Amid widespread reports of restaurant closures and economic pressures on the industry, a number of restaurateurs in Los Angeles are pursuing a different strategy focused on small-scale, steady growth rather than rapid expansion or high-profile ventures. These operators emphasize sustainable, neighborhood-oriented business models as a response to the challenges facing the food service sector.

Richie Lopez, who opened Pontu in Ocean Park three months ago, exemplifies this approach. His Peruvian chicken restaurant operates from a modest takeout window and a small outdoor patio, serving customers daily from midday until early evening. While the 30-seat interior remains closed for dinner and a beer and wine license is pending, Lopez expresses no regrets about his timing despite a difficult market for restaurants. "Opening a restaurant is like having a baby," Lopez said. "There’s never a right time. You just do it."

Further inland, Alfonso “Poncho” Martinez runs Lugya’h at Maydan Market in West Adams. The eight-month-old venue is part of a shared space that houses seven small restaurants, designed by operator Rose Previte to reduce overhead through shared kitchen facilities and equipment. Martinez, previously renowned for his tlayuda stall and a James Beard outstanding chef nomination, has adapted by focusing on a concise menu, offering four main variations of the traditional Mexican dish. Lugya’h was recently added to the Michelin Guide’s roster, underscoring its growing acclaim. Martinez operates the business with partner Odilia Romero, valuing sustainability and steady progress over rapid expansion.

Industry observers note that this movement toward scaled-back operations reflects a broader correction after two decades marked by rapid growth driven by social media, celebrity chefs, and venture capital investment. The previous era often prioritized instant stardom and aggressive growth, a model that proved unstable for many. The current climate, characterized by rising costs—including food supplies and transportation—and shifting consumer behaviors, encourages restaurateurs to be more strategic and cautious.

Shared spaces like Maydan Market offer a hybrid service model that balances efficiency and hospitality, with pared-down menus intended to manage costs and minimize waste. Similarly, Lopez’s limited menu at Pontu consists of six main dishes, five sides, and a children’s plate, aiming for operational simplicity. Some establishments incorporate sustainable practices to reduce expenses, such as Tomat in Westchester, which grows vegetables in an urban garden and strives for minimal food waste.

While the lure of large-scale success remains for some—such as potential product development or brand expansion—many industry professionals emphasize the importance of prioritizing the core restaurant experience. Previte envisions a future where products like Martinez’s tlayudas might reach broader markets, but underscores that expansion should be a consequence of sustained, well-managed growth rather than the initial goal.

As consumers cope with inflationary pressures that affect menu prices, industry representatives urge a shift in perspective, encouraging patrons to explore affordable options, from kids’ menus to late happy hours, rather than blaming restaurants for economic forces beyond their control.

The term “third space,” referring to communal venues outside of home and work, gains renewed relevance in a post-pandemic environment where social connection is increasingly sought after. Independent, small-scale restaurants represent important community anchors during this time, reliant on customers’ continued engagement to thrive amid ongoing uncertainty in the sector.