I don’t quite change color but I do change my persona. Do you ? Or do you pretend not to notice ?
I walk in the door and I leave behind the strong decisive aggressive Wendy and become the warm hugging and kissing wife, mother and friend. Every day. Some days it is not so easy and I find myself going to hide for a few minutes, in the bathroom or my closet, to let the chameleon out. Other days this feels like a seemless transition and my life is one. Why do I need to be two people?. I feel like I am two people with two lives that don’t intersect but live side by side. Not one more dominant or important than the other.
What I experience, and what many of you may experience is being referred to as “context switching”. This is particularly relevant to successful business women who also maintain a strong connection with family. The idea of context switching originally only applied to computer functions , then spread to multi tasking and all the reports that found multi tasking to be unproductive. Now, we see the idea of context switching being applied to the way we interact at work as compared to our personal at home interactions. Switching how we behave in these two very different environments with very different rules and limits, in order to be successful.
When I am paying attention, I feel the change. The shift between being the business owner who is strong and assertive to being the soft, warm wife and mother. I think it happens so automatically that we don’t even really notice. Its our only way of being. But is it ?
Its likely more noticeable if you work outside of your home and you “change color” in the car or train on the way to work. For those of us whose days intermingles family and work in a less structured environment struggle more with the constant switching. It is tiring !
Benjamin Cornwell, assistant professor of sociology in the College of Arts and Sciences at Cornell did a study and found that men and women experience some activities similarly. Time at home, with children and commuting times are not significantly associated with stress for either men or women. Yet, switching between these contexts is much more closely associated with stress in women than in men. While men are likely to report fewer switches overall, women are twice as likely as men to experience more than 20 switches in a day. Cornwell speculates that the multiple roles and contexts that working women juggle on a daily basis increase the unpredictability of their everyday lives more so than it does for men.
“Switching is a constant reality for women – morning, day and night – and they switch between more disparate social roles. They go from being at work, which is formal, authoritative and hierarchical, to being at home with a child within a matter of 10 minutes,” he says.
I went in search of successful business women to interview and find out how they deal with the concept of context switching in their lives.
Julia Pimsleur, successful entrepreneur (Little Pim language teaching for kids) and scaling coach (Million Dollar Women online business program for women entrepreneurs) says she chose to start her own business in part because it meant she wouldn’t have to do code switching. “My two boys were part of my business from the beginning – they were in my language teaching videos and as they got older helped me at home with everything from subtitling to weighing in on new characters we were creating. I felt I could be by and large the same person at work and at home. Of course, there were days I came home and needed to get into “kid mode” by dropping down on the floor to play with cars or drink a glass of wine with my husband to get out of “bosslady” mode but by and large the transition wasn’t that major.” Pimsleur says she thinks many women are drawn to starting their own businesses because they get to define the culture in their work culture (in her case she hired several other working moms and they all had a great deal of flexibility) and create an environment where they can bring their full- selves to work. And take that same full-self back to their partners and families.
Billie Anne Grigg, mom and owner of Pocket Protector Bookkeeping says “For me, mindfulness is the key to successfully switching between my roles as mom/wife and business woman. I start my day with 10 minutes of meditation, and – whenever possible – I end my day with an additional 10 minutes. This time allows me a buffer between the two very different areas of my life. And it works great… when the kids stay out of my office. Since I work from a home office, though, I often have to make a context switch in under 10 seconds. Mindfulness to the rescue again. My family knows if I hold up a hand and take a deep breath, that is my way of becoming fully present for them. The deep breath is my reset point. “
Ironically, the thing that allows me to live my life fairly guilt-free, says Samantha Ettus, bestselling author and CEO, Park Place Payments, is the same thing that makes “switching” relatively easy for me. It involves aiming to be all in wherever I am. If I am at home, I intend to give my full attention to the people in my home. If I am at work, I intend to give my full attention to work. The less I blend and the more I set boundaries, the easier it is to move back and forth fluidly. At times of course, you can feel a little bit crazy going from a serious business meeting to a school play and then back again. At those times, I laugh and think if someone were to watch this scene in a movie, they would find it inane. The less seriously I take myself, the more fun and less overwhelming life is!
