Open a restaurant or no? THAT is the question

My apologies, Ray. No attack was intended & I apologize for the misunderstanding. When I read your posts, it appeared to me you were advising against starting out with a small manageable business with low debt & overhead.

That's what I got when I read the following:

drbbq said:
I don't agree with the "Start small" or the "Grab and go" strategy. You need to do what the customers want, not what you want. IMO people won't take you seriously if you have short hours, no tables, and a limited menu. If I was going to start a business I'd be looking to make a lot of money. You can't do that with a small, carry out only, limited hours joint.
Click to expand...

drbbq said:
I think many want to start small because they really don't know anything about running a restaurant. But IMO if you don't know anything about running a restaurant you shouldn't open one.

All I can tell you is I personally left a lot of blood, sweat, and money on the ground one time trying this but nobody wants to believe it.
Click to expand...

Of course, how one could not interpret the above to mean essentially one is completely clueless when it comes to the food service business if they choose to start small, keep the menu tight & focus on the low overhead of take out - especially when that person is actually running such a business - is beyond me.

Perhaps instead of a series of negative "NOPE DON'T DO IT" posts you could provide some real tangible constructive advice to the original poster in this thread. Share that 35 years of experience & knowledge to help him avoid the pitfalls. Encourage & help someone to start their own successful business - not smack'em down for trying. Way too often threads like this are dominated by negativity like yours. I say it's high time - especially in this economy - we actually try to HELP folks find some way to make a new business work.

I'll work up a post on the things I did to start my small, carry out only, limited menu, limited hours joint. I challenge the Dr. & any other business owner reading this to come up with some positive advice to help MariettaSmoker.

Any takers?
 
HERE! HERE! I'd love to read what you did. I'm not up for a career change at the moment. I love doing what I do but I always love learning something new. Can't wait to read your post. :thumb:

chachahut said:
I'll work up a post on the things I did to start my small, carry out only, limited menu, limited hours joint. I challenge the Dr. & any other business owner reading this to come up with some positive advice to help MariettaSmoker.

Any takers?
Click to expand...
 
chachahut said:
I'll work up a post on the things I did to start my small, carry out only, limited menu, limited hours joint. I challenge the Dr. & any other business owner reading this to come up with some positive advice to help MariettaSmoker.

Any takers?
Click to expand...

Hey Cha cha.. I personally am really looking forward to your thread.. when you get the time. As I know time is limited for you. I really admire what you and your wife have accomplished. It is no small feat, on any size of scale. I personally tip my hat to all the small mom and pops for their drive and doing it their way. For good or bad, America is filled and keeps up with the large restaurant chains. If you were near me, I be visiting your place.. when I am too tired to do my own food that is!

Though don't forget.. there is a good deal of positive advice already in the thread too, a good part being yours :clap2::clap2:

I think Marietta Smoker's thread here has been helpful and appreciated my many people. Thanks MS for the original idea to ask this question!!!
 
chachahut said:
My apologies, Ray. No attack was intended & I apologize for the misunderstanding. When I read your posts, it appeared to me you were advising against starting out with a small manageable business with low debt & overhead.

That's what I got when I read the following:





Of course, how one could not interpret the above to mean essentially one is completely clueless when it comes to the food service business if they choose to start small, keep the menu tight & focus on the low overhead of take out - especially when that person is actually running such a business - is beyond me.

Perhaps instead of a series of negative "NOPE DON'T DO IT" posts you could provide some real tangible constructive advice to the original poster in this thread. Share that 35 years of experience & knowledge to help him avoid the pitfalls. Encourage & help someone to start their own successful business - not smack'em down for trying. Way too often threads like this are dominated by negativity like yours. I say it's high time - especially in this economy - we actually try to HELP folks find some way to make a new business work.

I'll work up a post on the things I did to start my small, carry out only, limited menu, limited hours joint. I challenge the Dr. & any other business owner reading this to come up with some positive advice to help MariettaSmoker.

Any takers?
Click to expand...

My problem is with the quotes around a spun version of what I said.

I don't have time to detail all of this. I'm telling the truth as I know it but once again everybody thinks I did something wrong and it will be different for them. I wish you all lots of luck.

I'll be looking for all the success stories to answer your challenge though.
 
