Young (prospective) restaurateur seeking advice on plan

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twinsfan
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2013/12/29 22:52:26 (permalink)

Young (prospective) restaurateur seeking advice on plan

Hi y'all,
 
I'm a seventeen year old chef- yes, seventeen, who's been working professionally around food for five or six years. I had the opportunity to start out on the professional barbecue circuit when I was twelve, and work as a caterer for three years. Recently, I've been working around so-called "molecular gastronomy" and other forms of nouveau Southern cuisine. 
 
Now, I understand this is a ridiculous pipe dream, but I've entered preliminary discussions around opening a very small (12-24 seat) restaurant on a shoestring budget. I understand limited funding is a terrible idea in the restaurant industry, but the cache would be that it would only remain open for nine months before I head off to college. This would be a venue for working with the modest modern techniques and preparations in a low risk situation. I've catered, worked in professional kitchens, and staged multiple times, and although I have little experience, I'd like to try it.
 
Considering I'm aiming for a 1000 sq ft restaurant with 20-24 seats, I have determined the project is possible for anywhere between $12-20k.  This would include rent, insurance, utilities, tables/chairs, plateware/glassware, maintenance equipment, etc. Is this worth pursuing if I can fund raise through crowd-funding?
 
 
 
 
#1

24 Replies Related Threads

    nightmarejr
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/30 00:46:56 (permalink)
    Have you considered a food truck instead? That budget is really small for what you want to do and on top of that the time it would take to do certain construction things if needed. 
    #2
    Foodbme
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/30 01:18:18 (permalink)
    nightmarejr
    Have you considered a food truck instead? That budget is really small for what you want to do and on top of that the time it would take to do certain construction things if needed. 

    Food trucks cost more than his budget and don't lend themselves to his type of cooking methods.
    #3
    twinsfan
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/30 10:08:41 (permalink)
    The whole idea would be to rent an existing restaurant space that would only need a coat of paint, decor, etc. Two weeks or less. 
     
    The basic plan was three months of rent at $1500-2000, $2,000 worth of tables and chairs, $2,000 worth of plateware, $1,000 worth of decor, extra for maintenance and utilities. I've decided against restaurant insurance if the landlord would be OK with it. Nothing really to lose.  This would be around $11-15k. Cheaper than a food truck + commissary. 
     
    I've looked at several locations in Nashville, Charleston, Charlotte, and smaller cities in NC. 
    post edited by twinsfan - 2013/12/30 10:11:21
    #4
    Midnights
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/30 11:42:58 (permalink)
    What is the timeline and cost for all of the licenses and such that you'll need? It seems like a lot of red tape to cut through for such a short window for your planned period of operations.
    #5
    chefbuba
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/30 11:45:10 (permalink)
    twinsfan

    Hi y'all,

    I'm a seventeen year old chef- yes, seventeen, who's been working professionally around food for five or six years. I had the opportunity to start out on the professional barbecue circuit when I was twelve, and work as a caterer for three years. Recently, I've been working around so-called "molecular gastronomy" and other forms of nouveau Southern cuisine. 

    Now, I understand this is a ridiculous pipe dream, but I've entered preliminary discussions around opening a very small (12-24 seat) restaurant on a shoestring budget. I understand limited funding is a terrible idea in the restaurant industry, but the cache would be that it would only remain open for nine months before I head off to college. This would be a venue for working with the modest modern techniques and preparations in a low risk situation. I've catered, worked in professional kitchens, and staged multiple times, and although I have little experience, I'd like to try it.

    Considering I'm aiming for a 1000 sq ft restaurant with 20-24 seats, I have determined the project is possible for anywhere between $12-20k.  This would include rent, insurance, utilities, tables/chairs, plateware/glassware, maintenance equipment, etc. Is this worth pursuing if I can fund raise through crowd-funding?





    As you stated, this is a ridiculous pipe dream and you have little experience.
    You want to use crowd funding (other peoples money) that you don't have to pay back.
    How many restaurants have you run? What makes you  think that you have the experience to pull off something like this?
    You are not even old enough to enter into a legally binding contract.
    No building owner would ever lease/rent to a tenant without being listed as an additional insured. What happens when you burn the place down, or someone slips in the dining room?
    What about employees? Got to have workers comp.
    I applaud you for dreaming, but save the other peoples money and pursue a real job in a high end restaurant for nine months until you go to college.
    #6
    twinsfan
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/30 15:59:04 (permalink)
    I understand it's crazy, but it has never been done before. I would be eighteen by next summer. I've run a catering company for three years, dozens of events. I've also done some popup-type events. I worked this summer as a prep cook and work in our schools dining hall. And I've staged at a few restaurants for a night.

