On Wed 27 Aug 2008 04:57:27p, Gregory Morrow told us...

>
> http://www.nytimes.com/2008/08/27/dining/27fail.html
>
>
> August 27, 2008
>
> Love Food? Think Twice Before Jumping In
>
> By MICHELINE MAYNARD
>
> "WHEN Linda Lipsky taught a course called "So You Want to Open a
> Restaurant" at Temple University in Philadelphia, she deliberately made
> the business sound like a minefield. She warned her students that it is
> possible to lose their homes, their life savings, and even the rights to
> their own names. Her goal, she said, was "to get two-thirds of them to
> quit."
>
> In fact, two of every three new restaurants, delis and food shops close
> within three years of opening, according to federal government
> statistics, the same failure rate for small businesses in general. "It's
> very easy to fail if you know what you're doing, and even easier if you
> don't," said Ms. Lipsky, president of Linda Lipsky Restaurant
> Consultants, a firm based outside Philadelphia that has advised
> restaurant owners and chains for 20 years.
>
> While restaurants have long been a dream for the hospitality-minded, the
> industry has never had such a high profile, thanks to the Food Network
> and celebrity chefs whose restaurants have become launching pads to
> marketing empires.
>
> The allure is easy to understand, said Peter Rainsford, the vice
> president for academic affairs at the Culinary Institute of America and
> co-author of "The Restaurant Startup Guide."
>
> "So many people love to cook, they like food, and they think, boy, I'll
> have a job where I'll do what I love," Mr. Rainsford said. "They don't
> realize how hard a job it is, both financially and physically."
>
> Charlita Anderson learned, but it was a painful and expensive education.
> Ms. Anderson, 47, went to law school at Cleveland State University, and
> has worked in the legal field for 20 years, most recently as a judicial
> magistrate in suburban Cleveland, hearing cases involving juvenile
> crimes and traffic violations. But she always longed to run a restaurant
> that would feature her mother's recipe for gumbo, a family favorite.
>
> So in 2002, she opened Pepper Red's Blues Café in Lorain, Ohio, a Cajun
> restaurant and nightclub. She did everything at the cafe, from making
> gumbo to scrubbing the floors and singing torch songs, while still
> putting in a full day as a magistrate.
>
> Today her restaurant is no longer in business and she is back to her
> previous career, where she has paid off the debt she incurred during her
> 15-month foray into the hospitality business.
>
> Ms. Lipsky has repeatedly seen restaurant novices make the same costly
> mistake: vastly underestimating the money it will take just to break
> even. She counsels them to have enough money to cover every aspect of a
> business for the first six months, including food, salaries, benefits,
> kitchen equipment, rent and utilities.
>
> Indeed, Barry Sorkin and his four partners were well aware that the odds
> were tough for Smoque, a Texas-style barbecue joint they opened a year
> and a half ago on the northwest side of Chicago. But they were
> determined to beat those odds, with both research and financing.
>
> The partners - Mr. Sorkin; two former co-workers at a technology firm;
> his uncle, who works in the building materials business; and a lawyer -
> were all barbecue fanatics who frequently met to grill in each others'
> backyards. They spent more than a year analyzing the business.
>
> Mr. Sorkin quit his job in 2005, and visited restaurants all over the
> country, including North Carolina and Memphis. (His wife supported the
> family while he traveled, before the restaurant opened and he started
> taking a modest salary.)
>
> After tasting samples, the partners settled on Texas barbecue, known as
> "low and slow" because it is cooked at a lower temperature for a longer
> period than other styles. It was a variation they felt had been
> overlooked by Chicago's numerous rib spots.
>
> Mr. Sorkin, who has a degree in journalism, wrote a detailed business
> plan that ran for more than 40 pages, comparing his concept to the menus
> of his potential competitors. It featured a heartfelt essay, "Our View
> on 'Q," that set out the group's philosophy on barbecue; a version of it
> is posted at the restaurant's Web site, www.smoquebbq.com.
>
> Along with a simple menu of ribs, brisket, chicken and side dishes like
> macaroni and cheese and twice-cooked fries, the plan also included an
> extensive analysis of the expenses the restaurant expected in its first
> three years.
>
> Determining that the North Side of Chicago lacked sufficient rib
> outlets, the group zeroed in on a storefront on North Pulaski Road,
> about 15 minutes north of the Loop and 10 minutes from Mr. Sorkin's
> house.
>
> Two members of the group pledged their homes to secure a $440,000 Small
> Business Administration loan to get the restaurant off the ground.
>
> In the months just before and after Smoque opened, Mr. Sorkin and one of
> the partners spent 120 to 130 hours a week tying up loose ends. "I
> seriously thought we were going to die of exhaustion," he said.
>
> Since Smoque opened, Mr. Sorkin has scaled back to a relatively relaxed
> 90 hours a week. Now, he is at work by 7 a.m., for a day that starts
> with stocking wood in a smoker, accepting an order from a meat
> deliveryman, checking the previous night's receipts and supervising as
> kitchen assistants chop peppers and prepare peach cobbler. He is on his
> feet all day, and rarely gets home to see his two toddlers before their
> bedtime. He can only occasionally catch a beer in a bar near his house.
