Daily Deal Sites Blamed For Driving Restaurant Out Of Business

CHICAGO (CBS) — Popular daily deal sites are blamed for driving a hot dog diner into debt.

As WBBM Newsradio’s Julie Mann reports, this was the final week of business for vegan hot dog restaurant owner Drew Baker.

LISTEN: WBBM Newsradio’s Julie Mann reports

He closed his 16-seat Lincoln Square eatery, Drew’s Eatery at 2207 W. Montrose Ave., after daily deal offers didn’t produce the customers and the revenue he anticipated, the Chicago Sun-Times reported.

He tells the newspaper he turned to several daily deal companies – among them Groupon Now and Living Social – to offer discounts. But customers who cashed in on the deal never returned to spend full price on a meal, the Sun-Times reported.

He tells the paper he lost $20,000 in his final offer with Living Social, in which customers paid for $10 to $20 worth of food at his restaurant.

Baker tells the paper he has only himself to blame. He says he didn’t calculate his risk in offering daily deals.

He tells the Sun-Times he will open one last time on Saturday before liquidating his restaurant and calling it a day.

  • Jim Hamilton

    Baker tells the paper he has only himself to blame

    But the headline reads

    Daily Deal Sites Blamed For Driving Restaurant Out Of Business

  • Ryan

    Did anyone think his problem might be that he tried running a VEGAN hot dog restaurant in CHICAGO!?!?

    Why would anyone want a vegan hot dog when they could get a real one at the thousands of Chicago Dog places??? No one came back because vegan hot dogs probably aren’t that good hahaha. Not the deal sites fault

    • Casey

      Amen, brother!

    • tim

      Because vegan hot dogs taste great and the real thing is gonna kill ya! Or at a minimum will make you 300 lbs and suffer a heart attack in no time. I applaud this man for offering a healthy alternative.

      • Al B.

        I DON’T THINK SO TIM!!

      • Bob

        And how many did you buy, Tim?

  • john

    It would take more than a coupon for me to eat a vegan hot dog. In fact I can’t think of any thing that would make me want to eat one. I wonder do you put ketchup on a vegan dog?

    • marla

      try it, you’ll like it….

      • Shea

        Stop being so smug. How do you know anyone else’s tastes? You don’t. You certainly do not know my tastes.

        For me, nothing replaces meat – if you want to eat that kind of food, that’s fine. I want to eat at least one portion of meat with basically every meal.

        Your arrogance is astounding.

  • renee

    Coupon Sites are EVIL. For companies out there, damned if you do and damned if you don’t it seems. (participating in online coupon deal offerings) I feel for businesses these days. LOTS of obstacles, especially with the economy as it is. Too bad.

    • Lethe

      I agree, Rene. I’ve noticed that restaurant prices have taken a hike recently…about a 20% hike, which, incidentally, is about what you save if you come in with a coupon (unless it’s a two-for-one, which most aren’t). There’s no such thing as a free lunch, folks, so the only thing all those proliferating coupon sites have done is make things more complicated. Instead of just going out to dinner, now you have to search for deals all over the web first, or feel dumb for paying full price when everyone else in the place is waving coupons around. I don’t think anyone expects to pay full menu prices anymore.

      • Ed

        I find myself going through coupons much more these days to determine where I will eat. Reality sucks, especially in a small business. At the same time, a vegan restaurant in Chicago just makes me laugh.

    • Shea

      I’m not sure what your belief system is, but I have yet to see any belief system that has “coupon sites are evil” as a tennet.



    • Brett

      You realize that coupons are a way of creating return customers, right? Shop owners are betting that if they can get you to try their product, you’ll come back for more.
      This isn’t some kind of OH NO I AM BEING FORCED TO SELL THINGS CHEAPLY obstacle, it’s a growth tactic.

      • Laura

        Yes. My favorite restaurant is one I discovered because of a coupon. We haven’t used a coupon since the initial visit and have been back a few times. Of course, if we come across another coupon we will use it :). Their prices are very reasonable even without a coupon.

  • Larry Horse's Arse Horse's Arse

    It’s not just this one business. These deals are an omen for many businesses. Many end up closing within a year of offering such a deal.

    We are in a terrible economic malaise. Right? Everyone wants to save money or generate money, right?

    The restaurants do these deals to get a cash infusion and business. What ends up happening a lot of the time is that the business cannot handle the crush of customers that results from the deal, the customers get bad service and report it on the internet (servers are notorious for not liking these deals because people might tip on the discounted total) and customers generally don’t return.

    So who benefits? The groupons of the world do.

    At some point, there will be less sites like this offering these deals. It’s not a good business model.

  • Shea

    If you want to succeed at running a restaurant, serve meat. Duh.

  • Jeremy

    So his restaurant wasn’t popular…and didn’t become popular after the daily deal sites…

    Like any form of advertising, it is not magic.

  • Lethe

    Retailers and restaurants are starting to build coupon deals into their pricing. So all that has come of the internet coupon craze is that no one, and that includes the sellers of the goods or services, expects anyone to actually pay the sticker price anymore. Another example of the internet making life a heck of a lot more complicated. Oh, well, at least I can still watch movies and TV for free on line. For now.

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