CivilWarBBQ said:
Think about this: a good typical net profit for a restaurant is 10%, NOT including any compensation to the owner. Do the math and you'll get an idea how many meals you'll have to serve to make the income you need to live on. And of course figure on working 12 hours a day, every day.
Click to expand...

Yes backing into the sales you need to do is a smart way of thinking about it.

The restaurant I opened about 15 years ago is still running because the financial structure combined with a conservative estimate on the number of nightly covers was enough to cover the nut and drop a reasonable amount of money to the owner/operator. I said no to 4 or 5 scenarios before going with one.

I'm looking at some other restaurant ideas right now. I like to start with the P&L Proforma where I simply chart out low, medium, peak number of covers and check average the restaurant could reasonably support. Extend and calculate to estimate yearly sales. Apply 10% Net Income.... long look in the mirror:

1. Can I hit those cover/check average numbers?
2. Will the net income cover my financial needs and my debt service?

Strong Yes's and move onto to Cash Flow analysis.

If you are not great with numbers hire a financial consultant to develop a plan. You can operate perfectly but if you have a financial boulder on your back you will fail.
 
One thing that I ensure to tell my clients is "cash is king". I don't care what a P&L looks like if that balance sheet is filled with debt that has to be serviced every month with large amounts of cash then they need to cut cost, slow down spending and get more aggressive at collecting receivables. I know receivables aren't a big part of the restaurant business but cash flow is.

Most people that venture into opening their own businesses aren't "financial" minded people. They have no clue how to read a set of financials. Yet these same people don't think it is important to spend the money for a financial advisor and never figure out before it's too late as to "where did all the money go?"


ique said:
Yes backing into the sales you need to do is a smart way of thinking about it.

The restaurant I opened about 15 years ago is still running because the financial structure combined with a conservative estimate on the number of nightly covers was enough to cover the nut and drop a reasonable amount of money to the owner/operator. I said no to 4 or 5 scenarios before going with one.

I'm looking at some other restaurant ideas right now. I like to start with the P&L Proforma where I simply chart out low, medium, peak number of covers and check average the restaurant could reasonably support. Extend and calculate to estimate yearly sales. Apply 10% Net Income.... long look in the mirror:

1. Can I hit those cover/check average numbers?
2. Will the net income cover my financial needs and my debt service?

Strong Yes's and move onto to Cash Flow analysis.

If you are not great with numbers hire a financial consultant to develop a plan. You can operate perfectly but if you have a financial boulder on your back you will fail.
Click to expand...
 
drbbq said:
I don't have time to detail all of this. I'm telling the truth as I know it but once again everybody thinks I did something wrong and it will be different for them. I wish you all lots of luck.
Click to expand...

No time to detail what went wrong & perhaps teach someone what to avoid, but plenty of time to sling a bit of negativity & dump on people's dreams, eh? Nice - very nice.

drbbq said:
I'll be looking for all the success stories to answer your challenge though.
Click to expand...

Dripping sarcasm duly noted & typical of the tone you've displayed throughout this thread.

Personally I'M hoping to hear from folks with the time to detail why they believe their business failed. One learns much more from failure than from success. Perhaps the "truth as you know it" might help me or anyone else reading this thread from hitting the same issues you did.
 
Bamabuzzard said:
One thing that I ensure to tell my clients is "cash is king". I don't care what a P&L looks like if that balance sheet is filled with debt that has to be serviced every month with large amounts of cash then they need to cut cost, slow down spending and get more aggressive at collecting receivables. I know receivables aren't a big part of the restaurant business but cash flow is.

Most people that venture into opening their own businesses aren't "financial" minded people. They have no clue how to read a set of financials. Yet these same people don't think it is important to spend the money for a financial advisor and never figure out before it's too late as to "where did all the money go?"
Click to expand...

1. The P&L is valuable as a gauge on what the monthly numbers would look like and whether I can cover that balance sheet filled with debt (and the 100 grand I want to pay myself :-D ). As I said the important next step is CASH FLOW

2. I was suggesting to spend money on a financial advisor BEFORE doing a deal, not after.
 
chachahut said:
No time to detail what went wrong & perhaps teach someone what to avoid, but plenty of time to sling a bit of negativity & dump on people's dreams, eh? Nice - very nice.

