Kalene Griffith, CEO of Visit Bentonville, took seven Norwegians out to dinner last week after the Scandinavian group visited to research the city’s trail system.
Griffith chose a wood-stove pizza restaurant, which drew praise from her Norwegian guests. They especially loved the pimento cheese dip and pepperoni-jalapeno-honey pizza.
“They said they did not anticipate that every restaurant they went to [that] the food was phenomenal,” Griffith said. “The culinary scene was something they couldn’t imagine. They were looking for places they could experience the community. That is one of the things Arkansas brings to the table: There are unique experiences in every area.”
Northwest Arkansas’ population is becoming more diverse as it grows, and the area’s restaurant industry is hitching along for the ride. A report by the National Restaurant Association showed that there were 5,400 restaurants employing 121,100 workers in Arkansas in 2018, with a projection that employment would grow 9% in the next 10 years.
Montine McNulty, the executive director of the Arkansas Hospitality Association, said the 9% projection is great for a relatively small state. The industry has been on an upward trajectory in the past decade.
“We have had the ninth year in a row for growth in the restaurant industry in Arkansas,” McNulty said. “That is unbelievable. It is a very competitive business. There is a lot of business interest in Arkansas.”
Revenue from Bentonville’s 1% Advertising & Promotion Commission tax on restaurant food and nonalcoholic beverages was up 6.3% in 2018 over the previous year. Revenue from Fayetteville’s 2% A&P tax on restaurants was up 3.7%. Lowell began collecting a restaurant tax in June, so no year-over-year trend is available.
Rogers and Springdale do not levy A&P taxes on restaurant sales. J.R. Shaw, the executive director of Visit Rogers, said restaurant sales in the city were estimated at $123.7 million in 2015 and rose approximately 20% over the next two years.
Shaw said Rogers is seeing new restaurant interest in its resurgent downtown and in the south of town.
Bentonville’s restaurant tax roster for January 2019 showed a total of 184 restaurants paying $117,000 in taxes. (Public release of A&P taxes remitted by individual restaurants, the data Arkansas Business long used to create lists of top restaurants, has been prohibited by state law since 2015.)
Largest Commercial Real Estate Deals
► Benton County
► Pulaski County
► Washington County
Bentonville’s January collection was up slightly from the same month of 2018, when even more restaurants, 195, collected $114,500 in taxes. For Griffith, any increase in January is a good harbinger because the month is normally the slowest of the season since there are fewer visitors and sporting events and many people are tightening their discretionary spending after Christmas.
“We do not base our year on January. Ever,” said Griffith, who was still pleased by the $3,000 increase. “If we are up by $1,000, $2,000, $3,000, $10,000, we’re happy with our January. There is no apples-to-apples on that. We look at the collections rather than the numbers [of restaurants] that are open or not open.
“Currently the restaurant industry is flat in January but we are very happy to have it flat.”
Griffith wasn’t concerned about having 11 fewer restaurants. She said the industry is notoriously brutal with a high turnover rate, and the count includes food trucks, which can move on without closing.
Griffith said the city expects and has experienced a few notable openings each month. She expects a bakery, a bagel shop on the downtown square and a cafe to open in the coming weeks.
“We continue to grow in northwest Arkansas,” Griffith said. “We are still seeing that increase of people, and they are going out and [finding] unique experiences. I do think our restaurants are doing well.”
McNulty, with the Arkansas Hospitality Association, said a good economy and low gasoline prices help people have more discretionary income to spend on experiences such as dining out. That doesn’t always mean restaurants, as some people pick up food from farmers markets or farms to prepare themselves.
“There is a continued interest in the culinary scene in general, and northwest Arkansas is certainly experiencing that,” McNulty said. “More and more people are eating away from home in one way or another. That is going to continue. For now it looks like we are going to continue to have good growth.
“Northwest Arkansas is having an extraordinary run at good food and good restaurants.”