    The issue is I can't get a significant job at a good restaurant, otherwise I wouldn't be considering this.

    I understand I don't have a lot of experience but I have more than some restaurant owners (in it for the long haul).

    I've researched licensing but it's difficult to plan until I have a specific location and a possible spot.

    I appreciate all advice!

    #7
    bartl
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/31 01:46:27 (permalink)
    chefbuba
    You are not even old enough to enter into a legally binding contract.

    And we have a dealbreaker!!!
    #8
    Foodbme
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/31 03:48:38 (permalink)
    You obviously sound like a pretty bright, ambitious, street smart kid with experience beyond your years BUT------ you're not in a very good position to start up a place YET.
    I can tell by your comments that you don't have a realistic grasp of the financial aspects of starting up a business nor the amount of money it REALISTICALLY requires.
    I'm sure you will be someday but you're not ready yet.
    Find a good Resume Writer who specializes in the Restaurant Industry and put together a Killer Resume and apply to the top restaurants in the food areas that you want to eventually operate in.
    http://greatresumeexample.com/restaurant-server-resume/restaurant-resume-tips/
    Get some more experience in ALL phases of the business.
    Take some on-line courses in business finance and accounting. 
    Also some courses in Entrepreneurship.
    Find someone in the industry who see's your promise and will become your Mentor.
    MENTORS ARE VERY IMPORTANT!
    Build your experience, save your money, learn every basic financial aspect of running a business and then do your thing.
    post edited by Foodbme - 2013/12/31 03:55:16
    #9
    twinsfan
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/31 08:27:50 (permalink)
    *I will be eighteen by the time I would open. Just clearing that up*
     
    Thank you! That sounds like a good plan. Just worried there aren't many options with my age.
     
    The financials would be difficult with my model. With my pricing model, I would bring in $30.4k if every service was full, $24.2k at 80%, and $15.1k at half full services. This is all without non-alcoholic beverages, not sure about that revenue.
     
    Somewhere around 60-65% is probably my break even, although I'm sure there are unknown costs that would raise that number. 
     
    I'm friends with a lot of food bloggers in these circles, and molecular gastronomy restaurants typically  have more issues reducing costs than filling seats. 
    post edited by twinsfan - 2013/12/31 08:30:55
    #10
    Midnights
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/31 13:14:50 (permalink)
    The break even point isn't just a percentage of capacity. It often takes years to cover the start-up costs. When doing something where your funding is based on other people giving you money, you have to think about what they will get out from the money they give you. It's a difficult time to get people to part with their hard-earned cash. Knowing going in that you plan on closing your doors nine months after you open will likely make it even more difficult.
    #11
    WarToad
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    Re:Young (prospective) restaurateur seeking advice on plan 2013/12/31 15:38:32 (permalink)
    Have you considered a "pop up" type of venture?  Would greatly lower your operating cost.    You could also pref for just a Friday/Saturday service and let yourself really focus.  Be a much softer start.  Less risk.
     
    And since you're doing this for experience, really focus on the finances.  You can have top notch cooking skills, but if you can't turn a profit because you can't manage costs and price appropriately, you'll always be working for someone else.
     
    Good luck Twinsfan.  You seem to have a solid work ethic and big vision.  Keep that fire burning.
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    fishscale28
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/01 14:12:00 (permalink)
    Keep the fire burning and save save save for the next few years. You'll probably fine tune your concept and goals in the next few years and will easily be able to work yourself into something successful. It takes time, lots of experience and lots more money-stuff that you don't exactly have at your disposal. Give it some time and grow into your goals.
    #13
    JayL
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/02 21:55:18 (permalink)
    35-40% profit?  Hell I want some of that!
    #14
    tmiles
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/03 15:20:52 (permalink)
    I'm not a restaurant guy, so I hoped that one elsewould post. Pop-up came close, but I'm surprised that nobody has mentioned the "rent a restaurant" concept. You will not find one in all cities (I wish we had one in Worcester), but it is a turn-key way to try your idea for a few nights. The owner has everything in place (and often keeps liquor sales), he/she has an existing agreement with the credit cards, a wait staff, and can help with promotion. You may have to sleep in your car, but I understand that you can test a concept for under $2000.
    #15
    JayL
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/03 21:25:07 (permalink)
    Just to let the young one know...not many concepts will profit you 40% of sales. 
     
