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Soonerborn75
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Posted: 7/8/2012 9:04:34 PM
[Last Edit: 7/8/2012 9:19:12 PM by Soonerborn75]
Originally Posted By Skunkeye:
I'd read Anthony Bourdain's Kitchen Confidential, he spends a lot of time in that book talking about restaurant owners whose friends told them, "You should open a restaurant."

I'd also watch a couple of season's of Kitchen Nightmares.

Be prepared to essentially live at the restaurant.


Thanks for the book mention. I read it yesterday/last night. I enjoyed it but he was discussing higher end places, not sure that translates well into the low/mid end sit down restaurants. His examples were pretty straight up stupid ideas to begin with.
douglasmorris99
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Posted: 7/8/2012 10:07:08 PM
Originally Posted By Soonerborn75:
Originally Posted By Skunkeye:
I'd read Anthony Bourdain's Kitchen Confidential, he spends a lot of time in that book talking about restaurant owners whose friends told them, "You should open a restaurant."

I'd also watch a couple of season's of Kitchen Nightmares.

Be prepared to essentially live at the restaurant.


Thanks for the book mention. I read it yesterday/last night. I enjoyed it but he was discussing higher end places, not sure that translates well into the low/mid end sit down restaurants. His examples were pretty straight up stupid ideas to begin with.


They were stupid times...
SOCIALISM, COMMUNISM AND FACISM ONLY WORK WHEN THE BOOT HEEL OF THE LEADERSHIP CLASS IS ON THE NECK OF THE WORKING CLASS, PICKING ITS POCKETS FOR THE LEISURE CLASS
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Soonerborn75
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Posted: 7/15/2012 4:25:47 PM
[Last Edit: 7/15/2012 4:41:16 PM by Soonerborn75]
Ok round 2

So the wife has been asked to run a food stall for a local cultural food fair. They want her to do it and are providing incentives because they have mostly mexican/tex-mex entries as the only non-american cuisine. This is a new event but based on last years success they are ramping things up and are expecting a turnout of about 5k maybe as many as 7k.

This has led to some rethinking on our part. What she wants to do now is use this to gauge support for the type of cuisine she wants to have in the restaurant eventually. So the plan is to serve up some singapore hawker food and get some surveys returned by offering a free dessert with a returned survey.

The plan from there is to buy a small low end food trailer IF the support is there AND she can manage to get agreements with a few owners to lease a spot. I have my reservations about a food truck/trailer working in a smaller town like this but this is much preferable to jumping into a restaurant as the potential money loss is much much lower. After successfully running the trailer for a while we would then look to move into a brick store.

My questions concerns.

For the fair i figure out of 5k people about half are going to buy a meal and out of that i figure about 60% are going to opt for standard fair food (bbq, hot dogs, burgers). So we would be competing for that 40% left out of 50% with the other "unique" stalls. Tacos arent really unique around here so i am guessing that we will be directly competing with 2 other stalls. So that should leave us with about 400 as a target. Now my wife has come up with some ideas to drive that number up.

First her goal here is to put her food in as many peoples hands as possible, not to make money. So she is going to set up the pricing below what you would typically expect to pay at a fair (charge less than the avg burger n chips for a comparable size meal). She has come up with a menu of a few itens that she can do this and still make enough to cover expenses.

Secondly she wants to sell bottled water at cost (water + cooling) to attract people.

Third she is going to be dishing up a curry to sell specifically because of the aroma it generates.

I am guessing that even with all of this we would be doing great to get 500 in. She is thinking more like 700 to 1000. While it would be bad to run out of food, i know that buying to much would wind up costing us over 1000 in unsold food. She doesnt care about that because she says that it would be worth spending 1000 to get the feedback and that if it looks like we are going to be low on sales she will cut the price until it moves.

Another concern i have is it feasible to move from a trailer to a brick store (fast casual) or would it be better to just wait and eventually open the brick store?

Right now she has 4 finger foods that are extremely quick frying, 2 main dishes, 2 desserts and 2 drinks + bottled water. Oh and satay, easily the biggest pain/ time consumer but something we both feel is required. The 2 main dishes kind of go hand in hand so that very little effort is required to do one if you are already doing the other. And she is going to have a sampler that consists of a mix of the items that are the quickest and easiest to turn out (she plans on adjusting this to include any under selling item). We have thought about sliming this down but they are all easy and quick to serve up if the prep work is done ahead of time.

