I recently opened a restaurant for an unprepared owner. It was an interesting project, but even a small 40-seat opening is very tough and quite complicated. This owner ran out of money half way through, had no business plan, changed the menu 20 times (literally), and opened too soon because he was "losing money every day." It was ugly. Many things fell through the cracks, some of which are still reverberating months later. Some of my personal concerns were validated, and a few issues were new to me. Looking back over several restaurant experiences here are 10 key points from my primarily kitchen-centric perspective that should be useful to potential owners and managers.
#1. Don't think you are going to open a nice restaurant for $60,000 without doing most of the work yourself. New kitchen? All new plumbing and drains? Grease trap? POS system? Restrooms? Tables, chairs, plates? Paint? Finishes? In San Francisco they say $250-300,000 is the minimum for a smallish project. I don't think it needs to be quite that high if some infrastructure is in place, but know thy numbers. Needless to say, you need plates and utensils before you open. A deep and detailed budget with contingencies is a must. This problem can kick off the whole undercapitalized death cycle before the doors even open.
#2. Have a vision. Take a stand, believe in something. Anything. Whether it is tripe bbq, local swamp foraging or fried chicken, you need to have a core concept on the culinary side and in the front of house. As a chef I can help with that to an extent, but lack of vision or passion from a managing owner will always show through without a strong and expansive central concept. People can taste and sense that hollowness if a core seed concept is missing and it will permeate every facet of the employee culture.
#3. Do the research, i.e have a business plan. To "offer the highest quality food at the cheapest prices possible" is not a business plan, or any plan at all. Do the marketing homework and don't assume you know a new area's predilections because the people look kind of similar or drive familiar cars. Particular markets can be notoriously amorphous and difficult to crack, especially if there is a very similar concept three blocks away. When doing market research also remember that this is a very fickle industry, even with data. Opening magic takes a hell of a lot of hard work before opening. If you are just assuming you have it, you probably don't.
#4. Plan to pay your people fairly. Know current market wages. The California Bay Area has some of the highest wages in the country. The world's talent does not live on minimum wage, unless you have Michelin stars. If it is a minimum wage kitchen, be prepared for that level of execution, or make up the difference in some other way. This is very important in establishing menu pricing based on that key prime cost. Not having any labor numbers in the planning phase is a huge red flag for me and deeply affects my menu writing and ability to guide pricing. Labor is as important as food cost in menu planning.
#5. Business is business. I've dealt with alcoholic owners, the owner sleeping with everyone, the absentee owner, the micromanaging owner, the non-managing owner and everything in between. If you are going to be an active or managing owner, please make well-considered business decisions with your management group - not emotional unilateral menu revisions late at night after a couple slow days. Always maintain conceptual focus and discuss changes with the management group. That central concept is key here and it takes time to prove or disprove it. Pivoting mid-stream is not a trivial matter. See #2. Be brave, not stupid.
#6. An owner should not bring their family in to eat in the middle of a busy Friday night the first week, ordering off menu and walking through the kitchen asking for things we don't have. That will lose massive points with the entire crew and will be grumbled about forever, plus it is unclassy and unprofessional. Once things are running smoothly, then go ahead and feel out that situation.
#7. There are fine lines between hospitality, craving attention, and building business. Sure, as the owner you can and should turn the charm on and work the room. But, be careful how customer complaints and concerns are handled. And do not take all the credit for yourself. Do not blame staff or assign fault - protect your business, not yourself. Be graceful and hear what the customer is saying, but we can't change a menu every time someone wants something. I just worked with an owner who had unilaterally axed all of my vegetarian dishes. When a vegetarian came in and asked why there wasn't anything she could eat the owner said "ask the chef." Obviously a spineless coward, but more importantly a horrible businessman and that customer will never return. It shows the weakness in a missing central concept or vision. If you don't care about vegetarians, wear that on your sleeve and own it. Also, choose who you listen to carefully.
#8. Know thy health code - if you don't, then ask. I know quite a bit of it and still can't keep up with county variations and the inspector wild card factor. Code issues can waste huge amounts of labor, money, and delay the opening. This guy delayed his opening by weeks and costed himself thousands of dollars because he would not ask questions and assumed he new everything. Not sure if the tile needs coving, if custom cabinets need legs, or how to put a kitchen together for a particular menu? Ask. There is nothing embarrassing about asking questions and learning. We should all be doing that. The embarrassment is going terribly over budget and then not paying for things as a result. I asked the floor guy why the tile wasn't being installed to sanitation code - he said he was just doing what he was told by the owner. Ouch. Also, never prepay your workers and then act surprised when they don't show. Bonus - don't just let your purveyor choose all of your equipment before a menu and concept is in place. Key equipment will inevitably be over- and underbuilt then, costing money. #9. I am a cook first and foremost. I want top quality and execution relative to the concept. If the owner says quality is the most important thing and they want to control the food, which they are certainly entitled to do, then they must know food to an extent. From a marketing stand point that means showing me data when I write a menu rather than just claiming "people love these things" and more than ripping off what seems to be successful from competitors at this moment. If an owner thinks frozen fish is fine and we should use the cheapest product but says "quality is the most important thing," major red flags appear. I will do what I can, but expecting me to create a magic sauce to turn junk into gold is, well, just like it sounds. Also, those faulty consumer projections will be proven in the menu sales breakdown, so never make evidence-less assumptions. Menu writing is a living, breathing venture, and very important. Have data for your concept.
#10. We are all in a rush to open, but forcing the opening before servers were fully trained, the POS is fully functional, and the cooks have really worked together is tough. The first few weeks will be rough then. Accept what happens gracefully if you force the opening to save money and don't ask why it is happening if making the conscious choice to open without any service practice or friends and family (enemies and detractors) nights. That money you saved by opening early will hurt you later in bad reviews and customers who never come back.
Needless to say, any restaurant consists of a lot of moving parts, and a lot of decisions that need to be made with conviction and the ability to intermesh. Develop that central core concept and let it inform and animate all other facets of the business. And please have a marketing plan! If a business opens in the woods and no one hears it... Making firm, grounded business decisions that respect quality and the internal work culture is what will get us through the bad days. Everything else is just the spinning of wheels...