Marlo van Oorschot, managing partner of Van Oorschot Law Group, PC, a boutique family law litigation practice, who is not a mother of children, but a mother to her dogs, and a wife,also faces these issues with balancing a very demanding career with her personal life. “I struggle with this daily. I go to work and have to be the protector and defender of my clients; be a mentor and a manager to my employees; be mindful of my obligations to my colleagues and of course the judge in our litigated matters. After giving all day, standing strong against these storms, it is very hard to turn it off at home…and for myself. A regular routine of exercise, yoga and “me time” and “us time” with my husband is a must. Though knowing this importance of balance, I always find myself feeling guilty that I should be doing something else. “
In my quest to find a solution or a piece of magic, I found interesting, smart and successful women who are all aware and working on strategies for their chameleon self. Time for me to learn from the best and work on my own strategies. As a community, we welcome your thoughts……
About the Author
Wendy Barlin is a Certified Public Accountant with 20 years experience spanning diverse industries such as entertainment, professional services, hospitality, real estate and medical groups. Wendy is originally from South Africa and after a year traveling abroad, fell in love with the sparkle of the City of Angels and decided to make Los Angeles her home. Wendy is a member of the AICPA and CAlCPA societies.
Barlin Business Solutions is so much more than an accounting and income tax firm. They specialize in taking all the tedious financial chores off the shoulders of busy professionals so that they can focus on areas where they excel.
The location of your restaurant will impact its success nearly as much as the menu – or anything else. If your restaurant is in the wrong place, you won’t attract the amount or type of customers you will need to stay in business. The same is true if your location is inundated with competitors, or has poor visibility, or is hard to find. There are many things that must be considered as you look for a location in which to open your business.
But first! Nail your concept. It is much easier and will save you money in the long run (and probably short run) to have your concept set and solidified before embarking on a location search. The right concept in the wrong location will fail. The wrong concept in the right location will fail. The two – concept and location – must both be right in order to succeed.
Your Target Market
Knowing who your target market is, is imperative to finding the right location for your restaurant (again, concept nailed at this point). If your target market is families, then you won’t want a downtown business location or one with little to no parking. If your target is foodies, then a small out of town location most likely won’t work either. When you know what your target market is, then you can study the demographics of your desired location to see if it will work for you.
Once you have an awareness of who populates your desired location, including things like age range, education level, income level, and even the crime rate, then you can determine if this location will attract your target market. Plus, spend some time near your desired location and look at the other businesses – especially the ones doing well. Who frequents these businesses? When? What are they buying?
You will want to figure out how high the traffic is in your desired location. The greater the traffic, be it pedestrian or drive by, the better the chances you have of attracting people off the street, i.e. people who don’t make reservations.
Ease of Access and Visibility
Along with the area traffic, you will want to see if your desired location has easy accessibility and good visibility. Is it easy to drive to your location, is it easy to find on the highway or on the street? When entering your location, are there obstacles to getting there, such as one-way streets, obstructions, on-going construction, and other things that could alienate potential customers.
How about for you? Is it easy for you to get there? As the owner, you will be at your restaurant quite a lot. Can you get there easily; is it a long commute from home? The easier it is for you to get to your own restaurant, the better the location.
Availability of Parking
Is there parking available in your location? Will the offer of parking be a necessity or a perk? For example, if your location is in a busy city with limited parking, you may want to offer valet parking services, or locate a lot nearby that you can utilize for your guests at a discounted rate. If your desired location is a rural one, then parking may not be an issue.
Evaluate the Competition
Competition can be a good thing as long as it doesn’t hurt your business. If there are too many establishments offering the same menu as yours, then it could detract from your business. Do some serious market research to determine the competition in your area. This can be done online; in addition to driving around the area to see what other food establishments there are already. Plus, spend some time in these establishments at different times of the day and make note the number and kinds of people you see and what they order.
Competition can also include any other type of establishment that sells food. For example, if you plan on opening a deli that sells fresh sandwiches, the local grocer that also sells fresh deli sandwiches is a competitor. You will need to know all these things before you open so that you can plan accordingly.
A final word about competition, the more research you do before you settle on a location the better your chances will be for success.
Finding the right location is critical in ensuring a successful business. You want customers to easily find you, enjoy their visit, and keep coming back. This can be accomplished quite easily if you are in the perfect spot.
Evaluate the Costs
Finally, yet equally important, is to evaluate all the costs involved with your location. As mentioned in our previous article, Boston Restaurant Group Founder, Charlie Perkins, tells us that total Occupancy costs should not exceed 8% of gross revenue. Knowing this will require you to have a detailed set of projections giving you a location budget to work with.
While a detailed set of projections is not only important but very necessary, let’s not jump ahead of ourselves. At this stage of your restaurant start-up, assembling the right team takes top priority.
According to Adam Amontea, President of Cafco Construction Management (Cafco is THE “go-to” GC/Builder for restaurants in the Boston-area and has been for a very long time), “Working with an experienced architect, designer, food service consultant, contractor, attorney and accountant early in the process is an investment that will pay dividends. Each of these project stakeholders will help establish realistic expectations and take more of the mystery out of a process that can be daunting…”
Here are the Team Players:
Attorney: You’ll most likely need to engage an Attorney from the get-go. An Attorney can inform you of the best entity structure for your business and set that up. And then there is the licensing… especially in the City of Boston, this can be a tough and bumpy road to navigate. Adam adds that the right Attorney will counsel you on “licensing timing, limitations and costs” all of which will be extremely important in getting started.