We do have an inspected portable stall sourced from a friend. We have an appt to meet with the health inspector who agreed to go over what will be expected. The committee put us in touch with an advisor they have that has 50 yrs catering experience in dfw and okc. We will also get a nailed down list off exactly haow many food stalls and types when it becomes available. Its 2 mths away so its not crunch time yet, still lots of room left to move things around.

All opinions on this are much appreciated. Oh and if you are wondering how did i ever get myself into this, its because i said yes, like a retard, thinking about serving 100 people a little food if we were lucky. Then after talking to the city officials i learn its 5k people not 500.

I know, i know. What happenned to the get experience thing right.
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Posted: 7/16/2012 7:44:51 AM
you should price it correctly
people might buy something once because it's cheap (free), but you don't get a true gauge of how popular it is unless you price it correctly. (food costs should be about 30% of your final cost)

if you give it away, of course people will like it but that's not really an ongoing concern. Repeat customers are the key to any restaurant. You will not be able to judge this based upon a one day fair.

It is a good thing to get her experience. Make sure she does most of the prep work, set up work, ordering work, etc. Tell her that's what every day is like, she should get experience.

it's NOT a good thing to decide on demand in your town. People try stuff one time because, WTH, it's a fair, it''s different, who knows? but the trailer at a spot isn't a bad idea to gauge demand.

I'd take your lower number of meals
if you run out, you run out, you 86 the item and move on. It happens. The perfect restaurant has no leftovers. Esp with the fact you aren't going to be open tomorrow, you have no way of using the leftovers.
Figure out how many meals you need to do to cover all your costs and make some money. See if that meshes with what you think demand is. She should talk with other vendors to get an idea of demand. Weather will have a great deal of affect on it at a one day fair, nothing you can do about it, but plan for the risk.

BTW. usual method for figuring on new business's is to take your best guess. Then double expenses and halve revenues. See if it still makes money. This probably isn't true for your one time spot but it's something to keep in mind.

Having a good event (and I do hope you do) is NOT a good indicator that you should go open a restaurant. It's but one data point, you need to gather more.
I can't tell you how many business's I've seen (we've all seen) where somebody says "gosh, I did this one little thing and it was great and so I opened up a whole big store/business/restaurant and fail miserably because they didn't collect enough data.

HTH
good luck
keep us informed.

Soonerborn75
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Posted: 7/16/2012 1:20:23 PM
Originally Posted By BozemanMT:
you should price it correctly
people might buy something once because it's cheap (free), but you don't get a true gauge of how popular it is unless you price it correctly. (food costs should be about 30% of your final cost)


Ok, my thinking on this, which I didnt express clearly, was to use this to expose as many people as possible to the products so that when/if they see the food truck they will not hesitate to stop because they are thinking about that thing they ate at the fair. They will already have an idea of what she is offering, instead of flying blind. If they didn't try it at the fair hopefully someone they know did and will recommend it.


Originally Posted By BozemanMT:

if you give it away, of course people will like it but that's not really an ongoing concern. Repeat customers are the key to any restaurant. You will not be able to judge this based upon a one day fair.


I agree. Ideally I would like to be able to determine which items were favored, which werent favored and the general attitude/acceptance of the food. I would be willing to bet that if all 5000 tried it that no more than 1 or 2 have ever had anything like it before. This is the part that worries me.


Originally Posted By BozemanMT:

It is a good thing to get her experience. Make sure she does most of the prep work, set up work, ordering work, etc. Tell her that's what every day is like, she should get experience


If a food truck/trailer is born, she will most assuredly be doing all of this. It will be as much a push to find out the feasibility of the concept as her determination/motivation to see it through on a long term basis. For the fair, she will still be doing most of the prep and she will be out front taking ordering, talking to customers (which she excels at). I will be mostly taking care of getting the stuff she needs setup and running the fryer. We have 3 family members who have agreed to help, in the back.


Originally Posted By BozemanMT:

it's NOT a good thing to decide on demand in your town. People try stuff one time because, WTH, it's a fair, it''s different, who knows? but the trailer at a spot isn't a bad idea to gauge demand.


