From Forbes: 7 Rules Every Aspiring Restaurateur Should Know

“80% of all new restaurants either close or change hands in the first three years,” says Gary Levy, Hospitality Industry Practice director for consultant firm J.H. Cohn. “The reasons? Lack of money, and ignorance.” If you think you have what it takes to open a restaurant, nail down the capital; then follow these this tips for near-guaranteed success. 

Choose Your Partners Wisely

Consider what skills you bring to the table, then supplement them by bringing in a partner who has experience in areas that you don’t,” advices Yann de Rochefort, owner of the two Boqueria tapas restaurants in New York and the newly opened one in Washington, DC. “I was in marketing and brand development before, and I have an MBA. I knew how to launch a new product and how to project manage, and I have solid accounting and finance skills. What I didn’t know was the specific day-to-day aspects of running a restaurant, of putting a menu together – the operational side,” says de Rochefort who couldn’t have found a better hands-on partner for his Iberian concept when he teamed up with famed chef Seamus Mullen. Mullen had spent two years refining his knowledge of Spanish regional cuisine working in some of Spain’s best restaurants, and now runs his first solo venture, Tertulia. The Spanish gastropub in Manhattan’s West Village was named one of the “Top 10 New Restaurants of 2011” by The New York Times’ Sam Sifton. “We really complemented each other,” he says of his partnership with Mullen. 

Know Your Concept, Know Your Market

“When you set out to create a restaurant it’s not enough to think you want to serve say, Northern Italian cuisine. That’s a menu, not a concept,” explains Dean Small, Founder,Synergy Restaurant Consultants.  You want to identify your brand. Consider everything from your décor, price point, to your vibe, style of your service – small plates, fine dining, family style etc., and even the uniforms your staff will wear. “It’s like baking powder – you don’t see it or taste it, but if it’s not there the cake isn’t going anywhere; it’s flat,” adds Small. To decipher your offering, first seek out your target market, and establish what will best serve the local demographic. “Are you in an area where there are lots of families, or is there a large singles population where lots of people are dating; are you opening up in Manhattan, or in middle America where the average income is $50,000-$60,000?” asks Small. All these questions will impact whether you fill your space with tables for two, or for four or more, and whether you serve family-style in a casual environment or opt for a more formal dinner service in an intimate setting. And don’t forget to make sure that every aspect of your brand is in alignment, counsels Small. “We often get called in when restaurants aren’t doing well, and we quickly realize it’s because there’s a disconnect between the menu and the physical space,” explains Small. “You can’t serve $9 or $10 entrees in a beautiful designed space – that just makes people feel uncomfortable.” Restaurateur Yann de Rochefort, with eateries in New York City and Washington, DC, understands the problem of an incongruous proposition only too well. When he set his first restaurant Suba – a fancy, fine dining Spanish eatery, in a distinctly un-fancy block in Manhattan’s Lower East Side, he hoped the area would quickly gentrify much in the same way as the Meatpacking District. Unfortunately it didn’t. The food was very well received; New York Time’s Frank Bruni gave it two stars, but the neighborhood couldn’t generate enough of the right kind of diner. “There was an inadequacy between the price point, and the concept and the neighborhood that never resolved itself,” concedes de Rochefort who closed Suba after seven years of trying to get it right.

For Best Value Locations Seek Out Opportunity In Unexpected Places

The “best” locations are not always the most obvious choices. Corner lots on streets with high foot traffic, or spaces in the trendiest areas don’t always make commercial sense, especially if the rent is astronomical and you’re a small, high-end restaurant unable to turn over tables quickly. Sometimes you have to unlock value by looking outside the box, advises Yann de Rochefort with his 19th street Boqueria tapas joint in Manhattan’s Flat Iron District in mind. “I spent a lot of time at in the few good restaurants in the neighborhood and saw that they were always busy,” says de Rochfort. “I realized that it was an underserved area and it would make good business sense to set up there. Then we built up a reputation for the restaurant and people came to us.” It wasn’t long before he opened a second, larger location in SoHo. Taking a risk on an unlikely site also worked out for John Currence, 2009 James Beard Best Southern Chef. The restaurateur at the helm of The City Grocery Group which owns four eateries in Oxford, Mississippi built his popular brasserie, Snack Bar, in a strip mall, despite initial misgivings. “I swore I would never own anything in a strip mall just because I was snotty! Then this property came available; it was so cheap and it was right next door to our breakfast joint, Big Dad Breakfast, which meant that we could share facilities,” explains Currence. Still, the challenge was to make diners feel as if they were somewhere fancier, and so Currence turned to something he learnt in his psychology class in college. “I used a distraction technique where we make diners take two turns after they’ve walked through the door before the dining room reveals itself. Just a few steps around those corners makes them feel as if they are totally removed from the mall.”   

