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Rick's Steaks Leaving RTM?


rlibkind
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the Down Home Diner seems spacious enough and given their history of health code violations (see page 27) maybe they should be shown the door?

You should have looked at page 26 as well as page 27. Anyone who does will discover that the violations found on May 5, 2006 were corrected by the time of reinspection 10 days later. So, they were made aware of a problem and fixed it. That's hardly the lengthy "history" of problems you suggest.

Given your suggestion, if one wanted to reward those operations at the RTM that have brought it renown, Down Home Diner would be a likelier candidate than Rick's Steaks. It also has more convenient hours than any other business at the market -- it's open from 7 a.m. to 7 p.m. weeknights, vs. 8 a.m. to 6 p.m. (allegedly) for other merchants, though many don't open until 9 or 10 and some close as early as 4:30. (Some of this has to do with security issues: the Down Home Diner has access from the street through it's own door, and access to the rest of the market can be restricted. But that's quibbling. If enough other operators in the market wanted to operate those hours, all the other market's doors would be open earlier and later.)

Bob Libkind aka "rlibkind"

Robert's Market Report

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the Down Home Diner seems spacious enough and given their history of health code violations (see page 27) maybe they should be shown the door?

You should have looked at page 26 as well as page 27. Anyone who does will discover that the violations found on May 5, 2006 were corrected by the time of reinspection 10 days later. So, they were made aware of a problem and fixed it. That's hardly the lengthy "history" of problems you suggest.

Bob,

Actually the point that I was trying to make was not so much as to pick on the Down Home Diner, but showing that Rick has been singled out by management and given the boot because of politics. As another example, Franks-A-Lot and Tokyo Sushi were both on the chopping block a few years ago but were given time to "clean up their act" because of problems with their operations. My question is why was Rick not afforded the same opportunity as these vendors?

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the Down Home Diner seems spacious enough and given their history of health code violations (see page 27) maybe they should be shown the door?

You should have looked at page 26 as well as page 27. Anyone who does will discover that the violations found on May 5, 2006 were corrected by the time of reinspection 10 days later. So, they were made aware of a problem and fixed it. That's hardly the lengthy "history" of problems you suggest.

Bob,

Actually the point that I was trying to make was not so much as to pick on the Down Home Diner, but showing that Rick has been singled out by management and given the boot because of politics. As another example, Franks-A-Lot and Tokyo Sushi were both on the chopping block a few years ago but were given time to "clean up their act" because of problems with their operations. My question is why was Rick not afforded the same opportunity as these vendors?

I was strictly addressing the insinuation made about the Down Home Diner. It was very unfair.

Franks-a-Lot and Tokyo Sushi had operational problems/real lease issues that had to be addressed; they were given a chance to address them and did. Let's face it, there are no lease issues with Rick's, at least in terms of lease violations, rent payments, etc. It's either about politics and retailiation (if you believe Olivieri) or it's about making the market better (if you believe the RTM). Or perhaps it's a bit of both, which is more likely than any single explanation.

Bob Libkind aka "rlibkind"

Robert's Market Report

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I was strictly addressing the insinuation made about the Down Home Diner. It was very unfair.

Nope, not trying to insinuate anything good or bad about the Diner (or any other merchant in the Market with violations in the health report), but using it as a an example of how there have been many minor bumps in the road (if you will) with other merchants in the past that have been successfully and pretty much seamlessly addressed.

I think that is most people have been blindsided with the news that Rick's was closing, since there was not much warning that it was going to occur.

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I'm assuming that you've all read the stories in the papers, linked above.

I think the Inquirer story contained much more useful background, so if you haven't read it, take a minute to do so now before continuing with the rest of my post.

I think there can be no doubt that current Market management is making some major changes in the way the market operates, and that my characterization of those changes as "mall management" is not that far off the mark -- but it's mall management with a mission, and that mission is to make it possible for the fresh food merchants to remain the primary element in the Market. The RTM's primary customer, in management's view, is the shopper looking for something to cook or serve at home, not the person looking for something to eat right now. I've already mentioned what I see as the goal of the new lease terms, which do ask those who sell the finished product to pay more than those who sell the ingredients, and given who the market sees as its core customer, I can't quibble with the strategy.

