04-06-2025
What do restaurants in Greater Portland do when the competition is right next door?
Jun. 4—Donato Giovine recalls the "shock" he experienced in 2011 after learning that Brunswick-based Gelato Fiasco was opening a new location on Fore Street.
Giovine and his wife, Mariagrazia Zanardi, had opened their own gelateria, Gorgeous Gelato, at 434 Fore St. in late 2010. Gelato Fiasco's new space would be diagonally across the street, a mere cone's throw away.
"At the beginning, we couldn't believe our eyes," he said. "It didn't make any sense, given the amount of gelato customers, to have two places, one so close to the other. It was like suicide — we were splitting a small amount of customers at the time."
Giovine said he could understand two gelato shops located so closely in a major metropolitan city like New York or San Francisco. "But Portland, Maine, with 68,000 people? It was almost funny."
Today, Giovine and Zanardi may not look back and laugh, but they can certainly see the situation with better humor. This city turned out to be big enough for the both of them. Portland's reputation as a foodie destination — bolstered by national publicity starting in the mid-2010s — drew more and more visitors nearly every year. Both shops are currently thriving; since the pandemic, they've been busier than ever.
Local food industry insiders say Portland's volume of visitors makes the notion of business territory almost outdated.
"In the past, another restaurant opening nearby with even a remotely similar menu or style could be seen as an affront, like, 'They're coming for our business,'" said Peter Bissell, co-owner of Low Stakes Lodge, a western-style steakhouse located just up Exchange Street from chef-owner Harding Lee Smith's steakhouse, The Grill Room & Bar. "But Portland for decades now has been a major food destination. It's a small town with a big-city assortment of food and bev. And when you hit that point, there's enough to go around."
"There's too much competition to think that way, to isolate yourself and say, 'We're the only game in town,'" agreed Smith, who also owns The Front Room and The Corner Room. "When I started the Front Room, there were like 85 restaurants in town. There's over 300 now. You have to keep your head down and worry about what you're doing and keep your quality where it needs to be."
CLOSE COMPETITON
The local food and beverage scene has several other examples of neighbors who have been friendly competitors for years, like Saigon restaurant and Thanh Thanh 2 on Forest Avenue, or Coffee By Design on Diamond Street, just around the corner from Tandem Coffee Roasters on Anderson Street. Craft breweries and beverage businesses have clustered together on Industrial Way and in East Bayside, forming drinking districts that seem to benefit all the operations.
"We see lots of cross-pollination that happens, and it's really pretty positive for everybody involved," said Nathan Sanborn, founder of Rising Tide on Fox Street. "It doesn't feel like we're cannibalizing each other so much as supporting."
And in Old Orchard Beach, three pizza stands located within a couple blocks of each other — Bill's, Rocco's and Lisa's — have coexisted peacefully for decades, each attracting its share of the throngs of summer visitors.
"In a touristy area, it may not matter," said Chris Boucher, a marketing professor in the University of New England College of Business. "If there's a line at one place, tourists will go to the next place. There's going to be enough demand that, overall, I think it actually helps all the businesses."
Jason S. Entsminger, assistant professor of Entrepreneurship and Innovation at the Maine Business School, notes that businesses in other sectors often group together, like car dealerships, gas stations and fast food restaurants. Still, some independent food business owners, especially in less tourist-based areas, feel the concept of territory still applies.
"Donuts aren't like car dealerships," said Shelby Omdal, co-owner of Frosty's Donuts in Brunswick, the town's go-to donut shop for 60 years. "Car dealerships can open right next door to each other and they can all be successful. This isn't that type of business, or town."
The Omdals were dismayed to learn in late 2023 that Holy Donut planned to open a Brunswick location less than a mile away from Frosty's, as the gull flies. "It was a bold move on their part," Shelby Omdal said. "We've opened other stores, and I wouldn't go to Wells next to Congdon's and think I'm going to open a shop and be as successful as they are."
Holy Donut launched in Brunswick last May, and the Omdals recently learned that two other donut shops are considering opening in town, including Portland's former HiFi Donuts. "I think maybe people see the lines coming out the door (at Frosty's) most days, and it's easy to say, 'If they can do that, we can too,'" Omdal said.
Entsminger said entrepreneurs may look at a "legacy competitor" like Frosty's and think, "We're going to be offering something that's just different enough that there are going to be people in that market that will want the new thing."