Don’t Be Seduced By Aesthetics: Make Sure Everything Serves Its Purpose

“You need to pay attention to everything right down to the salt and pepper shakers. If it’s there, it can’t just look good, it has to work” advises hospitality consultant Gary Levy. This means not opting for too large plates that overcrowd diners when you have smaller tables or your concept is sharing plates; choosing flatware that’s comfortable to hold with smooth, rounded edges, and that don’t feel too light and flimsy, ensuring your napkins are of good quality and don’t leave your guests covered in lint; and deciding against oversized Martini glasses that are destined to slosh the contents over the table. To illustrate his point Levy recounts a story of a famous French chef he once worked with in New York on the opening of a new restaurant. “He refused to open until the imported French silverware he’d ordered specifically had arrived,” says Levy. “As I was representing the capital and we were paying rent without getting any revenue, I was pushing the chef to open. Finally he acquiesced using alternative silverware. When the restaurant got reviewed a very influential critic pointed out that the cutlery was all wrong for the concept, and that it kept falling off the plates. After he read this, the chef looked straight at me and said, I told you so.” 

Never Stop Asking Questions

If you’ve never built a restaurant before, it’s vital to surround yourself with an experienced team of architects, contractors and project managers. “These people have already made all the mistakes and have the experience to avoid those same pitfalls,” explains hospitality consultant Gary Levy. Hiring the best however, doesn’t mean hiring the most expensive, says restaurateur Alison Price Becker. “You want someone with great recommendations, and a great track record, and above all someone who will talk to you. You really need someone who communicates well,” she says. Still, it’s easy to get railroaded into making decisions – often bad decisions, or into compromising on your vision. Whenever a change is made, or something isn’t happening how you want it to happen, or simply to understand what’s going on at any given moment; ask questions – ask as many of them as you need. “When I was building my first restaurant, I would go in every day and constantly ask questions. The builders got so annoyed with me they removed the toilets and didn’t put them back in hoping that would keep me out. I had to use the restroom in the garage across the street with a door that barely opened, and posters of naked ladies on the walls, but I didn’t care, I still went in,” says Price Becker. Then, if you really believe something is awry, don’t be afraid to step in and assert your authority. “There were times when I just had to dig in my heels and say, no, we need this to be like this, or, no I absolutely need this extra storage space,” says Price Becker, speaking of her recently opened Manhattan eatery, Alison 18. “Even though my partner was a builder, he had no idea how much space things like paper towels take up – all those things you never see as a customer need to go somewhere!”

Be Prudent About Payback – For Investors and Yourself

“Never take money from anyone whose life could change if they didn’t get it back, and be prepared to take nothing for yourself for a while,” advises restaurant consultant Clark Wolf. Of course, this isn’t to say restaurants can’t provide a good return but expect to wait a while before you and your investors reap the rewards of your hard work. “Restaurants are for long term, slow money back investors – investors that more Warren Buffet-y,” says Wolf. Your first priority is to establish the restaurant and plug any profits back into. Restaurateurs eager to prove their projects are a success are often overly ambitious and start compensating their investors prematurely. “Structure payback in a way that best protects the business,” says Wolf. Typically the payback period for a restaurant investment is three to five years. And don’t use assume that a firm handshake between friends is good enough when establishing terms of an investment. “Engage lawyers and accountants at the outset. Take as much time as you may spend thinking about your concept and your design to establish how you’re going to compensate your yourself, and what happens after you’ve paid back your investors,” advises restaurant consultant Gary Levy. “If you hit the gland slam and your restaurant is fabulous make sure you have the freedom to go off on your own, or to invite your initial investors to go with you. I can’t tell how many times people open restaurant on handshakes without the right legal documents, and it becomes very problematic and distracting down the road.   

Opt For Timeless Décor Over On-Trend Design

Don’t get railroaded into thinking your eatery has to reflect cutting-edge fashion to be successful. On the contrary, this sets a time bomb ticking. As soon as the latest fads you’ve opted to put up on your walls have had their day, your restaurant will be relegated to the has-been pile. “To me, the mark of quality design is something that will stand the test of time,” says John Currence, chef and restaurateur in Oxford, MS. “It’s easy not to be Mr. Right, but Mr. Right Now.” Keep diners coming back by going for a classic, timeless look with a few on trend touches that can be easily updated when the time comes. Currence followed this precept with his restaurant City Grocery. Exposed brick walls, heart pine plank floors, and linen tablecloths lined with white butcher paper convey a classic American bistro feel. “ We have a line of elegant but very distinctive light fixtures running down the center of the restaurant – those are the only things we might have to update over the next 50 years, that and maybe we’ll replace the chairs.” As a consequence of overuse, of course. 


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