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Re-model of a lease

post #1 of 10
2/11/06 at 7:03am
Thread Starter 
What is your opinion of investing personal dollars to re-model an existing cafe that is seriously...well...I'm thinking extreme restaurant makeover. The kitchen can be worked around with a few additions but the dining area...

It's just flat out ugly. I can see why it didn't make it trying to serve steak and lobster for $30. Heck, I'm not sure I'd buy a burger there, but the owner, who owns the bar, admittedly doesn't give a hoot about the restaurant other than it being open and revenue coming in and willing to let it lease for cheap.

The lease is very reasonable and the area needs a home cooking venue desperately. It's attached to a bar/casino so I would have the benefits of serving alcoholic bevs without the hassle of a liquor license.

I wouldn't do anything drastic, but it needs new decor, tables and chairs, display cases and a few missing kitchen appliances that I would need. Nothing permanent.

Any thoughts on the subject?

Thanks
April
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post #2 of 10
2/11/06 at 9:36am
Watch restaurant makeover for ideas ;), but it is true that people feel more comfortable dishing out money when the place looks fancy.
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post #3 of 10
2/11/06 at 10:48am
AprilB,
If you have read any of my posts concerning ownership, I'm always pro.
BUT. If my memory serves me correctly, you just finished up at a place,no?
Don't rush. Take a hundred or two dollarsand buy some time with a CPA that focuses on business developement. He or she will give you a punch list and many info gathering tasks. They can help you decide if this is going to be a profitable venture. If you decide "yes!" then don't make a move until you buy some more time with a business attorney.
Just some personal thoughts:
Don't let a low lease fool you. My electric now exceeds my rent.
Make as few leasehold improvements as possible.
Make sure that if you have an agreement with anybody, there is a mutual
way to opt out of the agreement/contract.
Have written ownership on every piece of furniture/equipment you bring to the table and inventoried, signed by both parties.
If this is a sublet, make certain there is a provision to sublet.
Squeeze,pry,pound,slap,poke,etc. to get the owner or landlord to give some sort of finish out, so they have a vested interest.
Pain in the butt, but I would plant myself there for as long as possible just to see what type of trade there is.
I'm probably boring ya. You'll have plenty more questions.
Most important of all is TRY NOT TO USE YOUR MONIES FOR ANYTHING INCLUDING OPERATING EXPENSES!!!!!
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post #4 of 10
2/11/06 at 5:32pm
Thread Starter 

Yes, thanks....

I haven't actually owned a place but I'm at a crossroad as to which direction - restaurant (I would prefer to just own my own place but...) or catering. Each has it's own set of perks and probs so I'm actually exploring deep down what my personality is best suited to do. Pastries are a given, but I also love to cook and create all kinds of food.

I sincerely appreciate the input. Yeah, I'm gathering info and trying to re-invent the years since I was 19 and first thought about owning my own food establishment. A microwave version of a career? LOL.

I agree about the electric. I haven't even opened my bill for the house yet given the way the rates seem to have gone up here.

I also need to meet up with the owner so that I can have a look at the lease agreement and her books for the place to determine what the numbers are. I've spoken with a number of people about what they observed about popularity, but that doesn't tell you anything about the business side of it (oh, gee, I'm telling YOU this? Duh)

Thanks for the additional input as far as who to run the idea by. I have an appointment with the local Small Business Association this coming week to run this idea by him as well.

If not this one, then at least I'm getting ejakated..:bounce:

April
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post #5 of 10
2/11/06 at 6:14pm
it's never too late! I dusted a few years in the bus. before I realized I was a contol freak, especially when it came to my destiny.
SBA long process
see if there is a S.C.O.R.E. group in your area.
PM if you like
pan
I waqsn't sure if you owned but I can remember you being frustrated and bagged it. Just might be the time.
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post #6 of 10
2/11/06 at 10:46pm

Cocktail napkin business plans.

Here is a simple way to assess you lease. The lease should be 3-6% of gross sales. Any more than that seemingly small 6% can slowly kill a small restaurant. If you are able to get a little of the former lessee's financial info on their fixed costs that would help you immensely. Remember that leasehold improvements that involve the building become the property of the landlord. And they are considered an "uncollateralized expense"- meaning they cannot be used as collateral to either get or secure a business loan. So if you put money into improvements that are attached to the building- plumbing, electrical, carpeting etc,. that your lease is long enough for you to get the investment back. Good luck.
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post #7 of 10
2/12/06 at 4:36pm
Thread Starter 

Thank you all so much....

It's all certainly "food for thought" (yak yak)

After many agonizing sleepless nights, or nights that I'd try to sleep and wake up 2 hours later with ideas...thanks to your input I realized I needed to clearly identify my personality type and finally GOT it about 4 this morning.

I don't think a venue that I need to F&B manage is for me. I love to cook and create. I would be endlessly frustrated because I'd have to pick what part of the cooking day/process I would be actively involved with and then dealing with the managerial aspect of having employees and inventory spanning several different types of foodstuffs. I realized my personality just isn't into the instant production of a line cook. I love to create food and have it ready. Like cakes and pies, as compared to slapping a steak on a grill and babysitting it. Yeah, that's fun too but I don't think I could do that on a daily basis. At least at present.

With that in mind it's narrowed to catering and pastry chef/bakery. I know baking and pastries like the back of my hand. The forum on catering is intensely interesting and educational. (I love learning new things)

They don't have either here in what is a rapidly growing bedroom community of Las Vegas. (30k people + at this point-new large businesses coming to the valley, like Lowes and a large theater complex)

I believe I can do both, while emphasizing on one. The artistic side of me always wins out and I think the pastry chef venues are so much more artistically oriented and "catered" to my personality (Oh, I'm just SO FUNNY! pfft) If I were to cater, I'd probably be making little tomato rosettes and stuff...and I believe I can do enough in-home catering to satisfy that urge what with the wedding and prom party season upon us. The only other choice here is caterers out of Vegas and I've studied their menus and price structures. The choices are: Unremarkable or majorly expensive. Neither of which fits the type of people who live here.

Not everyone likes garlic butter snails in mushroom caps, but how many people don't love chocolate?
*grin*

The lease info will certainly serve when I find a place for my storefront.
:bounce:

Anyway, thanks a lot. I'm sure I'll be back at ya with other questions.
April

OH, can you guys help me find links to wholesale bulk food items? I am having NO LUCK with just the basics like good quality flour, cream and the like. Or do you acquire your bulk products from local food chains or? I've been all over the net trying to find suppliers.
Thanks.
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post #8 of 10
2/12/06 at 4:57pm
try the yellow pages....
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post #9 of 10
2/13/06 at 2:18am
AprilB,
I understand exactly how youfeel and came to your conclusion,as I sit in my office at 4 am.:roll:
I would like for you to clear your mind for a while and revisit your idea again in a week or so. Just give it a chance. Talk to anyone here that is doing their own thing and they will tell you they talked themselves out of many oportunities. I respect you enough to not consider your thoughts as excuses. This decision is like skydiving. Sooner or later if it's in your blood your going out the door. and it's perfectly fine to take a couple of rides.
If your strengths are baking and catering and not necessary line, so what.
No one can run a place on theitr own. A low rent with a kitchen seems like a outside catering dream. Think about hiring in a cook/manager to run that part. You would be surprized at the talent of people when you give them some responsibility. anyway think about it/wait!!! don't think about it fora while.
Best of luck to you.
pan
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post #10 of 10
2/14/06 at 12:11pm
Try Sysco Food Company they sell everything fresh and frozen
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