I'm sure that the merchants who stand to pay more, maybe much more, under the new terms are unhappy with them, and to the extent that they are, Rick Oliveri accurately reflects their concerns. And since I believe that eateries account for roughly half the Market's merchants (close: 34 out of 74, though some of those 34 sell both ingredients and prepared foods, like 12th Street Cantina and Hatville Deli) and more than half of its gross revenues, it is perfectly understandable that (a) one of their number would head the Merchants' Association and (b) the association as a body would be resistant to a lease plan that has restaurants pay more to keep the fresh food vendors viable. But the merchants don't own the market; the Reading Terminal Market Corporation does. If the owner is determined to implement a policy, there eventually comes a point where resistance is futile and, persuasion having failed, one must either accept the new reality or opt out of it. What I read between the lines of this dispute is that Rick Oliveri chose to do neither. In that light what happened was probably also inevitable, unless we aren't being told the whole story and Oliveri was actually willing to sign one of the new leases. His refusal to provide the data necessary to draw up one of those new leases, however, suggests otherwise.

One passage in the Inky story caused me to do a double-take:

The merchants, a famously independent lot who for years resisted even keeping to the market's stated operating hours, objected and resisted [to the new leases].

They argued that the nonprofit market should not be required to compete with for-profit groceries. The changes, they said, would harm the informal, idiosyncratic atmosphere that made the market famous and successful.

If accurate, then I think some of the merchants need to look in the mirror and ask themselves if they are nonprofit institutions. Whether or not they want to compete with the for-profit groceries, the for-profit groceries are competing with them. I could buy my cheese at Whole Foods for no more than I'd pay for it at Downtown Cheese, for instance, and most American consumers wouldn't care that the folks at Downtown know how to handle cheese while the folks at the WFM cheese counter may or may not. Perhaps they ought not "be required" to compete with the for-profit groceries, but if they want to hold onto their own profit margins, they need to whether they think they do or not.

Sandy Smith, Exile on Oxford Circle, Philadelphia

"95% of success in life is showing up." --Woody Allen

My foodblogs: 1 | 2 | 3

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While watching this thread I've remained quite because I am very much an insider, but I now feel it necessary to address a couple of issues. First off, Rick was NOT offered a lease, in any form whatsoever. As for his disagreement with the terms of the lease he was representing a constituency that also did not view the lease terms as being fair. Yet, those merchants that deemed the new lease terms unfair still received a lease. It was Rick, and Rick alone (excluding those who were previously not given a lease) who was not given an option to sign, or not sign.

Second, the concern for the future of the purveyors is a completely irrelevant topic in regard to Rick's lease. In no way will Tony Luke be a greater benefit to the purveyors. His rent will be the same as Rick's would have been, had he been offered a lease. Some have suggested that with a higher rent from Tony Luke's, the purveyors could better be supported. Remember, the rent is not an arbitrary figure, it is based upon location, square footage, and vendor type. For management to suggest that bringing in Tony Luke's will be a greater help to the Market than Rick's is complete propaganda, with the intent to persuade supporters of management's core objectives (to preserve the Market's purveyors...) that it's OK to take away someone's livelihood after 25 years because it is for the "greater good."

For those that continue to undermine the importance of the lunch merchants, please remember this: if not for them, the Reading Terminal most definitely would not have survived the past quarter century. It was the success of the those merchants (such as Rick's, DiNic's, Spataro's, Rocco's, and Pearl's) that enabled the Market to stay afloat through some extremely rocky years.

I could say much more, but my intent was simply to clarify some recurring misconceptions. Please don't hesitate to direct your questions towards me.

Joe (Tommy DiNic's)

Edited by jtnicolosi (log)
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Joe, glad you've gone from lurking to posting, so welcome to eGullet! Please don't hesitate to bring both the facts as you know them and your valuable perspective as a merchant to the discussions here. It assuredly will help keep us focused and honest!

