SMALL BUSINESS

Rising cost of food takes bite out of Lombardi's Pizza

A young diner savors a slice of pizza at Lombardi's Pizza at 32 Spring Street. (Jefferson Siegel/ amNew York / May 4, 2008)

By Farnoosh Torabi | Special to amNew York

5:19 PM EDT, May 4, 2008

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As consumers fight escalating food costs and rising gas prices, inflation also hurts an already challenged small business category in the city: restaurants.

John Brescio, owner of the 103-year-old Lombardi's Pizza in Little Italy, is combating dramatic price increases in his key ingredients -- flour and tomatoes. "Four weeks ago we went from $12 for a 50-pound bag of flour to $38 per bag," says the 59-year-old.

Also, cases of red tomatoes, which he imports directly from Italy, are up a whopping $4 and now cost $22. Nationwide, wholesale prices -- including food and gas -- were up more than one percent in March, according to the U.S. Department of Labor.

Profits at Lombardi's are down a staggering 20 percent compared to the same period last year, Brescio says.

"I haven't seen something like this ever happen, really," says Brescio. "Everything you can think of went up."

The pricing chaos has, for the most part, been a behind-the-scenes battle at Lombardi's. To help offset his rising costs, Brescio, who took over the famed Italian eatery in 1994, has only raised the price of his large pies by $2 to $23.

He has limited the number of paid workers, replacing them with the volunteer efforts of family members, including his wife and sister-in-law. His son also works at the restaurant. Brescio, himself, who had scaled back his hours after heart surgery, is upping his hours at the pizzeria, too.

Despite his financial hardships, Brescio admits that Lomardi's, which seats 120, is one of the luckier eateries in New York.

With or without inflation, running a restaurant in the city is already a tough task -- one shuts down every four days, according to a Zagat survey.

"There are a lot of smaller places that are really, really hurting. You see a lot of restaurants close up," he says.

Bagel shops, in particular, he notes, are among the hardest hit due to the climb in wheat prices.

"But I'm in a position where I'm making it," says Brescio.

Even while Brescio's outlook on the economy and the state of inflation is bearish, he's convinced his pizza business can continue to weather the storm because pizza is, after all, relatively cheap eats.

"[People] can't afford the high-end places. [Lombardi's] is where people are going to come to when they go out to dinner."