[chefclaycollins]

I have been cooking for 10 years and am ready to open my own restaurant, but I have some things to figure out before I can do it.

First, where's the best place to find sympathetic lenders?

Second, does any one know the best way to survey people to see what they really want in a restaurant? I know what the people that eat in the restaurant I work at now want, but am interested to see if the rest of the town feels the same way.

Third, is it bad to buy a restaurant/bussiness and change everything about it?

Fourth, I was told that if the owners won't carry the loan, not to buy. Does this sound right?

The restaurant that I am trying to buy is a little pizza/pasta place that isn't very busy, mostly due to the fact that there has been 3 owners in 3 years and the last 2 owners hadn't even ever worked in a restaurant before! I want to turn it into a deli, take out, and catering bussiness, because this town is screaming for it!
A kind of Dean and Deluca so to speak!

Any ideas? I'm just a cook how has big dreams and I'm trying everything I can to make this happen.

 

[joshua tomczyk]

First off I do not own a restaurant. But I do know quite allot about the restaurant business.
The only way to get money form people is to have a very precise business plan. Min 5 years estimated P&L, Demographic info. Target customer base etc. ( There are many books on business plans) You have to have something other than faith to get people to invest real money.

You could of course mortgage your life, house, car, Life ins. etc. I would not suggest it though. You never want to put all your eggs in one basket. One mistake could ruin your life. If you were even considering this it would be all the more reason to do the research and plan. There is are many reasons that 90% of restaurants close in the first five years.

When you say 3 owners in 3 years that would scare me because, it could be that there shouldn't be a restaurant there at all. When opening a restaurant location is one of the most important decisions you have to make. The only way to make a smart decision is to do the research. It is easy to get caught up in the concept but as many people find out even a brilliant concept alone is not enough to make money.

Always remember that, no matter how passionate as you are about cooking, you will be running a business. They are entirely two different things.
It is possible to succeed without putting in the time to actually research everything but you will be leaving allot up to luck.

I wish you all the luck, but don't rely on it.

 

[snakelady1]

Find out if the city has a revolving loan fund to encourage new business check out the county and see if there is an economic developement corporation. Check with the local chamber of commerce and ask their opinion of a deli/catering business, ask if they have any programs for preparing a business plan. Check with the state department of commerce for advise on your business. Are you a minority? See what programs are available. There are a few programs to help poor people start businesses but there are alot of hoops to jump through. I found that no one will loan you money unless you are investing some of your own money also....hope this helps

 

[fodigger]

The first thing you need is a solid business plan as Joshua said. Next as snakelady said, you will need to have some money of your own as nobody is going to give aunproven person money to run one of the most difficult businesses out there unless you show them you are willing to take the risk.
Not knowing you do you have any management experiance? If not get some take some classes if possible. There are computer programs to help you w/ your business plan and quickbooks is avery easy accounting program from start-up businesses.Good Luck and do your homework.

 

[panini]

CCC
There are a few basics to ownership, but nothing is really set in stone. A solid business plan is good, if it's a business plan and not a concept plan. A lender usually reads through the fluff and targets the numbers.
I must tell you, there is no better time to go into business then right now. There is more capital in the private sector then ever before. People are wanting to invest in things that they can actually touch.
You'll recieve so much information and views when posting a question like yours. You must absorb what will pertain to you and set aside the rest.
No one here knows your situation. You say your ready for ownership after 10 yrs. in the business. Does that mean you have saved $$$. or experience?
The only thing I can offer you as an owner is to go and purchase 1 ot 2 hrs. with a CPA who has business developement experience and get your questions answered based upon your situation. This person should be able to advise you about what's availible out there for funding.Find out if you're financially ready to open a business.
Next, have a sit down with your family or the persons closest to you and make sure eveyone is on board. In most cases, ownership requires unconditional support from those directly around you.
Just listen when persons tell you"if someone won't finance their business, stay away". Use common sense. I know when we sell, I'm expecting a big fat (make that huge!) check from the buyers lender. Why would I finance someone who I don't know. This doesn't mean my business is bad.
Feel free to PM anytime and the best of luck
Jeff

 

[peachcreek]

What I would do if I were you would be get another restaurant position that is strictly management. By the time you get ready to put your money into a venture of this magnatude, do yourself a favor. Get some practice on someone elses' money. That is what I did. And when I was ready to open my own place, I had a lot of the questions like yours already answered, only to find out how little I had thought things through. I had 4 management jobs with financial responsibilities that I worked at for 6 or 7 years before taking a risk with my own money. And it was still much more involved than I had thought it would be. Good luck.

 

[chefclaycollins]

Business plan- DONE

Money to spend of my own- DONE

Management experience- No problem!

CPA- That's my MOM!!

Family behind me- **** yes!

Money to do it- We'll find out!

Thanks for the help. I actually am not going to be able to do the deli thing, I realize know that the initial investment is way too much for me. I guess that's why there isn't one around, HUH! Oh, well I guess I'll just have to suffer and open a nice little restaurant with the money I have and a little help from Mom and Dad. Shouldn't be too bad. I just have to remember, baby steps, RIGHT! I'll let you all know how it turns out.

 

[kuan]

Three owners in three years might mean there's something inherently wrong with the location, the building, the concept, the floorplan, or the whole shebang. Heh I did a case study once on location which had three different tennants in three years. It had tons of traffic and always looked full, but for some reason none of the restaurants in that location could make their rent. It turns out that there were too few seats in that unit. People could not find a place to sit, and there was little room to wait. Table turns were slow so people couldn't get in and out in the 30-40 minutes they had for lunch so they went elsewhere. Place was FULL, but only when people wanted to eat. Anyway, hope you find what you're looking for clay

Kuan

 

[suzanne]

Kuan raised an excellent point: have you looked deeply enough into the site to know why no one's been able to make it work? Could be the rent -- so you'd have to work out a better deal with the landlord. Could be the utilities -- how much has it cost the previous owners to run their equipment, and how much will it cost you? Could be the traffic -- is it not busy because of lack of foot traffic or parking or visibility from the street?

In a lot of cases, places fail not because the owners don't know what they're doing, or because the product isn't good -- but because of external factors that they didn't think to check out beforehand. You have to do a lot of detective work to find out why 3 owners haven't made it there. And then work solutions into your business plan.

 

[kuan]

Nods Suzanne. Many business plans have little to do with logistics. Many restaurant owners also don't look outside their industry for help. One time I was asked to figure out why a place which had kickin' food and extremely fast service was barely making it. It needed to desperately get over the hump. This restaurant had great reviews and once again from the outside, looked like it was always busy. (Of course, the only time you notice a restaurant is busy is when it's time to eat). In any case, this restaurant always had a line at the door, but for some reason there were always empty seats... ie., a wasted opportunity to increase revenues. Table turns at this restaurant were around 20 minutes, fast by McDonald's standards. But this didn't do any good. There was tons of foot traffic but nobody wanted to come in because the restaurant seemed full to them. They just did not want to wait.

For some reason I thought Disneyland, but it might as well have been any amusement park. Nobody wants to get in an already long line. What they do in amusement parks is move the line out of sight from potential riders. The answer was right there. My solution was to remove one table and move the host station inside so the line wouldn't go out the front door. We managed to squeeze four more covers in at the end of the day, which amounted to an extra $30 in sales each day. Just enough to make it profitable.

Kuan