I agree


Originally Posted By BozemanMT:

I'd take your lower number of meals
if you run out, you run out, you 86 the item and move on. It happens. The perfect restaurant has no leftovers. Esp with the fact you aren't going to be open tomorrow, you have no way of using the leftovers.
Figure out how many meals you need to do to cover all your costs and make some money. See if that meshes with what you think demand is. She should talk with other vendors to get an idea of demand. Weather will have a great deal of affect on it at a one day fair, nothing you can do about it, but plan for the risk.


I didn't think about the weather. Thanks for that, thats a big item. Talking to vendors is also a great idea.



Originally Posted By BozemanMT:

BTW. usual method for figuring on new business's is to take your best guess. Then double expenses and halve revenues. See if it still makes money. This probably isn't true for your one time spot but it's something to keep in mind.


Odd but this is basically what I was doing with the food truck. I was going to price out the menu, supplies (any cent spent on it), and take a guess at how many people we would expect. Double the expenses and half the expected visits and see if it would still makes money.

Originally Posted By BozemanMT:

Having a good event (and I do hope you do) is NOT a good indicator that you should go open a restaurant. It's but one data point, you need to gather more.
I can't tell you how many business's I've seen (we've all seen) where somebody says "gosh, I did this one little thing and it was great and so I opened up a whole big store/business/restaurant and fail miserably because they didn't collect enough data.

HTH
good luck
keep us informed.



I agree, its just one data point and its not even really one I had planned on using to determine whether or not to open a restaurant. I was going to let the food truck determine that. If we wind up not going that route then I would have to figure some other way of determining it, before opening one. The food truck idea is growing on me though. She thinks its a great idea. I think its a cheaper way to test the idea out without going into debt and minimizing losses if it folds or doesnt pan out.

BozemanMT
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Posted: 7/16/2012 6:51:50 PM
Originally Posted By Soonerborn75:
Originally Posted By BozemanMT:
you should price it correctly
people might buy something once because it's cheap (free), but you don't get a true gauge of how popular it is unless you price it correctly. (food costs should be about 30% of your final cost)


Ok, my thinking on this, which I didnt express clearly, was to use this to expose as many people as possible to the products so that when/if they see the food truck they will not hesitate to stop because they are thinking about that thing they ate at the fair. They will already have an idea of what she is offering, instead of flying blind. If they didn't try it at the fair hopefully someone they know did and will recommend it.


Yeah, i get what you were saying.
but it's incorrect

If you wife is female.....................
It will go like this.

"look, we sold out in 3 hours, there's huge demand for this, we have to do a restaurant right now before someone else jumps on this"
uh, honey we gave away free food, that's like giving away free beer
"look, we sold out in 3 hours, there's huge demand for this, we have to do a restaurant right now before someone else jumps on this"



Demand is a function of price. People might like something at one price, but it's totally not worth it at another price. (you do the same thing every time in the grocery store "there's NFW I'm paying this much for this food that I love, I'll wait til it's on sale"

You are looking for data, make it good data.

total only slightly related aside. Do you watch Master Chef??? Last week (or two weeks, i watch online), they had the competitors go in 3 food trucks and were on Venice Beach. One truck was Mexican food, one truck was American food, one truck was Indian food. The truck that sold the most food won. They were all priced the same. The Indian food almost won. Over burgers and steak tacos. Price it correctly, get good data.
Soonerborn75
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Posted: 7/16/2012 10:21:12 PM
[Last Edit: 7/16/2012 10:22:02 PM by Soonerborn75]
Your probably right.

I dont watch masterchef. Havent even heard of it. If I was in CA i would not be as concerned about the willingness of people to try it. I think very few people who try authentic singapore hawker food would not love at least some of it.
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Posted: 7/17/2012 10:17:46 AM
Originally Posted By Soonerborn75:
Your probably right.

I dont watch masterchef. Havent even heard of it. If I was in CA i would not be as concerned about the willingness of people to try it. I think very few people who try authentic singapore hawker food would not love at least some of it.