    Play it safe and base your numbers on 10-15% profit...unless you plan on insane pricing & the patrons are willing to spend the money.
    post edited by JayL - 2014/01/03 21:27:06
    #16
    fishscale28
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/04 01:46:19 (permalink)
    10-15% if he's lucky!  Industry average/standards is 7%...of course many are much better and some a little worse but 40% is one of those too good to be true kinda deals.
    #17
    JayL
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/04 11:46:14 (permalink)
    Fishscale is absolutely right, in my opinion.  One of my places, one that I consider fairly successful, averaged around 6.5% profit based on total sales. 
     
    A couple friends of mine that are WILDLY successful profit around 8.5%...this is from my own estimation of their personal take (drawing from personal conversations)...I know what their net sales are.
     
    I have had one concept that profited almost 15%, but that isn't the norm from my experience. 
     
    To think a new place will profit 35-40% is insane. 
    post edited by JayL - 2014/01/04 11:49:14
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    fishscale28
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/04 14:37:47 (permalink)
    Mucho insano!!!  But if he can do it I want in on it...
    #19
    twinsfan
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/07 17:22:17 (permalink)
    Sorry for the delay,
     
    Don't think I ever said 40% profit! Haha. If I was to scale up from that 60-70% break even point there would be extra food costs, etc. 
     
    It's very difficult to price out, as molecular gastronomy can run into the hundreds per person. Certainly I can't charge that without being a well known chef, but I I have been working with the top food labs and restaurants in the country and can generate a decent buzz with my age. My concept would be around seven plates/courses in the $50-60 range, BYO (obviously). That is scary expensive but a lot of similarly unknown chefs have succeeded above that price.
     
    As one poster said, I've explored the rent-a-restaurant idea in the form of a tour. Someone who's been in the industry for a few decades recommended I don't tie myself to a brick and mortar shop this young. Instead, he said to bring my creativity (and recklessness) to 15-20 cities, one or two nights in each city, as a pop-up. I could travel the Southeast from Philly to Austin in two months and need only $5-6k (vs $15k or more) Thoughts on this idea?
    post edited by twinsfan - 2014/01/07 20:45:55
    #20
    JayL
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/07 21:42:15 (permalink)
    I'm confused over your definition of "break even".  To me, anything above my break even is profit.  What do you consider profit?
    #21
    chefbuba
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/07 23:08:13 (permalink)
    It's all profit to him, he has no skin in the game. $$ is said to be coming from crowd funding, others (mostly strangers) just giving money in small denominations with no expectation of anything in return. Check out kick starter.
    I wish I could have started the businesses that I owned with free money, I wouldn't have cared if the business folded or not.
    Put up a few hundred thousand of your own hard earned money to open a temporary three peanuts on a plate place or present your idea to a banker, you would get a size 13 boot in your ass faster than you could say molecular gastronomy.
    #22
    fishscale28
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/09 20:01:42 (permalink)
    I admire your hunger but reality is you still need to have somewhat of a name for yourself in order for anyone to let you "rent" their restaurant.  And in addition you're going to need to have a way to draw in a crowd.  Some of the better chef's who do the passing fad of M.G. have built their entire reputation on that...something you can't get without paying the dues.  
     
    And then pay very close attention to where the trend of M.G. currently is...
     
    Kickstarter is great for stuff like this but you also have to convince hoards of people of your ideas and goals.  Again I admire your hunger but you have a long way to go before your able to make any of this happen.  Not being negative but sometimes reality is a hard pill to swallow..................
     
    But I have been wrong before...
    #23
    johnnyv
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/28 16:43:20 (permalink)

    If I may put my 2 cents in based upon my own personal experience…
     
    First, I love your enthususiam and ambition to “strike out” out on your own. That’s great --- but you have to temper that with the R.E.A.L. (reality + enthusiasm + ambition + Long-term) of this business. Good for you to reach-out and get some sound advice in your young life to avoid the potential failures later.   


    As for "molecular gastronomy". It’s a relatively new trend and fad- we all know about what happens to trends/fads – they will come and so they will go…solid principles and skills will go a lot further in your career.  Additionally, your patrons aren’t going to understand it so essentially they won’t really care.
     