The role of the lunch vendors in support of the market's mission is an important subject, one I hope we can explore in greater depth and detail.

Bob Libkind aka "rlibkind"

Robert's Market Report

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BTW, Joe, I hope that you haven't taken anything I've said so far in this discussion as "undermining the importance of the lunch merchants." They are indeed a valuable part of the Reading Terminal Market and helped it through the lean years and the years when the Reading Company neglected a prime asset right smack in its headquarters. (Spataro's, dating to 1947, and Joe's establishment, dating to the late 1950s IIRC, are two eateries that have been through all of the lean years, as has Bassett's Ice Cream.)

It does strike me, though, that the RTM could probably do as well as it does now with nothing but prepared-foods vendors -- IOW, as a huge food court. So I do sympathize with strategies designed to keep the fresh food merchants viable.

My recent trip to Seattle partly informs my stance. As I mentioned in my trip report on the Pacific Northwest board, it struck me that the balance at the Pike Place Market had tipped way too far in favor of the everything else at the expense of the producers' market, and I know that the issue of what balance to strike is a live one as the Pike Place Market wraps up its centennial year and contemplates some major renovation projects. Pike Place having far more square footage than the RTM, you still get a very good selection of fresh food vendors even with a smaller percentage of the market devoted to them, but there is a point past which such a market ceases to perform its core function. The RTM hasn't hit that point yet. But without good management, it could.

Sandy Smith, Exile on Oxford Circle, Philadelphia

"95% of success in life is showing up." --Woody Allen

My foodblogs: 1 | 2 | 3

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A valid long-term concern, Sandy. But I don't see how Tony Luke's over Rick's is going to influence producer survival. Only thing Tony Luke's might do is take some business away from other lunch merchants. Trading dollar for dollar is only good for Tony Luke's. The other lunch merchants will suffer.

Holly Moore

"I eat, therefore I am."

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A Philly native and frequent RTM vistor here. What's the status of the petition mentioned upthread? Any chance in heck that Rick's will stay?. I'm with Holly here. I think it's terribly unfair to the other merchants.

I've had Rick's steaks and had no objection to them. I think he's being treated dispicably.

Thanks for any updates.

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A Philly native and frequent RTM vistor here. What's the status of the petition mentioned upthread? Any chance in heck that Rick's will stay?. I'm with Holly here. I think it's terribly unfair to the other merchants.

I've had Rick's steaks and had no objection to them. I think he's being treated dispicably.

Thanks for any updates.

I don't imagine the petition has any real legal standing or significance. At best, I think it was a tool to call attention to Rick's situation. I don't remember the exact language of the petition when I signed it but it didn't make any demands. It was more to the effect of "I support Rick's staying at the Market".

FWIW, nothing anyone speaking on behalf of RTM has said has convinced me that 1) RTM's rationale for doing this is well thought out, fair and backed up with data and/or facts, 2) That whatever principles they claim are in play are being applied to all lease renewals in an even-handed and fair way or 3) That this isn't some form of payback.

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Rick Nichols' column in the Inky today, which can be found here, was nearly a "on-the-one-hand-this, on-the-other-hand-that" kinda of piece, until you came to the last paragraph. Parse it closely (not the easiest sentence to understand, and I suspect Rick, who knows how to write a clear, declarative sentence, obfuscated purposely) and you can figure out what he really thinks:

But before they sign [Rick's petition] on the clipboard, they might want to weigh the prerogatives, as well, of an individual steak-stand owner against - as it says at the top of the page - the collective interests of "the market and fellow merchants, its loyal customers, and the city of Philadelphia."

Bob Libkind aka "rlibkind"

Robert's Market Report

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I was going to say something about Nichols putting the beef on his grill and explaining what's at steak, and how if you read between the lines at the end, it was clear that he put his cheese on one side of the sandwich, but you beat me to it.