Architect/Designer: In our opinion, this is non-negotiable, even if your Aunt Sally has a really good eye for design. Designing both the interior and exterior of a restaurant has many nuances and code issues that must be addressed and using a novice, or someone not familiar with this territory will cost you way more than you might think you’ll be saving. Adam adds, “Design test fits help to evaluate occupant load, code compliance and potential requirements for variances, all which can impact timeline, budget, and lease negotiations.”
Contractor: Getting the right Contractor on your Team can pay off immensely in more ways than one. For example, while in negotiations with potential Landlords, Adam mentions that a seasoned Contractor will know and understand “landlord delivery conditions vs TI (Tenant Improvement) contributions” which can possibly offer some start-up savings if the landlord is willing to take on some of the work. Also, “…early budgeting, zoning due diligence, required permitting, and duration of construction vs rent commencement, etc…” according to Adam is essential information for the business owner to have and be aware of during this expensive, cash outlay of the start-up period.
Accountant/Business Consultant: If this is your first rodeo, then there will be no cost/stress savings other than hiring a professional who has been there and seen this all before. They can be a trusted Guide to help you navigate the many, many moving parts, offer experienced advice, and keep you moving in the right direction with eyes wide open.
Adam’s final words of advice…
“Opening a restaurant, or any business, but especially a restaurant is not a small undertaking of any kind. Working with the right people and having the right Team in place will help you to truly understand the total investment, and risk, associated with such a venture.”
We couldn’t agree more.
Special Thanks to our article contributor, Adam Amontea, President of Cafco Construction Management.
Cafco is the leading General Contracting firm for restaurants in and around the Boston Area.
A former restaurateur turned bookkeeper turned Profit First Consultant, Author Kasey Anton is on a mission to help eradicate restaurateurial poverty. She and her amazing Team at Spark Business Consulting have been helping restaurants get started, get organized, and get profitable for the past 10 years and counting.
Favorite Quote? “People don’t care how much you know until they know how much you care. “ – Teddy Roosevelt
Yeah, the food part of owning a restaurant is important. It may or may not be the most important thing, but it’s up there.
There are the actual food choices, menu mix, that’s an important element. While it’s important not to be all things to all people, and offer food from every genre and nationality, it’s equally important to have a smart selection. This will help you not to ostracize too many diners and allow your restaurant to stay an option for people looking for a place to eat that can please their entire party. The exception to this would be a very niche specialized establishment such as a quick-serve restaurant serving Grilled Cheese Sandwiches. If that’s your “thing” then be the best at it and do just that. But generally, in sit down casual to fine dining establishments, the menu mix needs to suit a slightly larger audience yet still be cohesive.
One strong piece of advice that we always give our current and potential restaurant clients is to “stay in your lane”. Spend some time developing a menu that has meaning to you, be in love (or at least in like) with the dishes and think about variety enough so that a meat-lover can bring his new vegan girlfriend to your place without hesitation.
Renown Chef/Owner of The Quarry Restaurant in Hingham, Massachusetts, Greg Jordan, also adds…
“When planning the menu, I always like to consider current food trends, as well as consider the target audience. Consider the local tastes and preferences as well. You also want to develop dishes that are allergy aware and convey that info easily and clearly to the guest, so they feel comfortable ordering their special meal from you. Don’t forget kids…if you can keep them happy, you have a much higher chance of keeping the parents coming back. Dessert, coffee & n/a (nonalcoholic) beverages are also great profit boosters.”
There should be a cohesiveness to your menu and even cross-utilizing some ingredients is ok (especially food cost-wise) but you don’t want to necessarily highlight that (you could look cheap or unoriginal) but the goal is a theme or story that your menu could play out for your guest.
In addition, Chef Jordan adds, “buy a whole chicken and serve the roasted breast as an entree. Cook the thighs and serve as a taco app etc. Definitely no shame in cross-utilization.”
Once you’ve written out and visibly reviewed your menu, and it hits on all the points stated above, now it’s time for recipes and costing.
The recipes are to ensure portioning and consistency. Each dish on your menu, each and every dish from the side dishes to the desserts, should look, smell and taste the same 24/7 no matter who orders it when. This can only be ensured by proper training and an extremely important piece to that training are recipes and pictures. (Videos would work great for training as well).
