Some tips on opening a restaurant


October 15, 1990|By Mark Stevens

Have you ever considered opening a restaurant of your own? A cozy bistro with checkered tablecloths. Or a country inn serving fresh-cooked American fare? No matter what kind of place you've dreamed about, you'll want to be aware that restaurants are one of the toughest, diciest businesses you can launch.

"Captured by the romance of owning a restaurant, people often plunk down their money on the naive assumption that there's nothing more to it than opening their doors and serving good food," says John Seidel, president of Business Sales Consultants, a restaurant brokerage and consulting firm based in White Plains, N.Y.

"But it's much more complicated than that," he adds. "All of the elements that figure into running any business -- marketing, sales and finance -- come into play here. Master these skills and you can succeed, but don't let anyone tell you it will be easy."

For starters, you'll have to overcome the common mistake of serving the kind of food the owner prefers rather than the kind of food the local clientele wants to eat. To avoid this blunder, sample the restaurants in your area, making note of which ones are successful, which ones are bombs, and why. This informal survey can prove invaluable in planning the right format for your restaurant.

What else can you do to improve your prospects as a restaurateur? Consider these guidelines:

* Reverse the usual order of things by planning your menu first, then selecting your site. That's the best way to assure that the location you select matches the image you want to create.

All too often, novices do the opposite, acquiring space and then deciding what they want to serve there. Bad sign for the ambience. Ever visit a Chinese restaurant that looked more like a coffee shop? Now you know the reason.

* Get out of the kitchen and into the dining room. Successful restaurateurs will tell you that greeting customers is as important as feeding them. That's why it's so important to put down the apron and mill about, chatting with your guests and thanking them for coming.

"Sometimes this little, but, oh, so powerful gesture, can turn a troubled restaurant around," Mr. Seidel says. "Take the case of two young chefs who went into business together on the basis of their culinary capabilities.

"Yes, they produced wonderful food, but because the menu, the image and the cuisine were confusing to customers, the place failed to build a following. That's when I suggested that one of the owners take up residence in front of the house, mingling with the customers and explaining the restaurant's exotic dishes.

"This turned out to be the missing link, giving the place a warmer, more intimate feeling that's had a positive impact on business."

* Run a lean operation, keeping in mind that the smaller your overhead, the less vulnerable you are to downturns in the business cycle.

To limit costs, consider bypassing the most expensive locations in favor of those that are available at more affordable rents. In many cases, high-profile locations aren't all that necessary. Providing that you have good food, service, price and ambience, people will drive the extra mile to eat at your establishment.

* Avoid the promise of turnkey restaurants housed in graveyard locations.

Because they're fully equipped with a state-of-the-art kitchen and a charming dining room, brokers will claim that those sites have everything you need to get started. That may be true, but a bit of investigation often reveals that these sites are vacant because they've been a deathbed for every new restaurant that's opened its doors there.

Stay away from any location that has been the scene of two or more restaurant failures.

* Explore the option of franchised restaurants. Because they offer a proven method of operation, they can boost the odds of success.

If this approach appeals to you, you're faced with a difficult question: In a market crowded with franchised restaurants, which one should you pick?

"I'd favor those restaurant chains that are among the industry leaders in sales per unit," says Bob Patterson, a Los Angeles-based restaurant consultant with the accounting and consulting firm of Laventhol & Horwath. "This key benchmark is more important than a chain's aggregate sales or profits because it tells prospective franchisees how the individual restaurants perform. That's something they should review before signing on the dotted line."

"There's a great kick, a real high, in serving people," Mr. Seidel says. "Those who enter the business, and who succeed at it, know the feeling is unequaled anywhere else."

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