What about doing regular priced dishes (so now you have data) then put someone else out front walking the crowd, handing out little free appetizer samples (that wouldn't cost much either) along with flyers

" hey hey hey, here try some X, it's sooooo good, give it a try, if you like it here's our flyer, we are over there (pointing) in that red trailer come visit us"

now, you get lots of people trying the taste of the food (and getting your name out) and you get good data using real prices.

it's about sales, not marketing.
BozemanMT
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Posted: 7/17/2012 10:18:57 AM
one more thought

what kidn of diet does it work for?????

i mean, what kind of health crap can you help point out with it?

lots of fresh veggies, or low fat or low carbs or whatever?????????

something to differentiate you in addition to the flavor (which is the main reason people eat)
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Posted: 7/17/2012 5:00:01 PM
Your throwing good money away into a business that at best you will never be fully compensated for your time, let alone a profit. Risk versus reward. Ten years of seeing good people burned out or broken has taught me to never enter that market. Forget about vacations, your married to it.
Soonerborn75
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Posted: 7/17/2012 8:25:58 PM
Originally Posted By BozemanMT:
one more thought

what kidn of diet does it work for?????

i mean, what kind of health crap can you help point out with it?

lots of fresh veggies, or low fat or low carbs or whatever?????????

something to differentiate you in addition to the flavor (which is the main reason people eat)


Good tip, we will think on this.
Soonerborn75
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Posted: 7/17/2012 9:32:31 PM
Originally Posted By sakohntr:
Your throwing good money away into a business that at best you will never be fully compensated for your time, let alone a profit. Risk versus reward. Ten years of seeing good people burned out or broken has taught me to never enter that market. Forget about vacations, your married to it.


Well there must be a way to make money doing it or there wouldnt be any restaurants. Of course i dont have any experience in a restaurant but what i have seen so far is to many people not approaching it as a business. Our goal right now is to create and measure demand for a product then work on a way to make that product available for purchase. Eventually the idea is to have this business to run without either of us being involved on a daily basis. Now for the first several years, if we get that far into this, i know its going to take all of our time to make it work. But really how different is that with any business. If at some point we cannot continue to improve to the point where the business runs itself then we are going to sell. I fully figure on how and when to sell out if we cannot make it. We are not going to provide a monthly cash flow into this out of our own money.

I honestly believe that with our complimentary skills we can make this work if it has a chance at all (which we still need to determine). The wife is very hard working. She is very charismatic and is honestly one of the best sales person and haggler i have seen in action. I on the other hand do poorly in those areas but I know numbers and am pretty handy with just about anything. She will be out front and i will be in the back.

Of course you might see a post in here next year where i humbly eat those words.

On a side note, when i got to talking about my wife it reminded me of something i find humurous. I was born and raised in this area moved away for 10 yrs to serve in the navy and moved back home. My wife has only been here a few years. I am constantly amazed at the number of people that walk up and say hello to my wife. She knows WAY more people than I do. I keep thinking this is backwards, they should know me, not her. When we checkout somewhere, the cashier already knows her name and she knows theirs and is asking about their kids or something or other. I just smile, shake my head a bit, and wonder how in the hell she keeps all this info straight in her head. I cant really explain it but people just love her and want to be around her, i guess thats what makes her a good salesman.
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Posted: 7/17/2012 11:25:55 PM
Originally Posted By Soonerborn75:
Originally Posted By sakohntr:
Your throwing good money away into a business that at best you will never be fully compensated for your time, let alone a profit. Risk versus reward. Ten years of seeing good people burned out or broken has taught me to never enter that market. Forget about vacations, your married to it.


Well there must be a way to make money doing it or there wouldnt be any restaurants. Of course i dont have any experience in a restaurant but what i have seen so far is to many people not approaching it as a business. Our goal right now is to create and measure demand for a product then work on a way to make that product available for purchase. Eventually the idea is to have this business to run without either of us being involved on a daily basis. Now for the first several years, if we get that far into this, i know its going to take all of our time to make it work. But really how different is that with any business. If at some point we cannot continue to improve to the point where the business runs itself then we are going to sell. I fully figure on how and when to sell out if we cannot make it. We are not going to provide a monthly cash flow into this out of our own money.

I honestly believe that with our complimentary skills we can make this work if it has a chance at all (which we still need to determine). The wife is very hard working. She is very charismatic and is honestly one of the best sales person and haggler i have seen in action. I on the other hand do poorly in those areas but I know numbers and am pretty handy with just about anything. She will be out front and i will be in the back.