The popular food blog by “Toast” recently posted an article about food cost authored by Ed Heskett. In this article, Mr. Heskett refers to “Re-Engineering Your Menu”. He states, “Take a long look at your menu and learn to use the basics of menu engineering to eliminate the menu items that are costly to prepare and unpopular. These are the items that are sending your food cost way up without bringing in any extra profit. Then, figure out which items are most profitable and find a way to upsell them.”
And finally, there is the actual costing…
No matter how good a dish looks, smells or tastes, if it doesn’t make you money – it’s costing you money.
We were recently working with a catering client who creates and delivers meals and sells them by the week. There was one-week last month where she thought she really just knocked it out of the park. And she did as far as her clients were concerned. The menu was outstanding, so robust and just “wow” that her clients could not stop commenting about how that was the best week yet and wanted more.
Our client was thrilled with this feedback and started to feel like she finally “made it”. The problem was that once we produced the numbers for that week, the food cost on that menu was 50%! That’s 20% more than it should be! As a matter of fact, that week of delivery meals cost my client over $1000. That’s literally money out of her personal pocket to pay for that week’s meals. We can call it a “marketing expense” since it certainly got a lot of attention and helped to solidify her client’s loyalty, but a loss is a loss and you can’t operate a business that way if you want to stay in business.
Now, we know that not all dishes can be created equal. Some dishes might inherently come with a heavy 40%-50% food cost but those are offset by dishes that sell equally, or better, and are costed at maybe 10% to 20%. For example, the main entree at a steakhouse might be costed out at 50%… a prime filet mignon might cost $20 and the steakhouse really can’t get away with charging much more than $40 for just the filet so that’s a 50% food cost. But steakhouse menus are often a la carte meaning sides cost extra. Therefore, a side of let’s say steamed broccoli might cost $1 to produce but can hold a menu price of $6 – that’s a 16% food cost. As a matter of fact, most side dishes come in somewhere between 10% and 20% which can help offset a few higher cost menu items.
In summary, here are the action steps to creating a menu that works.
Create and design a menu that makes sense. That tells a story or has a theme. Don’t be all things to all people. Keep in mind that there are certain types of food that a portion of the population are allergic to, or just do not like, and have enough variety to please the majority – but maybe not everybody.
Create recipes and training cards with photos and/or training videos that ensure consistency in every one of your dishes at all times.
Cost out every single recipe right down to the salt and pepper. THIS IS EXTREMELY IMPORTANT. Your entire menu should be costed out and then create mock orders and calculate what the average food cost per diner would be. If you offer bread and butter/oil service, figure out what each serving costs and add that to every appetizer and main meal cost. When you are done with this exercise, you should have a strong idea of what your overall food cost should be and CLOSELY watch your weekly and monthly financials to ensure that your actual food cost is matching your estimated food cost from this exercise. One great way to keep an eye on costs quickly and efficiently is having a separate bank account dedicated to COGS. For example, if you know that your COGS should come in at 30%, then allocate 30% of every deposit to a COGS checking account. And then use that checking account to pay your COGS vendors. If there isn’t enough money in that account to pay your COGS vendors – you’ll know right away and can start looking for the leaks and adding higher profit margin specials… or initiate a server contest on who can sell the most sides (or other items that have high-profit margins).
If it is coming in on target, then great! Work on beating it with some fabulous specials that can help knock off some food cost points which will then turn into profit$! If your food cost is coming in higher, then you’ll need to exam each dish, check your inventory for theft or waste, check your vendor prices for any price increases, evaluate your menu mix, and make some changes as quickly as possible in order to stop losing money. This is why it is critical to know your food cost at all times, weekly, or at a minimum monthly. After all, if money starts flying out the window, wouldn’t you want to close that window as fast as you can?
About the Author
A former restaurateur turned bookkeeper turned Profit First Consultant, Author Kasey Anton is on a mission to help eradicate restaurateurial poverty. She and her amazing Team at Spark Business Consulting have been helping restaurants get started, get organized, and get profitable for the past 10 years and counting.
Favorite Quote? “People don’t care how much you know until they know how much you care. “ – Teddy Roosevelt
As a fitness professional, you are a world changer. You do some of the most important work on the face of the earth; you create happy and healthy by helping people move better, perform better, look better, and probably most importantly, feel better. You are a superstar.
But, you say, if the work I do is so important and so many people need it, why am I struggling to get ahead? Why aren’t I making what I am worth? Why can’t I seem to attract the people who need me into my business? Why do more sales never seem to add up to more money in my bank account? I love what I do, but all this “stuff” always just seems to get in the way.
I get it, because I have been there. The good news is all these questions and all these current challenges you are facing absolutely have answers and are solvable. But be prepared to do the work. There are many parallels between Physical Fitness and Fiscal Fitness.
