Three thriving chefs share some secrets about their success.
THE SECRET INGREDIENT
Before opening a restaurant, it is important to be fully aware of the challenges you will face in this intensely competitive business.
BY FRANCESCA DI MEGLIO
Celebrity chef Michel Richard used to sleep on the floor of his first restaurant, which he opened in LA in 1977, because he had so much work to do. He says he was young, passionate and determined. If he wanted to make it in the restaurant business, he didn’t have much of a choice.
Indeed, the restaurant business is not for the weak or faint-hearted. Even though the oft en touted statistic that 90% of restaurants fail in the first year was recently debunked by a researcher in Columbus, Ohio (who studied the industry in Columbus and found the statistic was highly exaggerated and that restaurants often close for reasons other than economic ones), no one denies that it’s a tough industry in which to find success.
“The margins are slim,” says Anne Quatrano, who runs Atlanta’s Bacchanalia and two other restaurants with her husband and fellow chef, Cliff ord Harrison. “Most businesses are service oriented or they manufacture something. In our business, you manufacture and serve.”
Still, sales in restaurants were upwards of $537 billion in 2007, according to the National Restaurant Association. With 935,000 restaurants in the United States, the industry employs 12.8 million people, making it the largest employer besides the government. What’s more, Americans spend 48% of their food budget in restaurants.
Snagging a piece of that pie is tough—but not impossible. Those who learn the tricks of the trade have created empires—think Rachael Ray and Emeril Lagasse. And even chefs and businesspeople without TV shows and cookware lines have managed to carve a niche for themselves.
Richard, who is chef/owner of Citronelle in Washington, DC, will tell you that passion is a necessary part of making it in the business. Without it, you won’t have the motivation to carry out the many duties required of new restaurateurs. To hear industry insiders tell it, you can only keep up with the tireless hours required in the industry if you truly love what you’re doing.
“You get really tired all the time,” says Kenny Lao, co-founder of Rickshaw Dumpling Bar, which has two locations in New York City. “All I think about is bed. Get a lot of sleep before you open.”
WORK UP AN APPETITE
Passion isn’t always enough.
Experience helps, too. To understand fully the business, you need to know food and service, recipes and financials. “Owning a restaurant is not rocket science, but there is an art to it,” Lao says.
To get experience, experts suggest working for other people first. Quatrano started working in restaurants when she was 17 years old. She says she learned the ropes in restaurant management before she went to cooking school in the early 1980s. This helps her choose and train employees and balance the yin of the hosts up front with the yang of the kitchen in the back.
Working for someone who is opening a restaurant with his money or an investor’s money is a great way to get a feel for the business without losing your own shirt, Quatrano says. She adds that this is a good way to get your feet wet and see how much work goes into launching a food-service start-up—and what little glory you receive.
Then you can decide whether you still want to dive in.
WHAT’S ON YOUR PLATE?
A common cause of failure in the restaurant industry is that foodies and chefs are not oft en business-minded people, and they lose track of the finances. Halvorson says that owners must keep an eye on the cash everyday or risk going bankrupt. According to Richard, finding a place with reasonable rent (one that is not more than 6% of your profits), especially in the early, leaner years, is an important first step in handling your budget.
Avoid borrowing too much money, and consider bringing in a partner or investors to back you up. If you choose to bring in a co-owner or co-chef, choose someone you work well with and who complements your skills, Lao says. “If you know numbers, they need to know operations,” he adds. If you don’t see eye to eye, you run the risk of going the way of Rocco DiSpirito’s restaurant, Rocco’s on 22nd Street, which closed aft er irreconcilable diff erences between the chef and his partner, Jeff rey Chodorow. (The eatery and feud was the subject of NBC’s reality series “The Restaurant.”)
Saving money is on the top of most owners’ minds. Quatrano faces a constant battle to control waste. One of her tactics is to continue to buy the best produce— but use every last bit of it. It goes without saying that the food you serve should be delicious and made with quality ingredients. If the food doesn’t bring in the customers, a restaurant owner might as well close up shop from the start.
Profitable restaurateurs never forget who the boss is. “You never work for yourself,” Quatrano says. “You are working for the person in your dining room.” If you’re a people-person who wants to satisfy and nourish your customers, you’ll have a better chance of succeeding in the restaurant biz. After all, as Richard says, “Love is the secret ingredient to success.”
TAKE A SMALL BITE
Once you decide you like this line of work and have gained enough experience, you can start looking for your own restaurant. But Richard says you should think small. It’s easier to learn from your mistakes at a small place, which is more manageable and keeps costs down. Location, Richard says, is also important. Sweet spots for restaurants include anywhere that is easily accessible by metro, bus, cars and on foot, says Carl Halvorson, director of food and beverage at Citronelle. He advises new buyers to ask friends what they think about the location’s convenience. Ideally, aspiring restaurant owners should seek out locations that are not already teeming with competitors serving the same kind of food.
Once you’ve found a location, think about what you want the restaurant to look like. The décor should be as pretty as it is practical. The interior should be eye catching and follow your restaurant’s theme—a 1950s diner, for example, should have a jukebox and swivel stools at the bar—but your waitstaff should still have ample room to walk and carry trays full of food. When looking at the plans for your space, consider the layout of the kitchen and its location in relation to your guests. Will chefs be able to prepare the food easily in the kitchen? Will the waitstaff be able to quickly move from the kitchen to guests and back again? Or do you want an open kitchen, where guests can see the chef in action?
The look of your restaurant will serve as a constant advertisement for your menu and services. The storefront should be welcoming: a neat logo or sign and a fresh coat of paint are musts. One of the most important things is to keep the space clean; unwanted guests, such as rodents and bugs, can close you down for good. Also, a clean restaurant assures customers of the quality of the food you are serving them.