Here’s another data point. I’m watching the HBO documentary “Le Cirque: A Table In Heaven” about Sirio Maccioni and his famous New York restaurant Le Cirque. He also owns several other restaurants under the same name. He is about as successful a restaurateur as you are likely to find. The very first thing he says is that he hates the restaurant business and that his three sons were stupid to follow him into it.
I’ve been both an employee & a multi-time entreprenuer. I have zero experience in the retail or restaurant biz except as a customer & curious observer.
Some thoughts:
As fifty-six says, employee & entreprenuer are two very different mindsets. If the OP’s relatives don’t have the attitude, they will fail, period. Even given $5mil they’ll still fail; it’ll just take longer.
$300K is barely enough to open a hash joint in a corner strip center. Thinking of buying & renovating a building indicates they have done exactly zero actual thinking or actual math towards a business plan.
Somebody upthread recommended the book “The E-Myth Revisited” by Michael Gerber. IMO his first book The E-Myth: Why Most Businesses Don’t Work and What to Do About It) was very very good and is a must-read for these folks.
Also IMO, since then everything Gerber has produced, including the “revisited” book, is derivitive bunk, just restating the same ideas with ever more decoration. He has built a sucessful cult following on his I’m so smart website; Bravo for him, but not useful for the OP’s relatives.
The punch line of all Gerber’s entreprenuer-related books is that if you want to manage a business, start & manage a business. If you really want to perform some task for a living, e.g. cooking, writing software, fixing widgets, then go get a job doing that. Period.
The least important thing an entreprenuer will do is personally create/deliver the core product of the business. If a restaurant owner is cooking, he is almost certainly neglecting the utterly critical stuff that only the owner can do in favor of the stuff (cooking) that a hired cook can do better.
People who get that right usually succeed. Those that don’t almost inevitably fail.
In other words, the worst possible reason to open a restaurant is because you like to cook or to serve.
I would like to point out that in the restaurants that I’ve worked, from upper end to fast food, the chefs were just about the lowest paid. In the mid scale one that I worked, I was the host, and I was making more than the chef. In the upper scale restaurant, the chef was some neanderthal in one case, and I can’t even remember the other. Neither of them were overpaid.
Also, the big sellers were: Pot Roast and cobbler. And these meals were overpriced in the extreme. Point being, cooking good food isn’t even close to what makes the bucks in the restaurant biz, and the chef is the bottom cog in the wheel.
OTOH, somebody has to make the cash in the restaurant biz, and it may as well be your friends, but their plan looks way off the mark.
Were are all of you getting your numbers?
300k is plenty to start a restaurant. It may not be enough to do a major renovation on a 200 year old building but that is a different story That is a separate investment in it self. It may not be enough to do some elaborate thing but it is still plenty to do a fine place that is fully staffed and has all the required elements.
I started a small restaurant with credit cards. And now I have outgrown it in a major way. I do wholesale baking for other restaurants and cafes during the off hours. And will pick up sack lunches for the charter boats this summer. The place is essentially 24 hours operation now. It is constantly packed the only way I can do more business is whole sale and stuff during the off hours In fact this year I will likely cut dinners out so I can do more wholesale stuff. I found that i can do more business with t he doors closed during that time. I will be getting a new place in a year or less. I want about 24-32 tables. Small enough to keep a small crew and be personable. And a large enough kitchen to service other restaurants. Find what works.
I am a convicted felon and a recovering drug addict and alcoholic, high school drop out. I did it with a hard head, lots of creativity, sheare force,being flexible, and listening to mt staff. They are usually smarter than me and have a better idea of what we need to be doing. I take orders form them often. I treat them like that saved my life. I pay more than anyone in town. Even if that means i make nothing. I work over 15 hours a day for over 100 day straight without a day off .It aint easy getting equipment and quantity products up here. I looked around for a building for months til I found one I could afford. Under capitalization is so important. It forces you to use your creativity and brawn. It really didn’t have anything I wanted except a great view. I stuck with it and worked second jobs during the off season. I still will work more so I can afford my upgrades. I am doing this at the end of the road in Alaska. Anyone can do this shit. Amount of money is meaningless.
It is in your head and heart. And many are weaker there than they think. That is the break point.
Do they have that? Those are the traits of independent restaurant owners I know. Not oddles of cash
Yep. There is an Armenian chicken joint nearby me in Glendale that NEVER has any customers. The only vehicle I have ever seen in the parking lot is the owner’s. Been in business ten years. Restaurants make a great front for laundering money.