Imagine your clients who want to lose weight or get stronger. They aren’t going to lose 50 pounds of body fat or gain 100 pounds on their bench press in a month. And just like them, it’s going to take you time and effort to build the business of your dreams.
Let’s take a look at what five successful fitness business entrepreneurs and coaches who know what it takes to build a “Fiscally Fit” business have to say about it.
The Top 5 Tips to Fiscal Fitness
Tip 1: Learn How To Scale and Build A Team
Doug Spurling, President and Founder of Spurling Fitness, and author of “One Percent Better” knows the power of building a great team. “If you are a one man or woman operation you are always going to be capped at how much you can make, because you’re trading time for money” he explains. “In order to scale and make more, you have to build a really solid team.”
Spurling outlines his 3-step approach:
Get clear on your vision. How big of a business do you want? How many team members? Biggest is not always better, and there’s no right answer but we need to know that first.
Hire people that complement each other. Don’t hire a bunch of duplicates of you. Become very clear on what your unique abilities are and hire the areas that are not those.
Be a student of leadership. Building your team, leading your team, is all about giving them the support they need and being seen more as a “mentor” and not a boss.
Doing this allows you to be tied to the business, it allows you to scale your time, make more money, and have more personal freedom.
Tip 2: Learn How To Be An Effective Marketer
Ryan Ketchum is the Executive Director of Fitness Revolution, whose company specializes in Strategic Business Coaching and helping fitness pros become better trainers and business owners.
Ketchum sees the number one challenge preventing fitness business owners from making more money as effective marketing, and an overall marketing strategy.
Ketchum analyzes the problem this way. “There’s a wide range of issues revolving around marketing that I see, and it’s not just for beginner fit business owners. Specifically, fitness business owners don’t have a strategic marketing plan that they can use to bring in new leads and then scale their marketing efforts when needed.” He then points out the problem. “Instead of a calculated approach to marketing, many fitness business owners perform random acts of marketing when they have time or when they think about it.”
Ketchum advises the strategic marketing plan be comprised of the following elements; Identifying your Ideal client, Identifying and communicating what makes your fitness business different, simplifying your marketing message, and a marketing calendar.
“Marketing cannot be treated as a side project in your business.” Ketchum warns. “It needs to exist as one of your responsibilities as a fitness business owner, with time dedicated every day to market.”
Tip 3: Track Your Numbers
Mark Fisher operates his ultra-successful “Ninja Clubhouse”, Mark Fisher Fitness, in one of the most competitive environments in the world, New York City.
Fisher says that tracking your numbers is the best way to know why or why not you are making the profit you want.
“If you don’t have some kind of dashboard and you’re just looking at how much money you have in the bank, you don’t know where the issues are. Is it not enough top-of-funnel leads? Is the sales process wonky? Are people signing up but leaving because your services are subpar? Are you simply spending too much of the money coming in?” He goes on to say “A related point is that if you’re not tracking, you don’t know if you’re off-track on any of your target numbers until it’s too late.”
Fisher advises to keep it simple. “Just start tracking something. Pick 5-8 numbers, put them in a spreadsheet, and figure out how to track them on a weekly basis.”
Tip 4: Don’t Focus Solely on Facebook
Michael Keeler created “Business for Unicorns” with Fisher in 2016. Michael is a Certified Life and Business Coach, works with many of the leading fitness studios in the US and UK, and counts among his clients Sony Music and Sylvan Learning.
Keeler sees the number one challenge holding fitness business owners back from making more money as “the belief that Facebook is the holy grail of lead generation.”
He says that while some people can find great success with advertising on social media, “for brick and mortar studio owners Facebook marketing is not the only option” and encourages them to “invest in other lead generation strategies like client referrals programs, community workshops, business partnerships, and local advertising”, which he helps them do through his coaching.
Implementing even one of the tips above is a sure-fire way to create and increase cash flow into your business, and when properly managed, increased cash flow will equal increased profits. Which leads me right into Tip #5.
Tip 5: Get Clarity by Using A Cash Management System
When I owned Get Fit NH the number one benefit we saw from putting a cash management system into our business (Profit First is what we adopted and use) was clarity.
Why is this important?
Because nothing gives me more peace of mind and the ability to sleep at night than by knowing where your cash is and how it is being used, any time and at all times.
Here’s what implementing a good cash management system does:
Let’s you know at a glance how much money you have and where it’s going.
Ensures you have enough money set aside to pay taxes
Allows you to pay yourself what you are worth and feel good about it.
Provides a system for keeping your operating expenses in check.
Builds in an action plan to get and stay out of debt.
Establishes permanent profitability from day one.
