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I poured my blood, sweat and life savings into my restaurant. It ruined my life.

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Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#61

Post by paulie_a »

AmVess wrote: post #13
photoJ wrote: post #4

Running a restaurant is hard and unsurprisingly its even harder if you never have run one before. Staffing, food cost, vender management and health code malarky: these are some of the first things that make or break a restaurant. Then maybe location. Quality of food clearly doesn't make the list, at least not disconnected from price as Dominos, McDonalds and Starbucks succeed with high probability. Sad to see a vanit…

Gordon Ramsay is one of the most experienced and successful restaurateurs ever, and has had numerous failures along the way. Before he became TV famous, he worked in his restaurant every day until 1 AM, and back to it 6 hours later...every day, for many years. People vastly underestimate the time and dedication needed to run a restaurant. If you aren't built for it like Ramsay, you will regret it. For a lot of owners…

I always thought Gordon Ramsey was a douchebag from a cursory glance. But after watching his shows and reading his books, he is pretty awesome. I think he is justified in being annoyed by amateurs asking for help then arguing/ignoring his advice.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#62

Post by QAPereo »

smogcutter wrote: post #19

The first big red flag for me (besides that the whole thing pretty obviously started as a mid life crisis) was how little time it sounds like he spent working at his friend's bar in the three months he needed to put in to qualify for the liquor license. How could he not take that seriously as an opportunity to learn about the industry? I would bet money that the answer is he was afraid to learn that running a restaur…

It didn’t get the same coverage as the more “expose“ aspects of the book, but in Kitchen Confidentiall Anthony Bourdin gets into just what makes a failing restaurant, which is most of them. A particularly illuminating section of the book in my opinion, and one which got into just how difficult it is to run a successful restaurant, and how unprepared most owners are.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#63

Post by Ice_cream_suit »

smogcutter wrote: post #19

The first big red flag for me (besides that the whole thing pretty obviously started as a mid life crisis) was how little time it sounds like he spent working at his friend's bar in the three months he needed to put in to qualify for the liquor license. How could he not take that seriously as an opportunity to learn about the industry? I would bet money that the answer is he was afraid to learn that running a restaur…

Even worse, he took $20,000 from an old friend and burned through it.

And then began borrowing money from family and in-laws.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#64

Post by wolco »

waqf wrote: post #8
briga wrote: post #2

This is really something everyone who opens a restaurant should be prepared for. An overwhelming majority of restaurants go out of business within a few years. It's a really difficult profession to be a part of, and if you want to be successful you've got to make some serious sacrifices--even then that might not be enough.

And yet it sounds as if his restaurant wasn't totally nonviable, he just didn't have nearly enough runway for all his first-time mistakes. He might even be successful next time with what he's learnt, if he had the stomach for another go … and another $200k starting capital …

Please do not encourage him. He lacks the proper budgeting skills. He starts thinking about expanding shuts down the place for a week and then everything falls apart.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#65

Post by crispytx »

acchow wrote: post #3

> We had started with $60,000; after six weeks, we were down to $3,000, and there was still so much to do. I don't think he did nearly enough research into how much it costs to start a restaurant.

Yeah, you can't even open a Subway for $60,000. Opening a restaurant is generally a bad idea, but he obviously underestimated the cost of opening a restaurant.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#66

Post by needcaffeine »

sp332 wrote: post #60
needcaffeine wrote: post #58

Earlier quoted context omitted.

Can you elaborate on why?

To keep employees from walking off with the cash.

Is this really that a factor with 24/7 surveillance and legal repercussions for theft? I mean...you're making it sound like it is, and I believe you but it's just so hard to people employees are that stupid.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#67

Post by jonny_eh »

scarface74 wrote: post #36
photoJ wrote: post #31

Earlier quoted context omitted.

Breakfast prep starts at 6am, maybe 4am if you are baking. In a restaurant lights out might be midnight, later for a bar. Which staff do you trust with free access to the thousands of dollars of liquor, food and property? Do you stay closed for two days a week?

It doesn't help with inventory loss, but these days I think I would try to run a non cash business - credit cards only.

I'd run a virtual restaurant, sell only on Grubhub/Doordash/etc, at least to start with.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#68

Post by toomanybeersies »

saosebastiao wrote: post #57
toomanybeersies wrote: post #41

> At work, I had trouble concentrating on spreadsheets and instead found myself scribbling menus on graph paper Funnily enough, if he wanted to be successful, spreadsheets could've been the key to his success. He would've known his Cost of Goods Sold, he would've known his staffing costs, his rent, and how much money he had and could spend.

I know what you mean, but it’s only part of it. Plenty of restaurants fail despite excellent bookkeeping. Personally I’d posit that the ability to create, measure, and manage operational processes is far more important, because operations are where the (often invisible) opportunity costs wreak havoc on restaurants.

The fact that he managed to run out of money before he even opened shows that he had no idea of the cost involved in opening and running a restaurant. He then reinforces this by telling us that he was selling his food too cheap, so he was running at a loss.

It seems like he actually did have his processes in order in the end, he got to a point where he was running a bit of a profit, and was on track, until he decided to close for a week, which managed to quickly suck his funds dry and plunge him back into debt. This could've been easily avoided.

Obviously that wasn't his only problem, but it's one of many. The fact that the restaurant succeeds today, without him, is interesting, because it sort of proves that he was the failing factor in the restaurant. Often it's external factors that doom a restaurant, poor location for instance.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#69

Post by cbsmith »

retailbuyout wrote: post #47
smogcutter wrote: post #19

The first big red flag for me (besides that the whole thing pretty obviously started as a mid life crisis) was how little time it sounds like he spent working at his friend's bar in the three months he needed to put in to qualify for the liquor license. How could he not take that seriously as an opportunity to learn about the industry? I would bet money that the answer is he was afraid to learn that running a restaur…

Yea, it doesn’t take long working a kitchen or bar to see how fast you can bleed money, employees, reputation—you really have to enjoy the work. You’re going to to into debt, you’re not going to get vacation, you’ll have constant employee turnover and drama (mood issues? Drug issues? Both common in a kitchen.), you have to do shady shit to pass inspection (throw the food out and hit the lights to scare the mice, the…

You won't go into debt if you have enough capitalization.

Of course, you almost never have enough capitalization.

Re: I poured my blood, sweat and life savings into my restaurant. It ruined my life.

#70

Post by retailbuyout »

cbsmith wrote: post #69
retailbuyout wrote: post #47

Earlier quoted context omitted.

Yea, it doesn’t take long working a kitchen or bar to see how fast you can bleed money, employees, reputation—you really have to enjoy the work. You’re going to to into debt, you’re not going to get vacation, you’ll have constant employee turnover and drama (mood issues? Drug issues? Both common in a kitchen.), you have to do shady shit to pass inspection (throw the food out and hit the lights to scare the mice, the…

You won't go into debt if you have enough capitalization. Of course, you almost never have enough capitalization.

Right, i should note that not all the things i’ve seen are smart.... avoiding going into personal debt is fairly straigtforward.

But, I frankly can’t imagine a restaurant business not taking on some debt in some seasons, at least at first.

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