Sandy Smith, Exile on Oxford Circle, Philadelphia

"95% of success in life is showing up." --Woody Allen

My foodblogs: 1 | 2 | 3

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Rick Nichols' column in the Inky today, which can be found here, was nearly a "on-the-one-hand-this, on-the-other-hand-that" kinda of piece, until you came to the last paragraph. Parse it closely (not the easiest sentence to understand, and I suspect Rick, who knows how to write a clear, declarative sentence, obfuscated purposely) and you can figure out what he really thinks:
But before they sign [Rick's petition] on the clipboard, they might want to weigh the prerogatives, as well, of an individual steak-stand owner against - as it says at the top of the page - the collective interests of "the market and fellow merchants, its loyal customers, and the city of Philadelphia."

An illogical conclusion (and spot-on wrong) if I have correctly unobfuscated Rick Nichols' closing paragraph.

If Rick Nichols is opining that Rick Olivieri (too many Rick's here) is fighting against the interests of the market, his fellow merchants, the customers and the City of Philadelphia, I'd ask Rick Nichols to detail the thinking that led to such a conclusion. I fail to see how Rick Olivieri trying to save his business of 25 years does any damage to the interests of the market et al.

Edited by Holly Moore (log)

Holly Moore

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Rick Nichols' column in the Inky today, which can be found here, was nearly a "on-the-one-hand-this, on-the-other-hand-that" kinda of piece, until you came to the last paragraph. Parse it closely (not the easiest sentence to understand, and I suspect Rick, who knows how to write a clear, declarative sentence, obfuscated purposely) and you can figure out what he really thinks:
But before they sign [Rick's petition] on the clipboard, they might want to weigh the prerogatives, as well, of an individual steak-stand owner against - as it says at the top of the page - the collective interests of "the market and fellow merchants, its loyal customers, and the city of Philadelphia."

An illogical conclusion (and spot-on wrong) if I have correctly unobfuscated Rick Nichols' closing paragraph.

If Rick Nichols is opining that Rick Olivieri (too many Rick's here) is fighting against the interests of the market, his fellow merchants, the customers and the City of Philadelphia, I'd ask Rick Nichols to detail the thinking that led to such a conclusion. I fail to see how Rick Olivieri trying to save his business of 25 years does any damage to the interests of the market et al.

You call it as you see it, Holly. But one can acknowledge the logic of your conclusion (that keeping Oliveri's business would not harm the market) while still asserting that bringing in someone else might strengthen it. You obviously don't agree with that interpretation, but it has as much logic as the one you posit.

Bob Libkind aka "rlibkind"

Robert's Market Report

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Not that it's breaking news that the merchants are supporting Rick, but the merchants are supporting Rick. The real question is how much support they're offering. Will they out a day in protest? Most unlikely, but I guess we'll wait and see (and I'll link to the entire page, since there's a foie gras story as well):

http://www.readmetro.com/show/en/Philadelphia/20070713/1/2/

http://philly.metro.us/metro/local/article...inal_/9339.html

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Well, there is one possible way out of this standoff:

Management offers Oliveri a new long-term lease on the terms offered to other merchants of his class. He then can sign or refuse.

But there's a problem here, from what I understand. Wasn't Oliveri refusing to share sales figures with the Market management? And aren't the new lease terms based in part on a percentage of sales?

Catch-22, folks. No sales figures, no way to calculate lease payments. No way to calculate lease payments, no basis for offering a lease. The ball's in Oliveri's court. So far, he's chosen to call on the spectators as referees. If my understanding of the situation is correct, he will need to return management's serve if he is to have any chance of staying in business at the RTM.

Sandy Smith, Exile on Oxford Circle, Philadelphia

"95% of success in life is showing up." --Woody Allen

My foodblogs: 1 | 2 | 3

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Rick Nichols' column in the Inky today, which can be found here, was nearly a "on-the-one-hand-this, on-the-other-hand-that" kinda of piece, until you came to the last paragraph. Parse it closely (not the easiest sentence to understand, and I suspect Rick, who knows how to write a clear, declarative sentence, obfuscated purposely) and you can figure out what he really thinks:
But before they sign [Rick's petition] on the clipboard, they might want to weigh the prerogatives, as well, of an individual steak-stand owner against - as it says at the top of the page - the collective interests of "the market and fellow merchants, its loyal customers, and the city of Philadelphia."