Creating a more profitable business is not magic, any more than weight loss or strength training is. You are skilled at identifying the gaps in your client’s nutrition and training plans, then implementing a system to fill in those gaps so they can reach their goal.
Start building your “fiscal fitness” by carefully evaluating these five tips and choosing just one to implement in your business. Again, it’s like your weight loss client. You wouldn’t tell him five things to do at once, you would work on one habit at a time. Once that skill is built, you move on and layer the next highest priority in.
And remember, nothing happens unless you take action. Open your mind to the possibility that you can and will be more profitable; permanently profitable, and then do something about it. The world needs you to succeed, so let’s make it happen!
Dean Carlson is a certified Profit First Professional and in 2016 founded Fit For Profit, providing fitness business owners with the coaching and tools they need to manage their cash easily and keep more of their hard earned money. His experience as a gym owner came full circle in 2018 when he sold his award-winning gym Get Fit NH for seven-figures. He is passionate about helping fitness entrepreneurs stop worrying about finances and start building the business of their dreams.
Your clients want you to be profitable. Desperately, in fact. But they will never say “Take me for all I’m worth.” or “Rip me off.” or “How can I pay your more money?” Nope, you will never hear those words (albeit I did experience that last one, once). Of course they won’t say those words, but man-oh-man they want you to make money.
Clients will try to knock you down on price, for sure. They will ask you to “sharpen the pencil” or to “do better.” But there is something they want even more. They want you to be able to deliver what they want, when they want it, and with your full attention on serving them.
In order for you to deliver at the highest level, to have adequate resources to get things done and to do all that without stress and distraction, you MUST be profitable.
Just like all of humanity our number one concern is ourselves. Customers care about themselves. And they care that you will deliver on what they want and need.
That’s why customers are desperate for you to be profitable. They depend on you. If you are losing money and struggling, if you are distracted, you can’t be best for your customers. They lose and you lose.
So, start committing to permanent profits. Every transaction with every customer must be profitable. Your customers want you to be profitable almost as much as you do.
Meet Rachel and Kyle, founders of The Wright Wellness Center. Watch the video to see how the implementation of Profit First transformed their business operationally AND enabled them to better serve their purpose of helping couples build stronger relationships. If your business struggles with profit, there is a path forward. Learn about this proven system in the book here: Profit First Book on Amazon.
There is a lot happening in the Boston restaurant landscape. It seems that restaurants, places we have loved for years and places we haven’t even had the chance to try out yet, are closing their doors. Some say it’s the ridiculous and ever-escalating Boston rents, some say Millennials are to blame, but in either case – complaining never pays the bills. This article, with the help of some of Boston’s Top Restaurant Influencers and Experts, is meant to be a helpful outline, or guideline, to those brave souls who still venture to enter this tumultuous, yet passionate, marketplace.
HOW DO I MAKE MY RESTAURANT MORE PROFITABLE?
1. The Food. There is no avoiding the importance of food in a restaurant’s success. It may not be the only thing – but it may be the most important thing. After all, it is the reason your guests will leave the house in the first place. Ensure that you have a chef/kitchen manager whom you can trust, who can run a team which can prepare food in a timely manner, with consistent quality and presentation. In addition, our contributor Restaurateur Matt Sullivan (www.ackprime.com) adds that it is important not to put all your “chef eggs” in one basket… meaning be prepared to be able to execute your menu with a new chef/kitchen manager, thus, systems and recipes are a must. Make sure that the menu is not too long, to ensure you have the freshest food, and keep inventory of perishables down. Invest in quality ingredients, it is the only way to ensure a superior product is being provided to your guests. The execution of the food served is also extremely important and can be ensured by a great expeditor. If “all things food” is not addressed, there is little point in going on to the next points.
2. Location and Demographics. Invest in a good realtor who is an expert on locations and demographics in your city. What kind of demographic are you looking to attract? Where does that demographic live in your city? What do they like to eat? If you are looking to serve urban professional hipsters, find out where a Whole Foods has opened recently, (why not piggy back on Wholefoods’ first-rate demographic modelling?). If you are looking to open a New York style Steakhouse serving wealthy baby boomers, find out which part of the city buys the most Cadillacs. A top-class realtor, such as our Contributor Charlie Perkins of Boston Restaurant Group, (www.BostonRestaurantGroup.com) must have an authoritative grasp of these facts. Charlie tells us to have your concept solidified first, then set about looking for the right location. Charlie also shared that 65% of all restaurant openings are quick-casual concepts – which speaks to the Millennial demographic who aren’t out to get the traditional “3-course” meal but prefer a drink and to share a few appetizers. Another great, possibly business-saving tip, from Charlie is when working on your budget, your total Occupancy costs should be no more than 8% of gross sales. Those restaurants with higher Occupancy costs tend to struggle and most often fail. And then there is thinking forward, way forward and down the road of possibly selling, and the 3 things that make the sale value of a restaurant are, at least in Boston, location, license, lease… so it will literally pay to think ahead on these things. And here’s an old school tip… if you find a location you think might work, spend a few hours, at different times throughout the day, parked at a nearby business and study who and what happens in that area.
