The meltdown finally finished off the Melting Pot in Rocklin.

The 3-year-old fondue restaurant on Lonetree Boulevard in Rocklin opens at 4 p.m. today for the last time after more than a year of fighting declining sales and dwindling crowds.

"I've done everything I could. I've looked at all the options," owner Mike Frampton said earlier this week. "But the last two months were just too much."

His restaurant's demise is a window into how recent wild swings on Wall Street and the credit crunch have pinched retailers and restaurants: Nervous customers spend less. Nervous banks lend less.

"My sense is that a lot of businesses are getting squeezed right now," Frampton said.

Consumers are cutting back on meals out. A Nielsen survey earlier this year of 50,000 consumers found that 52 percent are eating out less often.

And more Americans are taking lunch to work, buying food in bulk and stocking up on sale items, reports NPD Group. The Chicago-based restaurant and retail tracking firm said the trend has boosted home freezer sales this year by more than 7 percent.

The $538 billion restaurant industry had a morsel of good news this week, but it came with a caveat. Restaurant visits rose 1 percent for the quarter that ended in August, NPD said – but the modest gain was driven entirely by discounting.

Visits to restaurants that didn't offer deals, many of them higher-end spots, saw visits fall by 1 percent, according to NPD. At the Melting Pot, dinner and drinks for two can cost $90 or more.

"More so than we've seen in many years, consumers are looking for savings and ways to stretch their dollar," NPD analyst Bonnie Riggs said. "Restaurant operators are responding to those economic concerns with value offers and deals."

Meanwhile, lenders battered by the credit crisis have practically shut down business with restaurants, said H.G. Parsa, a restaurant and lodging expert at the University of Central Florida in Orlando.

"Banks are assuming restaurants will do 30 percent less business next year, and it may not be much better in 2010," he said. "This isn't a time for restaurants to grow. It's time to consolidate."

That's what Frampton will do after investing roughly $1 million to open his restaurant in November 2005. The region was booming. In December of that year, the median price of an existing home peaked at about $505,000 in Rocklin's two ZIP codes, according to real estate researcher MDA DataQuick. Last month's median price: $325,000.

The south Placer County restaurant took in about $2 million its first year, roughly equal to Frampton's downtown Sacramento Melting Pot, which will remain open.

Sacramento's sales have held steady, but the Rocklin operation's sales started slumping two years ago. It would have taken in about $1.3 million, a 35 percent slide from the peak, had it stayed open through year's end.

"And that's if we'd been lucky," Frampton said.

As the housing crisis has deepened, other events beyond Frampton's control chipped away at business. Fuel costs over the summer soared to more than $4 per gallon. Food costs snowballed. Regional unemployment rose to levels not seen in more than a decade.

Other nearby retailers and restaurants pulled back or pulled the plug. "For lease" signs festoon storefronts in Lonetree Boulevard's vast shopping centers. A Mervyns across the street from Frampton's restaurant will soon close as the 149-department-store chain liquidates.

Frampton saw much of it coming, "although I didn't realize how bad things would be – I don't think anybody did," he said.

What happened next proves that following the best advice can't fix problems bigger than business itself. Frampton let his landlord, lenders and his franchiser know that business was off and laid out his plan to deal with it.

He advertised more and created contests to keep the Melting Pot visible. He closed earlier and tightened inventory to cut costs. He started a rewards card program and discounts to encourage repeat visits.

And Frampton listened to anyone who would talk to him. He joined an executive group to share ideas with other business leaders. He talked to consultants, friends, family, just about anyone who might have a new idea or a fresh perspective.

But customers stayed away.

"People who used to visit twice a year cut back to once a year," Frampton said. "Often when they did come in, they'd buy less, like cheaper brands of wine, things like that."

He started tracking his sales and expenses daily. Some days the numbers were up. Most days they weren't.

Frampton talked to potential buyers, most thinking that they could wring more money from the business.

"But when they saw the books and how we had already cut expenses, they knew they couldn't do more," he said.

As the news from Wall Street darkened and his business went from limping to life support, Frampton grappled with whether to close the business.

"It's an emotional thing. Some days I think, 'We can make this work,' " he said. "Then I look at my spreadsheet."

It will take a couple of weeks to wrap up closing the site, Frampton said, and some of the Rocklin restaurant's 30 workers will move to the Sacramento Melting Pot for what typically is a busy holiday season.

Call The Bee's Jon Ortiz, (916) 321-1043.