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post #31 of 43
piob could you post the link please, thanks is it this http://forums.winespectator.com/eve/.../319106213/p/1 ? http://forums.egullet.org/index.php?...ant-in-philly/ here;s another thread i found
post #32 of 43
Ask away, Piob. I'm your man. I've been on the opening team of two restaurants, although never with a business interest in the place. But one was my best friend and we've talked a lot about what it's like.
post #33 of 43
Thread Starter 
Quote:
Originally Posted by Matt View Post
OIC. When we were looking into this a couple years back, these were the areas of risk that I really did not like at all. You are highly likely to be tossing a lot of wine out just cos one guy thought it might be good to try once.

You create a set menu of wines that are by the glass; not every wine in the house will be sold in this fashion. The art/skill is to create the WBTG menu that renders the least waste. You can figure about 48 hour shelf life for an open bottle. If there is some left, you let staff taste it to further their education of your product and you can also give free tastes to patrons to stimulate sales of that wine. Also carry the entire WBTG list in your retail outlet and thus stimulate bottle sales in the home market. So while you might have to take a hit on a partial bottle, you can put it to a couple of uses (also can give to kitchen for cooking). But like I said, the goal is to create a WBTG list where your waste is minimal.
post #34 of 43
After running my 76 seat restaurant for 5.5 years, I'm back working as a CPA and have hired a f/t manager to run my wine bar and would consider selling it to a chef/owner.

Too much work for too little return, imho.
post #35 of 43
Thread Starter 
Quote:
Originally Posted by cuffthis View Post
After running my 76 seat restaurant for 5.5 years, I'm back working as a CPA and have hired a f/t manager to run my wine bar and would consider selling it to a chef/owner.

Too much work for too little return, imho.

Sorry to hear this. Was there a tipping point for you? Do you feel it's inherent in the industry or would a different format be either more profitable or less work?
post #36 of 43
Quote:
Originally Posted by cuffthis View Post
After running my 76 seat restaurant for 5.5 years, I'm back working as a CPA and have hired a f/t manager to run my wine bar and would consider selling it to a chef/owner.

Too much work for too little return, imho.
very sorry to hear it Tom.
post #37 of 43
Wow, that sucks Tom. Good luck with the sale.
post #38 of 43
Quote:
Originally Posted by Piobaire View Post
Sorry to hear this. Was there a tipping point for you? Do you feel it's inherent in the industry or would a different format be either more profitable or less work?

Wine bar has always been profitable, even during the last few years.

But it simply doesn't generate enough cash flow for me to service my $750k personal mortgage and have money left for fun.

I still love it and work 25+ hours there, plus 50+ as a CPA. I'd like to have a life again though.........

We pay chef market rate wages + generous bonuses. The combination of his total compensation + business net profit make it a great deal for a chef/owner. It's not a great deal for me when I only get net income, plus small salary.
post #39 of 43
Thread Starter 
Quote:
Originally Posted by cuffthis View Post
Wine bar has always been profitable, even during the last few years.

But it simply doesn't generate enough cash flow for me to service my $750k personal mortgage and have money left for fun.

I still love it and work 25+ hours there, plus 50+ as a CPA. I'd like to have a life again though.........

We pay chef market rate wages + generous bonuses. The combination of his total compensation + business net profit make it a great deal for a chef/owner. It's not a great deal for me when I only get net income, plus small salary.

Gotcha. Thanks for the insight on that. Based on this, very pertinent question: do you think it could survive/thrive without a full menu? I've read your menus and they sound fantastic. But do you think a similar business could survive with more nosh type items, i.e. cheese, charcuterie, etc. so that you would not need a full blown chef? In my local market I know experience chefs are making 65+k so imagine your market is probably similar.

There was a place that opened in my locale that sounded very similar to yours. It ended up going out of business after about 2.5 years. The same time that opened, a very inferior wine bar (in terms of staff knowledge, wine list, WBTG, etc.), and it only had nosh type food. Five years later and it is still going although I find the place a disappointment.
post #40 of 43
Quote:
Originally Posted by Piobaire View Post
Gotcha. Thanks for the insight on that. Based on this, very pertinent question: do you think it could survive/thrive without a full menu?