Of course you might see a post in here next year where i humbly eat those words.

On a side note, when i got to talking about my wife it reminded me of something i find humurous. I was born and raised in this area moved away for 10 yrs to serve in the navy and moved back home. My wife has only been here a few years. I am constantly amazed at the number of people that walk up and say hello to my wife. She knows WAY more people than I do. I keep thinking this is backwards, they should know me, not her. When we checkout somewhere, the cashier already knows her name and she knows theirs and is asking about their kids or something or other. I just smile, shake my head a bit, and wonder how in the hell she keeps all this info straight in her head. I cant really explain it but people just love her and want to be around her, i guess thats what makes her a good salesman.


I think it has been mentioned that something like 90% of restaurants fail in the first 18-24 months. If I were going to open a restaurant I would be looking to minimize my exposure through identifying a variety of finance streams, but I would more likely buy into a successful franchise that comes with name recognition.

-shooter
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Posted: 7/17/2012 11:35:33 PM
A restaurant is a life, not a job. 24/7/365. You NEVER get a break. Even on vacation, you are there in your mind. A mental, emotional, physical prison...

Trust me on this.
Do you like BACON?! I made my own...you can, too; it's VERY easy! http://www.ar15.com/forums/topic.html?b=10&f=19&t=629065

How about dry italian pork sausage?! http://www.ar15.com/forums/topic.html?b=10&f=19&t=628430
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Posted: 7/20/2012 12:33:49 AM
Restaurants are risky business. My step-father owns three and has been in business for 20 years. He does well...but I know many others who had great plans and failed due to issues that were beyond their control.
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Posted: 7/22/2012 9:24:24 PM
Chicken balls are not Chinese, egg rolls are not Chines...but do you know how much money is to be made in selling this fake Chinese food? Millions!

Why does every "family" restraunt here sell greek foods? Because they would not make as much profit by selling only greek food. So they market themselves as family joints and sell local dishes as well.

In large cities you can get away with being specialized, but if there are only a few restraunts in yur area then you best be selling what the others are selling or that family of 4 who does not want "ethnic" (is is not their ethnic after all) will go to that family joint for some good old fashion "American" foods from those Greeks down the street.
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Posted: 7/22/2012 9:29:19 PM
You're out of your mind.

I know the restauraunt business well... Don't.


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Posted: 7/23/2012 6:54:22 AM
Three of my friends have owned three totally different types of restaurants.

1. Bought into a national pizza chain. No previous restaurant experience. Was in business about four years, made decent money. He decided to sell because he couldn't find a night manager that he could trust. He said a good manger is worth their weight in gold, and even paying $50,000+ per year - he couldn't find anyone who was dependable or didn't try to rob him blind.
2. Owned an upscale restaurant that only served dinner. The owner was a chef who worked in NYC for two decades. Was in business here for about fifteen years. The place only seated about 50 people. He had a loyal clientele, but when the economy tanked, having 5-10 less customers per night eventually killed the business. He'll probably re-open one day, if the economy improves.
3. Opened a fast food restaurant at a mall in South America. He went into it with two partners. 90%+ of the menu is pre-made from restaurant supply houses. His total labor costs and rent are less than $3,000 per month. The place is doing very well, and none of the owners has any experience with cooking - none. They all grew up with maids. They have owned many other small businesses though, and they run their restaurant the same way. If it makes money - keep going, if it doesn't - close shop immediately, and move on.

I also knew two ladies who opened take-out only restaurants - both here in Michigan. One was Filipino, the other was Vietnamese. They were both hole-in-the-wall places, and the owner was the only employee. I think they both made enough to pay the bills, but one closed shop when her husband retired, and the other closed when she got her nursing degree. If either of them lost any money on the deal, I don't think it was much - because they started, and stayed very small.

