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opening a new restaurant

post #1 of 7
11/2/09 at 12:22pm
Thread Starter 
O.K. so im not sure if this is the right place for this, but ive been thinking about opening a place of my own, i started looking at restaurants for sale online. Most look kinda rundown, and looks like they are for sale for a reason. So, my I started to think about starting a place from scratch. My question is to anyone who has done either of these, would it be more cost effecient to start a place from scratch or buy something that already has inventory, employees, etc. and try to make that work? kindof a vauge question, but im just brainstorming right now. thank you
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post #2 of 7
11/2/09 at 12:52pm
I've never done it. But surely the deciding factor is money.

So long as the place isnt too run down and needing mega bucks spent to bring it up to standard and your requirements, it must surely be cheaper than fitting out a complete kitchenwith plumbing, sewage, ventillation etc.

Also, there may be a very good reason the building has never been used for catering.
Perhaps there is a no smell clause written into the lease. So you have to spend a fortune making sure the neighbourhood doesn't smell of your lovely produce.

What kind of place are you wanting to open? Any Sushi on the menu by any chance?

Good luck. You'll probarbly be getting lots of practical help here.
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post #3 of 7
11/2/09 at 1:59pm
Get someone familiar with the business to look at it. You do not want former employees, nor the same mentality or operating concept, that's why it closed. Either way you need self generated cash and a lot of it as banks wont give you for a restaurant, now more then any other time due to economy. In any event GOOD LUCK.:crazy::chef:
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post #4 of 7
11/2/09 at 5:35pm
Be careful it's not a restaurant "dead zone". Sometimes there are spots that have had mulitiple restaurant startups in them only for every last one of them to fail. Sometimes there is no rhyme or reason to it...they might even appear to have everything going for them but still can't make a go of it. Research thoroughly...if nothing has been successful in that particular location....there's a reason why...and it usually isn't because people want something different from what has been offered to them.

If it looks too good to be true...it probably is.

Best of luck to you!
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post #5 of 7
11/2/09 at 10:09pm
Usually, it's cheaper to buy a fully functioning restaurant--complete with all permits and inspections.

Depending on the area and municipality you live in, it can either be next to imposible or very easy to get a liquor license or occupancy permit. You need to check with City Hall on what is required.

The cost of infrastructure--electrical, plumbing, heating/A/C can also be enormous, but the biggest single ticket items is the ventilaton system (ie, hood). Once it's installed, it's installed, better someone else to pay for this than you..... Furniture, smallwares, other equipment can be easily gotten, but infrastructure is a big cost.

Every place is different and unique, you have to check them out.

And then there's parking...................
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post #6 of 7
11/3/09 at 1:42am
It would all depend on the place. Several things to consider. Why is the place closed? (If you can locate suppliers that called on the place, they will know). It could be the wrong type of place for the location (fine dining in a blue collar neighborhood), inexperienced people who "just always wanted to own a restaurant", or maybe the owner just wanted to retire. Or something as simple as they just had bad food. As mentioned earlier, if the place has gone from owner to owner and never made it, then there's something inherently wrong that you want no part of. If it's a place that was successful for many years, changed hands and then folded, it was probably a mismanagement problem unless something in the area changed drastically. An example for that being a place that had great business because of another nearby business such as a factory that then closed or had heavy layoffs. Research the history of any place you consider and then decide if it closed for reasons that could be overcome. I see a lot of places that are closed because the owners lived beyond their means and their personal debt was tied to the business and brought it down. That's the kind of problem you can overcome. It would be less expensive to buy an existing place over trying to start from scratch.
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post #7 of 7
11/3/09 at 10:11am
When trying to figure out what is more cost efficient don't forget to figure in time. I opened my place from scratch and managed to do so fairly cheaply by doing my homework, research, and diligent shopping. However, it took me 6 months to get open, which translates to 6 months without income only outgo. So cost efficiency can be real subjective.
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