3. Financial Foundation. This is key. Setting up your financials, your cash flow, your “books”, correctly and accurately from the beginning will save you in almost every way. After all, if you don’t know your numbers, you don’t know your business. The Profit First Cash Management system is the best at absolutely ensuring profitability from the very first deposit. In the restaurant business, you generally have no idea how much sales your establishment can bring in on any given week… there could be snowstorms, school holidays, power outages, large televised sporting events, so many variables that can affect sales. But, in the end, the restaurateur makes it work. So, whether you bring in $15,000 a week or $25,000 a week in sales, you make it work because there is no other option. Setting up a cash management system from the get-go where profit is taken first off of every deposit, then Owners Pay, then taxes, sets up the Operating Expense account that the restaurant has to manage with… and guess what? They’ll manage.
4. Website. Over the years, we have worked with dozens of restaurants which have committed over a million dollars in renovating their property but have opened without a website being live or updated or useful! The fact that this still happens in 2019 is remarkable. Our Contributor Honor Lydon of BostonChef.com (www.BostonChefs.com) shares that you must have your press kit ready to go, BEFORE you open the doors. If you wait to do it after, or when someone asks for this info, after you’ve opened and are in the thick of it, then it won’t get done. Or it certainly won’t get done well. And this is important because having a strong identity in a world filled with so many dining options, is imperative. Honor highly recommends getting your website together sooner rather than later, having headshots, recipes, and food photographs at the ready so when people reach out who want to talk about your restaurant, they can do so eloquently and accurately. In the grand scheme of things, a website is relatively inexpensive, with a high-quality one available for between $2,000 and $5,000. The revenue driven by the website will be ten times the outlay and is crucial to driving revenue, so do not scrimp on the cost with a part-time nephew or friend, or one of those “free” website platforms who might not have you live at least a month before opening. Choose a professional, and better still one which specializes in restaurants.
5. Great Concept. A disproportionate number of the most successful new restaurants are profitable because they give the dining public what they want, in many cases before the public know they want it. Some restaurateurs are just great at predicting new trends, but one thing we can state after 20+ years in the business, is to repeat that old adage “there is nothing new under the Sun”. Even the most exciting American chefs borrow from the Spanish, French and Italian masters. If you are stuck for some inspiration, why not spend a week in New York, San Sebastian or London, three of the most Avant Garde food cities. See what is really clicking there, and the chances are, in a year or two it will be popular in your city too.
6. Overestimate your Capital Requirements. From experience we have seen restaurants spend over a million on renovation, only to shutter within six months. Why? In nearly every case, the restaurant assumed it would break even as soon as it opened; or the build costs were higher than expected, and the reserve fund for the first six months was used up for the build. Either way, the bottom line is that it is common for restaurants to underestimate costs and actually go bust before they have really hit the ground running at six months. Make sure you have enough capital in place for the build, start-up costs, a loss for six months, and some extra for unexpected events… ALWAYS. Our contributor/restaurateur Matthew Sullivan recommends adding 40% on top of what you “think” the budget might be… if you’re estimating $100,000 in start-up/building funds, have $135,000 or $140,000 in the bank… you’ll need it.
7. Ensure Sufficient Two-Top Tables. The cardinal sin of most architects is completely ignoring economic reality when designing floor layouts. The fact is, the most common party size in fine dining restaurants is two, followed by four tops. Even more important, two-tops tend to have a higher spend per head, and a shorter turn time, which means they earn far more per hour. It is incredibly common for restaurants to have banks of large tables and booths, and a relatively small number of two-tops, often situated in the least hospitable parts of the restaurants. The result is that most restaurants will not sit two-tops at a six-person table, thus causing a wait which then gives the reputation of being a place where there is “always” a wait and guests may decide to go elsewhere before even trying to see if a table is available. To ensure the profitability of your new venture, remember that you will probably get more two-tops than any other party size, they will spend more per head, and be in and out relatively quickly, so ensure plenty of two- tops, and that some of these are in nice locations, like beside the window (and not near the bathroom or kitchen door). Finally, it is easy to combine several two-tops into a larger table, but you cannot split a larger fixture like a booth between two or three parties.
