Saturday, June 27, 2015

How to Open a Restaurant

Sandra and Morgan Young opened Main Street Cafe in November 2012. They've previously logged many years in restaurant management for national chains. They believe opening a restaurant isn't rocket science, but is rooted in basic foundational principals. This is their attempt to help others open well.

The Worst Reason to Open a Restaurant

"I love to cook!" or "I'm a foodie; I love food!" These are really bad places to start. If you love to cook, get someone to pay you for cooking. If you're a foodie and love food, be a food blogger, a secret shopper, or give advice to local restaurants. Similarly, if someone said, "I love Indy Cars," and next told you they were going to start a race team, well--yes, you'd laugh all over them.

So What's a Good Reason, Then?

You love the intersection of food and people. A restaurant isn't a food business. It's not a people business; it's both. Oh, and you have to have some tolerance for the risks and tensions of owning your business, because at its core, it is a business. Food + people + business = good recipe for starting a restaurant. The person who said, "Do what you love and you'll never work a day of your life," was probably not a restaurateur ;-)

Bring Great Food

We live in a day and age where OK food won't cut it. There are too many chains that serve good food every day. Mediocre food will not get people out of their home and into your new restaurant. Well, it will the first time, but success is found in repeat visits. Your friends all think your food is amazing. I'd suggest finding some people that know food and don't know you; see what they have to say about your food. It takes consistently great food to make a restaurant go.

Own Customer Service

This is the primary secret weapon that a small start-up restaurant has that most chains don't. If you aren't great at this, your employees won't be either. More is caught than taught; they'll do as you.

There may be no bigger oxymoron in business right now than customer service. At Main Street Cafe we talk about this as part of our culture, not something we do. It's our ethos, not a script. If you don't naturally love people enough to make a difference in their lives when they come in your new restaurant, you may not survive.

Again, people can get great food anywhere these days, and all the chains have advertising budgets that you can't compete with. Treating people amazingly costs the same amount of money as it does to pay your employees to not care about your customers. Creating a culture of great customer service costs you nothing and could be the difference in your success or failure.

This is where the "fun" in owning your own business comes from. It's up to you to create the culture your employees and you want to come to every day. Only you can own and drive this part of your business.

"Treating people amazingly costs the same amount of money as it does to pay your employees to not care about your customers." 

You Need Other Great People

You're amazing, right? Well, you can't do it all and can't be everywhere. And as you'll soon find out, getting this amazing restaurant off the ground is exhausting. If you hire people on their ability to fog a mirror, this won't be much fun. You have to be determined to hire good people. Who's a good person? Someone who likes the culture you're trying to create.

Sometimes we hire people with restaurant experience. Often we hire people with great personalities whom we can teach restaurant skills. If a person can't smile through a ten-minute interview, I guarantee they won't smile fifteen minutes into their shift either.

Don't think good people won't work for restaurant wages. People are happy to come to work in a place that's happy to come to ;-) It's not all about money. Hire well. Train well. Respect them. Laugh with them. Show them how to have fun and love your customers. They'll then enjoy coming to work.

"If a person can't smile through a ten-minute interview, I guarantee they won't smile fifteen minutes into their shift either." 

Do Your Homework

Does your area want to buy what you're passionate about? It's not all about passion. It's about passion + the right market. Know your market because it's the context for everything you'll do in your new restaurant. At Main Street Cafe, our menu is unique yet familiar. Why? Central IN isn't the place to fill a menu with things people haven't heard of.

Have you worked in a restaurant? I hope you've managed one. There are processes and systems for running a restaurant. It's not at all like hosting your successful large dinner parties. It's like running a four ring circus: kitchen, guests, employees, inventory, etc., all at the same time.

Have you talked to people who've opened successful restaurants in your city and transitioned them into lasting success? Get to know them. Learn from them. It's also good to have people you can talk to when it's tough, people who "get it."

Have you done a business plan? Do you know what one is? Most of the people on Shark Tank who can't answer questions well, don't really know what their business plan is. If you think it's a document you're making just because the bank needs it for the loan, you're missing a huge piece of your potential success.

Don't Get in Too Deep Too Fast

For years, Sandra and I watched Mehrdad and Chef Cynthia at Pastariffic slowly grow their business, slowly add on. When we launched our restaurant, we were nervous, but the worse case scenario was we knew we could close up and still pay off our modest loans.
Don't bet the farm if this is your first foray into owning and running a restaurant.

Don't count on making money for a while. People who start taking salaries initially are often paying themselves with borrowed money, very unwise. I've talked with a lot of entrepreneurs and not taking a salary for a year or more is a common tale. If you have to make money on day one, maybe opening up a restaurant isn't for you, yet. (When and how you get paid should be part of your business plan, by the way.)

Learn, Respond, Adapt--be Flexible

As well as you understand your business plan, this isn't an exact science. Be ready to make changes. Be ready to admit that some things you thought would be hits, aren't. Leaders are learners so running a new restaurant is a huge learning experience. Be open to it. Have someone you can trust you bounce ideas off of and people who will tell you the truth.