    My chef friends and I were recently discussing this same topic and how some of the same curriculum at CIA has changed from the essential basics that we learned back in the old’ days – We’ve become somewhat disappointed with this shift of focus of the Gastronomy Sciences segment. It appears many of the culinary schools are getting away from some of the most crucial sustainable elements in being a good chef. We concluded we think maybe they are “reinventing” themselves to mirror the over glamorization of food and cooking to keep in-line with the media and TV. As some of the trustees, founders have passed - so shall the torch…
     
    “…According to the National Restaurant Association 30% of new restaurants fail in the first year, and of those that survive, another 30% close in the next 2 years.  Sure that is significant but according to the Small Business Administration’s Office Of Advocacy the two-year failure rate for all small businesses is 31%, and after five years the rate increases to 49%...”
     
    Even if you can get an “outside funding” source, with literally “no-skin” in the game, you’ll be limited on investors.  
     
    Additionally. you can never pay these type of investors back quick enough –Many investors see you bring in money and customers, and generally don’t have a clue about the overhead and just the necessary expenditures in running an establishment  - I don’t think you want Joey Meathead to use your expensive chef knives as digit removers.  
     
    I’m here to reiterate the fact that everyone is correct – the food and hospitality business is one of the most challenging and demanding businesses in the world. You not only have excellent cooking abilities, but strong business skills as well, plus the many intangible skills that you will only learn with more experience.   You have to crawl before you can walk.
     
    Kickstarter is an excellent resource, but targeted to less then 10K on a venture like yours. Unless you have a killer story to tell, or concept that is captivating, it’s still going to be a very, very tough sell.   
     
    Generally, Restaurateur’s are completely insane, have failed personal relationships, alcoholics/addicts or god willing got sober…LOL
     
    I spent over 60K to attend culinary school in hopes of the bright lights in the big city. Let me tell you, I’ve worked in some real S*** holes that were charging some ungodly rate of $65.00 per plate for something you would be likely find in the gutter in Bangladesh somewhere and paying me $9.oo and hour to prepare these crap dishes.
     
    My recommendation is go to culinary school and learn all you can, enter competitions, be a superstar, come-out hungry and work in getting an internship for a top chef. Take it from experience, It’s not going to be easy and they will work you very hard and push you till you break.
     
    By the time your 25, with the proper goals and achievements, you will have great credentials, and obtained credibility possibly enough to have someone hand you the keys and let you have your culinary sandbox.
     
    I don’t want to burst your bubble, and please never give up on your dream - and who knows - maybe you can prove us all wrong!
     
    I genuinely wish you much success in your endeavor !  

    #24
    Sonny Funzio
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    Re:Young (prospective) restaurateur seeking advice on plan 2014/01/29 12:12:41 (permalink)
    twinsfan ... What you're looking for is known as "small, fat and happy".
     
    Yes, you should take the risk ... but only as a calculated risk.  The operative word here being "calculated".
     
    Remember the old adage: "it is not the thought of what we've done that drives us mad; but what we could have, but hadn't". 
    Do it ... the experience will be completely invaluable.  Just as in retail finance where they tell you that because you're young you'll have time on your side and if you suffer a loss when you are young you'll have time to make it up ... similarly, if things don't work out you'll have time to recover AND you'll have lessons and experience that will significantly help to improve the odds of future success.
     
    Here are some of my older posts regarding restaurant planning & financials. 
    Particularly because it sounds like the plans you are considering have a fairly narrow scope and your restaurant would rely upon a specialty which has a limited target market audience, and you are not considering serving alcohol which tends to provide some padding to the margins in your business ... it is even more important to understand what it takes to run a tight ship and understand how things impact your bottom line.
     
    While in those posts (below) I am sometimes repeating similar advice, and sometimes the posts reference each other ... the points made are pertinent to the plans you have discussed even though they are of a general nature.
    Avoid skipping part of a post because it seems to have been covered in another one ... read them completely for the best understanding.

    You'll need to scroll down the pages to find my specific posts in each thread  AND note that some of these pages/threads have more than one post by me ... you'll need to scroll go find each of them at each of the links.
     
    In no particular order ...
    http://www.roadfood.com/Forums/m188473-print.aspx
    http://www.roadfood.com/Forums/m451000-print.aspx
    http://www.roadfood.com/Forums/m321184-print.aspx
    http://www.roadfood.com/Forums/m737443-print.aspx
    http://www.roadfood.com/Forums/m562218-print.aspx
    http://www.roadfood.com/Forums/m561187-print.aspx
    http://www.roadfood.com/Forums/m267138-print.aspx
    http://www.roadfood.com/F...me-advice-m244337.aspx
    http://www.roadfood.com/Forums/m350012-print.aspx
    Good Luck!
     
     
     
     
    post edited by Sonny Funzio - 2014/01/29 18:06:15
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