has a fair number of independent, mom-and-pop style restaurants and larger independently owned establishments. However, it's becoming tougher for the independents to stay in business.
Why are national chains so effective? Industry surveys show people who dine out are concerned most with the atmosphere and cost.
Franchise operations provide trendy atmospheres that especially attract younger diners, said Khayum.
The chains also buy supplies in extra-large bulk amounts, enabling them to offer lower prices to their customers.
"If you buy groceries for 100 units vs. one or two units it reduces the cost by at least 2 percent to 5 percent," said Old Chicago's Wallace.
The chains also have enormous marketing budgets that allow the restaurants to advertise widely in print and on television and radio, which gives them even more of a competitive edge for attracting patrons.
All in all, local independents have a difficult time competing, Wallace and Khayum agreed. Khayum believes some independent owners will continue to survive through word of mouth and personal attention to service and food quality.
Wallace believes there'll be fewer and fewer locally owned restaurants in coming years, though he personally hopes the small operations don't keep dwindling.
"When I'm off work I don't want to eat at a chain restaurant all the time. I like going to the locals," he said.
Wallace noted many of the popular chain restaurants got some of their ideas in food and service from locally owned independent operations.
"Restaurants like Chili's and Applebee's are really big chains today, but they didn't start out that way. They've grown largely because of the service they provide," he said.
Large chains sometimes own and operate all their stores or offer some of the operations to franchisees. Wallace said the Old Chicago restaurant in Evansville is one of the few in the Old Chicago chain that isn't owned and operated by the corporation.
Having no franchise fee to pay is an advantage to being an independent owner of a non-chain operation. Wallace said franchise fees typically amount to 4 percent to 6 percent of a restaurant's gross sales.
While all the advertising available through the chains is beneficial, it's not free either. Wallace said a franchisee typically contributes 1 percent to 2 percent of the business' gross sales to support the corporation's marketing.
"But it's necessary. You have to keep your name out there," Wallace said.
The chains compete with one another - and that's not easy, Wallace said.
"Old Chicago only has about 78 locations in the nation vs., say, Applebee's 1,400. It's a challenge to build support when you're new in town."
Wallace said it's important to create a culture that cares about people, and not just about the gratuity.
"Sometimes chains get so big they forget about that. But it's necessary to put the customers first."
As a newcomer, Wallace said he also found it important to support local charity.
"If you don't give back to the community it won't support you," he said.
Old Chicago donated more than $5,000 to CAPE (Community Action Program of Evansville) when the restaurant opened off the Lloyd Expressway East last year and it continues to support programs that aim to eliminate hunger and homelessness, Wallace said.
Now that he and his business partner, Paul Friedberg, have the local Old Chicago up and running, they're preparing to open their second restaurant - another Old Chicago, in Louisville, Ky., this month. They do business as OCI Enterprises Inc.