Opening a restaurant is speculation, in the truest sense of the word. Too many variables to accurately predict if it will be successful, or fail. Of the three examples I listed, the one that I expected to fall miserably is the most successful, with the best long-term prospects. He doesn't know anything about food, but he knew what people wanted to buy, and where they would buy it. Good luck in whatever you decide OP.
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Posted: 7/24/2012 1:12:58 PM
I love running ours. My wife does the cooking and I run the office and the front. If this is what she wants to do, be prepared to put in the time. There is nothing at our place that we dont do. I work the line, the dishpit, and PR with the customers. Your staff will be so unrealiable, that you have to be able to step in and do any job at any time. Our place has been open 26 years and I couldnt see myself doing anything else. Good luck
"If that sidearm was a girl, I'd tap that like a mafia phone line." -nineisfine
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Posted: 7/31/2012 1:21:52 AM
Originally Posted By KeepShooting:
A restaurant is a life, not a job. 24/7/365. You NEVER get a break. Even on vacation, you are there in your mind. A mental, emotional, physical prison...

Trust me on this.


+1 on this

OP,

If you want to get the restaurant experience, have your best friend kick you in the balls everyday for 2 weeks and then ask yourself if you want to live the next 10-20 years this way. Just kidding but that is what it is like if you make the wrong deal and buy the wrong business.

It can be a good business but you need a great location. A close second is the labor market in your area. If you have these two elements, you will have a chance at a profitable but somtimes hard life. Also consider, you get what you pay for. If your credit is good, you could spend 90k and walk away with a six figure income and a debt that you could manage easily. If you have any specific questions, PM me.
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Posted: 8/2/2012 1:16:43 PM
I know a Hmong gentleman who started a stall at the local fairs and Hmong festivals. He did very well and even worked 9-5 doing HVAC work with me during the week. He made his own cooking apparatus and eventuallu all the other vendors copied him, or he sold his custom grills to them. Eventually everyone else copied him and it negatively affected his business.

Another friend started a stand at various fur rendevous here in MN. He was doing well until he actually had to buckle down and fully implement all the government regulations. He said he had to charge at least 3x cost to make money. Just family––mom, dad, kids worked the stall. He is a chef and ran a local resort's kitchen.

I, personally won't buy a product that contains pork or shellfish due to religious convictions. Other people have various allergies and dietary concerns. Can your menu accomodate this? If I can't eat at a place, even if the food is good, how can I recommend it to my sphere of influence?

Price it right, not give away. Most cheap food I have tried has been bad, so now I think "if it's that cheap, can it be any good"?

Is your market at the fair the same as what your eventual, target market will be? If not, will the info you gather be valid for the big picture?

People do restaurants all the time, some fail, some don't. I would even pay people who are successful for their advice if I were really serious. Good fortune on your endeavor.

PS––It's still not too late, even after the fair, to implement what others have said about getting the practical experience or schooling.


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Posted: 8/9/2012 12:53:51 AM
That business is funny. I am a CPA, and have worked in a few firms. Every firm had restaurant clients. Many showed losses. One of the partners told me one day that "many restaurant owners know how to skim cash, so these restaurants are making money." With that said, a few of the restaurants made really great money. One of them was an Italian joint in a seedy part of town. The owner/chef W2d at 70k, and pass through income was at 110-140k/year. That's great money. The guy is taking 200k/year for running a decent joint. Not bad.
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Posted: 8/12/2012 4:08:17 AM
Add me to the list of people who say "just because you can cook a great _____, doesn't mean you can run a restaurant".

CHEF is overcharging you. For only $9k, I will come to you and slap BOTH you and your wife for thinking about opening a restaurant.

If she is really set on the idea, have her work at one for a few years to fully understand what's involved, otherwise you're setting yourself up for disappointment and big financial losses.

I believe that all politicians are born with a genetic flaw that compels them to meddle in the affairs of others.
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Posted: 8/12/2012 4:54:50 AM
I'm going out on a limb here, but assuming that your town of 25,000 is of a similar mindset of an Arkansas town of the same population, I doubt Singapore Cuisine is going to have people knocking down the door.

Let's use Jonesboro, AR for an example. It has a population of >65,000 not including around 10,000 to 15,000 students as ASU when school is in session. They do have around 10 chinese restaurants with one or two advertising "Thai Style" menu items.

What Jonesboro doesn't have is any "ethnic" restaurants, certainly none advertised as a Singapore Hawker.

The closest town to me has a population of around 8,000 people and it couldn't even support a Burger King.

Now, your town may be a beacon of cultural enlightenment and sophistication; it may embrace Singapore Hawker cuisine like an addict to crack cocaine. My gut feeling, however, tells me a steakhouse would come closer to suiting the masses tastes.
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