Dripping sarcasm duly noted & typical of the tone you've displayed throughout this thread.
Click to expand...

Dude slow down a bit perhaps he has no time for detail 'at this point in time'. Don't read so much into things straight away. No one is here to hurt anyone... this place doesn't and never will work like that.

A fair number of things can go away from the original plan in this sort of business and I as one can tell you if I were to sit and run through them all you would either get very board or the forum would time out on me.lol

I am working with very little money, bad weather as normal, bad economy, home made cookers, a busted gazebo,people that think carbonized sausage is BBQ, borrowed tables, and people that smile and lie to your face and those are only a 1/4 of the top crust just wait till I get to the filling. lol
 
I'm not disagreeing with anything you're saying I was giving examples that I see with many of the clients I deal with. They don't understand that gauging cash flow is most important with deciding on whether or not you're going to take out a loan to buy something. I do contract accounting for several small businesses so I'm not there on a day to day basis when they decide to make financia decisions. So I try to educate them as much as I can when it comes time for me to visit them so during the interim they don't go do something that could be fatal to their business.


ique said:
1. The P&L is valuable as a gauge on what the monthly numbers would look like and whether I can cover that balance sheet filled with debt (and the 100 grand I want to pay myself :-D ). As I said the important next step is CASH FLOW

2. I was suggesting to spend money on a financial advisor BEFORE doing a deal, not after.
Click to expand...
 
I think the issue is the obvious sarcastic, condescending tone the good doctor has been using. It doesn't come across as someone wanting to help but rather to tear down. :boink:

Dr_KY said:
Dude slow down a bit perhaps he has no time for detail 'at this point in time'. Don't read so much into things straight away. No one is here to hurt anyone... this place doesn't and never will work like that.

A fair number of things can go away from the original plan in this sort of business and I as one can tell you if I were to sit and run through them all you would either get very board or the forum would time out on me.lol

I am working with very little money, bad weather as normal, bad economy, home made cookers, a busted gazebo,people that think carbonized sausage is BBQ, borrowed tables, and people that smile and lie to your face and those are only a 1/4 of the top crust just wait till I get to the filling. lol
Click to expand...
 
chachahut said:
No time to detail what went wrong & perhaps teach someone what to avoid, but plenty of time to sling a bit of negativity & dump on people's dreams, eh? Nice - very nice.



Dripping sarcasm duly noted & typical of the tone you've displayed throughout this thread.

Personally I'M hoping to hear from folks with the time to detail why they believe their business failed. One learns much more from failure than from success. Perhaps the "truth as you know it" might help me or anyone else reading this thread from hitting the same issues you did.
Click to expand...

I'm trying to let it go man. You should try too.
 
If I can have a shot and a beer while waiting seems like a good thing to me.I say go for it do your home work.
 
Mod Note:

Please keep this civil. if you can't, either refrain from posting or we'll scrub this thread and lock it.

If you need a reminder, please re-read this post...

http://www.bbq-brethren.com/forum/showthread.php?t=81360

Specifically...

NO personal attacks. NO attacks of any kind. Recognizing that everyone has, and is entitled to an opinion, if your opinion comes across as antagonistic, bad karma, insulting or hurtful, keep it to yourself. Any meaningless post that is nothing more than a negative comment of any kind towards a member, or the membership, or is strictly there to antagonize, will be edited or deleted. In other words, you are NOT allowed to be a jerk just to piss people off. Moderators do not have time to be putting out flame wars.
Click to expand...
 
Wow. Miss a couple of days reading and miss lots. OK so I do cook and vend BBQ for a living now. At least I hope I'll break even this year maybe. And that doesn't mean paying the bills at home. But I am turning the corner. It's hard work, there are huge ups and downs but it beats the corporate grind for me.

But if you want to open a restaurant and have never run a small business before and never cooked in a restaurant and never dealt with employees and issues with attendance, etc. then maybe you need to do a lot more research than here.

Step 1 - talk with an accountant you trust. Most everybody has a friend that is in the accounting business. Let them quote you the facts on what it costs, how you lose or break even the first year or 2, how so many go under.

Yes it can be a great life and yes you can make money but believe me you will be in the minority. Just think about all the restaurant buildings in your area that have changed hands or sat vacant for months. I know some that change hands every couple of years and a newby says I can make a go when others can't.
 
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