8. Accept Reservations. If your restaurant is full service, reservations are a must. Not only are they requisite for the guest experience, but they are highly effective for the operator as well. Walk-ins tend to come in large lumps, around 7pm for example, or Sunday Brunch at 10am. A well-planned reservation system is far more effective at smoothing the loading of diners over the whole shift versus walk-ins, which improves food and service, consistency, the guest experience and your profit. OpenTable is still the leader in online reservations but it is also a great CRM (customer relationship manager) software. While not cheap, you can absolutely make your money back and then some by utilizing this tool to its capacity.
9. Invest in a Lead Host. In Europe and New York, it is not uncommon for the best-paid member of staff to be the Maitre’d. And why not? It is the most intellectually vigorous position in the restaurant when done correctly. Yet in many American restaurants, the host team are the least well-paid members of the staff. It is crucial to have one person beside the door who knows what they are doing. Invest in a well-paid, experienced lead host or reservations manager, who understands the importance of maximizing reservations and walk-ins, and is incentivized to manage the floor in a profitable way for your business. In many of the most successful restaurants, the GM or restaurateur takes on this role themselves, but we would recommend having someone else take on this role so that the GM and restaurateur are free to engage the guests.
10. If you are New to the Industry, Open with a Restaurant Consultant. Restaurants have an incredibly high failure rate, and if you have never owned a restaurant before, the learning curve is painfully steep. Working with an industry veteran can smooth the curve and reduce the amount of your savings/investment which is burned approaching break-even. Be wary of some “consultants” however, as many are failed restaurateurs, who failed for a reason. Always check references, plus their successes and failures. If you are not sure where to find a consultant in your city, why not call the five restaurants you most admire locally and ask them to recommend someone? Or better yet, contact BostonChefs.com and see who they might refer too. Most will be happy to help, and cross-referencing their recommendations is useful. Better yet – build a Team! This article alone includes 4 industry experts that can help you on your way to restaurant stardom. Don’t be afraid to reach out – while this industry can be competitive, we all want to add great places to our dining landscape and thus the comradery far outweighs the competitiveness.
Let’s meet the Experts…
First up, Matthew Sullivan. Matt is one of those “fixture” restaurateurs that you might see at random bars about town – but in a good way! He has owned and managed restaurants in several of the different Boston Neighborhoods. Matt has run the full spectrum of the “dive bar” outside the Garden in downtown Boston to quite the chic-chic “ladies who lunch” dining establishment in a very wealthy suburb. Today, Matt splits his time between his longtime restaurant in Milton’s quaint downtown, Prime Milton, and the Island of Nantucket where he’s entering year three of a very successful tenure at his island steakhouse, Nantucket Prime. https://www.primemilton.com/ https://www.ackprime.com/
Next, we have Honor Lydon, co-founder and Executive Editor of BostonChefs.com. BostonChefs.com is THE hub for all things’ restaurant in and around Boston. It is a digital marketing network that connects chefs, diners, and brands through a shared passion for food and drink. Their platform provides insider coverage of the local culinary scene to an audience of food-lovers. In addition, BostonChefs.com enables independent, chef-driven restaurants to reach engaged and passionate diners, provides brands a platform to connect with their audiences in the context of content they are passionate about, and connects the best industry talent with jobs at the top restaurants in the region. https://www.bostonchefs.com/
And last but not least, the famous restaurant broker-guru, Charlie Perkins, of Boston Restaurant Group. Founded by Charlie in 1990, The Boston Restaurant Group, Inc. is the commercial real estate firm that specializes in selling restaurants, leasing restaurant space, appraisals, and management consulting. Charlie is a frequent speaker on subjects relating to Restaurant Valuations and Opening a Restaurant and I am thrilled that he has generously participated in this article. http://www.bostonrestaurantgroup.com/
Oh wait, one more, then there is me…Kasey Anton, restaurateur turned bookkeeper turned Profit First Professional. I have had the opportunity to work in all kinds of restaurants since I was 14 years old, in every position, and loved every second of it. My lifelong goal as a child was to open my own restaurant one day and, with the help of 2 partners, I did just that in 1999 with the opening of my first restaurant, Bomboa, located in between the Back Bay and South End of Boston. But as all good things must come to an end (especially in the restaurant world), I sold Bomboa in 2006 – the year I had my first child and decided that 4:00AM closings weren’t in the cards for me anymore. From there, I began helping other businesses, restaurants and others, get their finances straightened out and create a solid financial foundation for these businesses to grow. I was introduced, via audiobook, to Profit First on my honeymoon in 2017 and knew within the first few minutes that this was the solution for so many of my clients – especially our restaurant clients – and it has been my mission ever since to work with our clients to help eradicate restaurateurial poverty. https://sparkbusinessconsulting.com/