Do most restaurants fail within a few years in your country/state/locality?

We’ve had some cases locally where a restaurant was ‘sold’, and the employees told that their contracts were now void, their accumulated vacation & sick leave was gone, and they were now going to be paid at new hourly rates (lower, of course). The property owner was similarly informed that his lease with the old owner was void, and that the new owner was only willing to pay a lower rent.

And a bit later, it was found that the ‘new’ owner corporation was controlled by relatives of the original owner.

So the original restaurant did go out of business, but it was more a success than a failure for the owner.

How is it possible for a business owner to stipulate to the property owner that he will only pay a lower rent than the previous tenant? Isn’'t the rate charged up to whoever owns the property? I find it hard to belive that anyone with the balls to suggest such a thing would not be told in no uncertain terms to autofornicate with rusty implements.

It’s called negotiation. And it happens all the time in business deals. Do you pay the manufacturers list price when buying a new car, or do you bargain with the salesman?

In a case like this, the owner can indeed set any rent he wants. And the new tenant can say that’s too high, and just walk away. Leaving the owner with an empty building, and no rent coming in for however long it would take to find a new tenant. Or the owner can decide that a lower rent is better than no rent at all, and accept the rent that the tenant is willing to pay. When the rental market is slow, the tenant may have quite a bit of leverage to get his rent reduced.

I’ve never bought a car, nor any item whose price was negotiable, nor spoken to a salesman, so I can’t really answer your question.

The reason why I asked is because it seems at odds with how there could be so many empty stores, even empty malls in every city where I’ve lived. The rent was too much, so the tenant bailed. That doesn’t sound like any negotiation took place - it was “pay what we’re charging, or get out” - so they did.

Restaurants are the most risky kind of business on earth. You can be very successsfule-but you have to have the righ food, the right location, and keep your costs under control. An individual can do this-but you have to KNOW what you are doing. The corporate chains have a BIG advantage-they have nationwide advertising, and can get volume discounts on food and booze. And another thing: restaurants depend on a LOT of low-wage labor (busboys, waitstaff, asst. cooks, etc.) these people frequently up and quit (most times to get a better job)-so if you own/mamange a restaurant, you will frequently be filling in as a cook or waiter. The well-financed, upper-class restaurants are different-they have a smaller clentele, which spends a lot of money ($100 entrees). If you service that kind of crowd, your chances are much better.