I have some friends who ran a restaurant in trendy Los Feliz. French style place with pastries etc. They ran it for many years, and it constantly drove them crazy. Flaky waiters, chef who was prone to drink, cheating suppliers, etc. It did not strike me as fun in any way. They finally got sick of it and closed up. They are making more money now renting the space to some other schmucks than they did when they were in operation.
I’m sorry, I have to call shenanigans. Do they go into the pizza oven and test the temp of a meatball on a just-inserted pizza?
Joe
The shenanigans is they didn’t grease the inspector, I suspect. In any case, what are the doing “heating up” chicken?
I dunno… taking it from the fridge, putting it in a warmer? Is this not legal?
Joe
Bless yore darling Heart ! I tried it and failed. Wanna know why? Never try it without family behind you - to the hilt, money and labour. Have a great talent for creative plates - that nobody can do as well. Have fun and be able to ignore the idiots. That is a hard thing to do. (When I had an order for Vichyssoise and the customer didn’t pronounce it correctly, I said we were all out of it.) Not selling to ignoramuses ran me out of business. I’d rather be right than exhausted and rich. I hope for your patience and talent.
Bless yore darling Heart ! I tried it and failed. Wanna know why? Never try it without family behind you - to the hilt, money and labour. Have a great talent for creative plates - that nobody can do as well. Have fun and be able to ignore the idiots. That is a hard thing to do. (When I had an order for Vichyssoise and the customer didn’t pronounce it correctly, I said we were all out of it.) Not selling to ignoramuses ran me out of business. I’d rather be right than exhausted and rich. I hope for your patience and talent.
I agree with most of the comments-running a restaurant is hard work, and everything has to be right. What puzzles me: very expensive places that get away with serving mediocre, expensive food. take Philadelphia’ss (BKBINDERS)-everybody I’ve talked to tells me that the place is very expensive and just not all that good. or Boston-Pr Four; very expensive and mediocre. I also remember the famous (long gone) Chasen’s (Hollywood)-badly cooked and expensive food, but people waited hours to get in-why?
There’s a chapter in Tony Bourdain’s book Kitchen Confidential where he describes just what you’re talking about. Excellent cook and partner chase their lifelong dream to open a restaurant, and then find that just being a good cook is just not enough. He’s seen this failing scenario many, many times and has a lot of words of wisdom for those wanting to enter the restaurant business.
IIRC, his number one rule was: Learn to speak Spanish.
I was going to suggest getting them a copy of Kitchen Confidential, because the book isn’t overtly about how stupid it is for amateurs to open a restaurant, that’s just a little chapter hidden among the rest.
When you give it to them, don’t mention that chapter at all, just say 'Here’s a great book about being a chef, thought you guys would like it." That way, they hopefully won’t be too defensive to read it (spoonful of sugar and all that), and will be sucked in my Bordain’s story enough that they might absorb his warning.
Plus, the book is a great way to vicariously live the chef life so if they do come to their senses, they can still get a little bit of the dream (for a lot cheaper!)
Why are you censoring portions of those names?
Bumping to ask: have they gone through with it?
No. But neither have they abandonned the idea completely.
The aspect that got through to them was the zoning problem. That building was indeed located in a Residential Only area. Joe’s wife knew a woman whose husband had something to do with zoning (different town) and he agreed to talk with them. Apparently they were nearly shellshocked by the end of the conversation, after he laid a lot of horror stories on them on how long it could take to get a zoning change, how much it could cost them just paying for a lawyer to work on it for what might be several years, and no guarantee of a favorable ruling in the end.
Basically they gulped and admitted that the stone building wasn’t going to work. They still wanted to own a restaurant though. Then they found out about a state service, I forget the name, but it’s basically a bunch of retired businessmen who volunteer to act as advisors/mentors to people who want to start small businesses. They got hooked up with a guy that ran a couple of restaurants, and got a whole lot of good advice and warnings. (Listening to them, it sounds like a lot of the things others said in this thread, but of course, coming from an impartial expert ‘outsider’ they listened more.)
In March “Joe” lost his job. (Not his doing, the company he worked for failed.) Which he took as a good omen, and their mentor guy finagled him into a job cooking in one of the restaurants he used to own. Joe is run off his feet, working longer and harder than ever in his life, but so far he seems to love it.
So, who knows? Maybe they will end up running a restaurant eventually, but at least they’ll go into it with a lot better chances than their original pipe dream had.
That sounds awesome. I wish them luck. No one should give up on doing big things or listen to people who say they’re impossible. They just need to line up their cards, get advice, and try earnestly.
Can you find out the name? That is very useful. I wonder if my state has it too.
But have they reconsidered their insistence on starting big?
Not the OP, but he may have been referring to a local chapter of SCORE Association, aka the Service Corps of Retired Executives.