Holy Donut's CEO and co-owner Jeff Buckwalter said his company's customers had been requesting they open a Brunswick store for years, and the location they eventually found — a former Tim Horton's on Pleasant Street just off Interstate 295 — was ideal.
"For us, a lot of tourists coming to Maine are driving right past that location on Route 1 as they head up the coast, and so we also wanted to make sure we could get in front of them," he said. "It's a great location with high traffic. I don't think it's hit its full stride yet, but given the economic climate, it's meeting our expectations."
Meanwhile, Frosty's business is booming. "Our sales have never been so high," said co-owner Nels Omdal, Shelby's husband, noting that the store sold almost 150 dozen donuts in a little over five hours on Mother's Day. "The lines just don't stop."
Entsminger said just as customers are often drawn to a new product in a given market, they can also rally around a legacy brand. "The threat of a new competitor entering a marketplace where there's a really well-established brand can drive customer loyalty."
NOT A ZERO-SUM GAME
Buckwalter said he feels the Brunswick market is big enough to support both Frosty's and Holy Donut. "Provided you can differentiate yourself versus your competition, there's plenty of business to go around," he said.
While Frosty's prides itself on time-tested recipes and light, airy donuts baked fresh within hours of purchase, Holy Donut offers Maine potato donuts in a variety of creative flavors, with plenty of gluten-free and vegan options.
Other owners agreed that distinguishing their businesses from nearby competition is crucial. Giovine and Zanardi are natives of Italy who say Gorgeous Gelato offers an authentic, top-quality gelato experience.
"We have very simple, almost boring flavors — hazelnut, coconut, panna cotta," Giovine said. "When you go into the master gelaterias in Italy, they have 12, 16 flavors, and no more. Our gelato is more traditional, because it has centuries of culture behind it. And it's made using Italian taste buds. When it satisfies our taste buds, it's delicious for others. That may be reductive, but that is the key."
Gelato Fiasco's website includes a "flavor vault" of more than 1,500 flavors they've offered over the years. Gelato Fiasco co-owner Mitch Newlin said Gorgeous Gelato offers baked goods that his store doesn't have, while he feels Gelato Fiasco may have better vegan options.
When Gelato Fiasco was looking to expand in 2012 after five years in business in Brunswick, Newlin said a Portland location "seemed like the next logical step." While they looked at other locations in Old Port, the Fore Street space ticked all the right boxes.
"It was not that we wanted to be right across the street from the competition as much as we wanted to be in the Old Port with outdoor seating and a 1,200- to 1,500-square-foot space," Newlin said.
He believes there's plenty of overlap in the customer bases of the two gelato shops, and that they're not playing a zero-sum game.
"There are a lot of people who will try both of our stores," he said. "They may be here on a three-day weekend. The first day they go to Gorgeous Gelato, the second day they come try us, and they'll compare."
Coffee By Design owner and co-founder Mary Allen Lindemann said there's inherent separation between her business and Tandem. "We have different flavor profiles, we source our coffee differently, we have different histories and different stories to tell," she said.
Like Newlin, she doesn't feel being located nearby a competitor necessarily cuts into each other's business. "If anything, it brings people to the neighborhood," she said. "People will come and check us both out, and we each have our own loyal followings."
Harding noted that the Low Stakes Lodge space had previously hosted another another steakhouse, Timber, for eight years. "I don't think it really affected (The Grill Room) at all," he said. "I've always thought that the more people in the neighborhood the better."
"The only thing that Low Stakes and The Grill Room have in common is that there is a steak section on the menu," said Bissell. "There's a difference in ambience, and the other items on the menu." Smith agreed, pointing out that the Grill Room specializes in wood-grilled steaks and has a "clubby, old-school feel" to it, compared to the more casual, fun vibe at Low Stakes.
"If people crave a steak, and Low Stakes has a wait and they can get into the Grill Room, I'd expect them to do so, and vice-versa," Bissell said. "Having more options isn't necessarily bad for any one business. It just means that more people are coming to town every year, primarily for eating and drinking, and that's a good thing for everybody."
Of course, there's a limit. Boucher, the UNE professor, said if another gelato shop were to open in Old Port, for instance, it might saturate the market, causing one of the three to fail and close. And another donut shop or two opening in Brunswick would further stress-test Frosty's and Holy Donut.
"Competition is always good, because it makes you try harder to do better," said Shelby Omdal. "At the end of the day, if you have a superior product that people can't get anywhere else, you've got the magic."
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