An illogical conclusion (and spot-on wrong) if I have correctly unobfuscated Rick Nichols' closing paragraph.

If Rick Nichols is opining that Rick Olivieri (too many Rick's here) is fighting against the interests of the market, his fellow merchants, the customers and the City of Philadelphia, I'd ask Rick Nichols to detail the thinking that led to such a conclusion. I fail to see how Rick Olivieri trying to save his business of 25 years does any damage to the interests of the market et al.

You call it as you see it, Holly. But one can acknowledge the logic of your conclusion (that keeping Oliveri's business would not harm the market) while still asserting that bringing in someone else might strengthen it. You obviously don't agree with that interpretation, but it has as much logic as the one you posit.

How does Rick's ejection, and his being replaced by Tony Luke's, help the market? Will the signs now read, "Reading Terminal Market, Featuring Tony Luke's?" Will the lines at Tony Luke's become longer with customers who would only come to RTM because Tony Lukes is there. Will the new Tony Luke's attracted customers pick up a bunch of beets and a pound of fresh shrimp to take back to their hotel room or office?

What seems logical to me is that most of the incremental customers standing in line at Tony Lukes will be existing RTM lunch users switching from the other lunch merchants - taking away sales from established RTM lunch merchants. The new RTM customers that visit the market to specifically eat at Tony Lukes aren't going to be roaming the aisles for produce and poultry. They are going to eat and run either back to the convention, back to their office, or onward to the Liberty Bell.

Tony Luke's will not raise the RTM's public image. It is already a 5 star tourist attraction. Tony Luke's is not going to significantly benefit the fresh food producers. The new customers Tony Luke's attracts will being going to the RTM specifically to but a cheesesteak.

Only two parties will benefit from the addition of Tony Lukes to the market. Tony Luke who will make a bunch of money and the RTM management who will get rid of a respected, vocal merchant that does not always see eye to eye with them, with the added benefit of instilling a little more fear in those merchants who might oppose one of their actions in the future.

Edited by Holly Moore (log)

Holly Moore

"I eat, therefore I am."

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Well, there is one possible way out of this standoff:

Management offers Oliveri a new long-term lease on the terms offered to other merchants of his class.  He then can sign or refuse.

But there's a problem here, from what I understand.  Wasn't Oliveri refusing to share sales figures with the Market management?  And aren't the new lease terms based in part on a percentage of sales?

Catch-22, folks.  No sales figures, no way to calculate lease payments.  No way to calculate lease payments, no basis for offering a lease. The ball's in Oliveri's court.  So far, he's chosen to call on the spectators as referees.  If my understanding of the situation is correct, he will need to return management's serve if he is to have any chance of staying in business at the RTM.

Are the new leases requiring audited sales information? Has the RTM management imposed percent rentals on renewing merchants? I don't know if that is or is not the case?

Holly Moore

"I eat, therefore I am."

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Are the new leases requiring audited sales information?  Has the RTM management imposed percent rentals on renewing merchants?  I don't know if that is or is not the case?

I am not 100% certain of the following, but I understand that the new leases incorporate three elements, percentage of the sales being one of them and square footage being another -- I forget what the third is.

I don't know whether there is an audit requirement or not, but I wouldn't be surprised at all if the lease contained a provision allowing for one in the event of a dispute.

Audit or not, I am sure that the new lease terms do mean that the restaurants will pay a good bit more than they do now, so it should not be surprising to anyone that they were the most opposed to the new terms. Again, I don't fault Rick for looking out for the interest of his fellow merchants as he best saw fit. But I also understood that, for better or worse, most of the other merchants had come to some form of peace with the new terms. Wincing as they signed the leases? Maybe. But they signed them, which means (if I'm right) that they did provide the data needed to craft them. If I'm right that Oliveri still held out, then he cannot completely blame management for his plight, regardless what one may think of the terms themselves. If I'm wrong, then that does give the critics of this move some ammunition.