No, I strongly believe that the key to our survival is the quality of the food.

Wine is ultimately a compliment to food. Whithout quality menu items, it's just drinking, which is not my focus.

Our avg/cover is about $50/pp (before tip). I know thats a lot in this economy but its what our customers ask for.

I love the concept of a wine bar with simple food, kind of like a neighborhood ale house. Tria in Philadelphia does this VERY, VERY well.

However, IMHO our market in Wilmington, DE is too small to support this. We would have to do 150-200 covers/day to generate the same revenue we do with 75-100 covers per day as a full-fledged restaurant.
post #41 of 43
I have a few friends who are successful restaurant owners. (One has been on the same site for 30 years now, several refurbs, turnover just keeps going up.)

I've tried over the years to analyse what makes some work and the majority fail. (I had five years in retail management at the start of my working life and have been part owner in a music venue).

Seems to me that as well as luck, the main criteria appears to be generating a buzz about the place with the local populace. There's the majority of the marketing done right there. TBH, the buzz is very rarely to do with amazing food (Michelin starred places excepted), although it will have to be fairly consistent. I've always preferred the exact opposite as a diner, great food, not that bothered about the decor etc. Everyone who has gone that route here in Mcr. has pretty much failed. Fine dining has died a death here, not one Michelin place in the city centre. People who will spend £80 on a night out drinking would baulk at the idea of spending half that on a meal...

More to do with being the place to be. There's an Italian in town (that is on the site of a previously failed resto), that is one of the busiest in the whole of the UK. Turnover above six million a year. I'm not a fan of the place, went several times when it first opened, food ok, pushy waiters etc. It's cornered the market in 'ladies that lunch' and 'power meetings'. It generates a lot of divided opinions, but as a business you can't fault it.

Another friend opened up next door to a well established restaurant that had been trading for twenty years when he moved in. Soft opening, loads of promotional activity via email, website etc. Now has one of the busiest places in town and has opened another very successful place in conjunction with two partners. The established place started to die (even though their food was better) and they had to have a rethink. They now do far more marketing etc.

A vegan place has just opened up with an ex Nomu head chef. Already fully booked every weekend, just extended their weekday evening opening times. Absolutely no competition in that sector for several miles. If somebody else copies them nearby it will be interesting to see whether the local market can support two places serving such a narrow niche. Personally I'd doubt it.

The amount of tourism will affect the mix quite a lot. London can support fine dining and diversity so well because of its worldwide number one tourist destination status. Edinburgh the same. In fact a Michelin starred chef re-located there from the outskirts of Manchester specifically to chase tourist money in his quest for a second star.

So conclusion. Study the local market and don't think you can buck the trend unless there is strong tourist revenue. All IMHO.
post #42 of 43
Pio - Here is a link to Example 1's website. Just so you can get an idea of what I'm talking about. http://www.theblindmonk.com/
post #43 of 43
Two secrets to the food service industry: Velocity + margin = duh, winning. You must have high traffic that turns quickly. You must work ferociously to reduce costs and jack up pricing wherever possible, but in nonobvious ways (the Slate article's example of the 15-cent cup of coffee sold for $3.50 is a great one). These things are not the difference between breaking even and doing really well; they're the difference between going bankrupt and breaking even. It cannot be overstated how tough the food service business really is. Also needs to be stated that you'll never get rich off of a coffee shop. A chain of coffee shops, maybe, but good luck with that in this oversaturated market. Restaurants are bigger bets with more upside, but they're also high-risk. Especially in the upscale segment. If I were going to enter the food sevice industry these days, I'd do it as a food processor and/or wholesaler to coffee shops. Land a Starbucks account, and ka-ching. There are billionaires out there, of whom most people have probably never heard, who made their fortunes selling to fast food chains. The guy who invented the clamshell-style Big Mac container (and secured exclusivity with McDonald's) is worth well north of $1B. I would honestly look into inventing some sort of environmentally friendly, patentable food packaging system. Whoever invented those biodegradable plastic utensils made from potato starch -- the ones quickly becoming ubiquitous in corporate cafeterias these days -- is probably cleaning up.
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