Sandy Smith, Exile on Oxford Circle, Philadelphia

"95% of success in life is showing up." --Woody Allen

My foodblogs: 1 | 2 | 3

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The folding of the standoff began with those who had the most to lose and least to gain, the large fresh food purveyors. They were not being asked to shoulder considerably more of the burden in the new lease and didn't want to jeapordize their business. I have to say this comes from someone who has signed the new agreement. He/she also mentioned that the terms of the new lease were not fully disclosed, just the financial burden that would be placed upon that particular tenant. Again, this is from a discussion with a tenant. So when the bigger tenants signed, the bargaining power of the Merchants Ass. went to s--t. So Rick, who lobbied for fair terms and full disclosure, is going to suffer the consequences. Most of the discussions I see here are valid and interesting, however, it is what it seems to be. Removal of a vocal tenant.

So, as a current tenant, would you speak up next time? Probably not.

As a prospective tenant, would you sign with a landlord who will seek to have you removed if they find a more 'popular' version of you?

BTW, I like Tony Lukes and all, but that's it? That is the big plan?? How are we going to get into the RTM at 3:00 AM when Tony Lukes, or myself (I can't quite remember), is in its prime???

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Once again to clarify things, MarketStEl, you are wrong. Rick was refusing to give sales figures, but so were many other merchants. Many of whom have not yet signed their leases. Most, or all of the Amish are yet to sign. They as well refuse to report sales. Futhermore, lease payments are not in any way dependent upon sales figures (at least for the current lease. Whether they will change the rent structure based upon the sales figures in another five years is unknown, management claims this is not to be so). The three elements of rent are as follows: square footage, location, and store type (purveyors, lunch, specialty items, and mixed).

Again, lease terms are based ZERO PERCENT on sales figures. MANY others refused to give numbers, many STILL haven't signed their lease. So in NO WAY was Rick the last man standing.

To continue your analogy, he has never been given a serve. Therefore never had the opportunity to return a serve.

Edited by jtnicolosi (log)
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Once again to clarify things, MarketStEl, you are wrong.  Rick was refusing to give sales figures, but so were many other merchants.  Many of whom have not yet signed their leases.  Most, or all of the Amish are yet to sign.  They as well refuse to report sales.  Futhermore, lease payments are not in any way dependent upon sales figures (at least for the current lease.  Whether they will change the rent structure based upon the sales figures in another five years is unknown, management claims this is not to be so).  The three elements of rent are as follows:  square footage, location, and store type (purveyors, lunch, specialty items, and mixed). 

Again, lease terms are based ZERO PERCENT on sales figures.  MANY others refused to give numbers, many STILL haven't signed their lease.  So in NO WAY was Rick the last man standing. 

To continue your ananalogy, he has never been given a serve.  Therefore never had the opportunity to return a serve.

Game, Set, Match...

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Catch-22, folks. No sales figures, no way to calculate lease payments. No way to calculate lease payments, no basis for offering a lease. The ball's in Oliveri's court. So far, he's chosen to call on the spectators as referees. If my understanding of the situation is correct, he will need to return management's serve if he is to have any chance of staying in business at the RTM.

I dont know if Rick's been given a fair chance Townsend but isnt the core of the issue the fact that market management feels that many lunchtime merchants have undervalued leases not only in the volume of sales they generate but also the fact that more than 90% of those sales are in cash which by conventional wisdom is always under-reported to the IRS, thus asking for accurate sales figures to establish what the busineses can bear in terms of leases (which is legitimate) also creates the possibility that those declared sales figures if they were accurate would cause the market management to increase the rent structure and if inaccurate would create a formal document that would be in direct conflict with official tax returns.

That is the catch 22.

The market can simply hire an actuarial company to figure out an estimate of sales of any merchant in the market simply by observation of volume and the cost of an average sale.

If any merchat challenges the sales estimate, you could simply ask them to prove otherwise.... :unsure:

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