>
> But he is not complaining, because Smoque has served many more customers
> - thousands more - than the business plan forecast.
>
> "My old job was challenging, even interesting at times, but I never got
> the same buzz from knowing that someone got their e-mail fixed," Mr.
> Sorkin said. "I love barbecue. I love to feed people barbecue, and I
> love to watch them enjoy it."
>
> Ms. Anderson began in a far less ambitious way, relying on her family's
> encouragement far more than on financial planning, a step that Ms.
> Lipsky said often proves fatal.
>
> Her suburban Cleveland cafe was named after her late uncle, whose
> nickname was Pepper, and her father, dubbed Red. The cafe was the
> culmination of her lifelong dream to gain more exposure for her mother's
> gumbo, a recipe handed down from generations of cooks in Louisiana and
> Mississippi.
>
> "People who have tasted that gumbo say it's the best this side of New
> Orleans," she said. "It's a big deal in our family."
>
> Still working as a magistrate, she began to shop for a location in
> downtown Lorain, a working-class town, in 2002. Ms. Anderson chose a
> former Woolworth 's store about 40 miles from Cleveland on the shores of
> Lake Erie, on the hope that long-rumored casino hotels would soon be
> built.
>
> Ms. Anderson also felt that local residents, who had few options to hear
> live music, would patronize a club in their collective backyard rather
> than drive into the city.
>
> Even an economic slowdown that gripped the area after Sept. 11, 2001,
> did not deter her, because, she figured, "people have to eat, they want
> to be entertained."
>
> She had a truly secret recipe in her mother's gumbo. Her mother, Claudia
> Anderson, who had never shared her methods with her daughter growing up,
> required that she learn the gumbo recipe by heart and make two batches
> from scratch, without help, before she would agree to let her offer it
> on the menu, which also featured Southern classics like red beans and
> rice, cornbread and crawfish.
>
> Meanwhile, family members, including her husband, son and a flock of
> relatives, volunteered to work there, meaning she had to hire only one
> employee, a waitress.
>
> But before the cafe opened, unexpected costs appeared. To pass
> inspection, the restaurant needed doors that pushed outward so customers
> could easily exit. The two doors each cost $1,000. Toilets for the
> restrooms arrived with no seats.
>
> "The tiny little things you don't even expect, they're going to pop up
> at any time," Ms. Anderson said. She was responsible for every detail.
> "I went from a highfalutin position to scrubbing the floors," Ms.
> Anderson said.
>
> The summer after the restaurant opened in May 2002 was promising. Acting
> as the hostess, Ms. Anderson rushed every evening from the courtroom to
> the cafe, where she tied a custom-designed apron over her business
> clothes to seat the guests.
>
> Ms. Anderson, who is not a trained musician, learned to sing blues songs
> and regularly took a turn on the bandstand. "It was the most fun I ever
> had, notwithstanding the stress," she said.
>
> But the joy did not last long. The hotels did not open, and by fall, the
> crowds that she anticipated would fill the restaurant every night had
> thinned. The friends she expected would be her regulars were often
> missing. "People will encourage you," she said, "but they won't show up
> every night."
>
> Ms. Anderson, who had borrowed $17,000 in a small business loan, fell
> deeper into debt.
>
> Despite a bump during the 2002 holiday season, her business dried up
> over the first winter and did not rebound to her first-year level the
> following summer. Ms. Anderson did not have enough money coming in to
> cover the rent, $1,000 a month, and she could no longer afford to keep
> on her employee. In September 2003 she decided to close, a move that
> left her depressed and embarrassed.
>
> "How could someone with a law degree and as smart as you blow it this
> big?" Ms. Anderson said she asked herself. But she ultimately decided
> that it was better to be realistic. "You have to appreciate that this
> might not work," she said. "If it doesn't, get out."
>
> Ms. Anderson's experience is far more typical than Mr. Sorkin's, said
> Mr. Rainsford. He should know. For five years, when he was a professor
> at Cornell University's hospitality school, Mr. Rainsford ran a
> restaurant called O'Malley's on a lake just outside Ithaca, N.Y.
>
> Mr. Rainsford and his wife soon discovered that the restaurant was not a
> sideline to his job, but a full-time undertaking for the entire family,
> especially during the summer. Eventually tiring of the disruption to
> their routine, and with their children losing interest, the Rainsfords
> sold O' Malley's to a young couple for a small profit.
>
> The experience has helped him give advice to students at the culinary
> institute, where about half are traditional undergraduates and the rest
> are older students, many of whom have changed careers or want to enhance
> skills they have picked up on the fly.
>
> Many of those students have a romantic vision of life in the food
> business, he said, fed by the success stories of people like Ina Garten,
> known as the Barefoot Contessa, who was a White House budget analyst
> before buying the shop in the Hamptons that started her food career.
>
> Back in Ohio, former customers still rave about Ms. Anderson's gumbo.
> She often passes the cafe, now reopened under new ownership and with a
> new name, on her way home from court.
>
> Each time she passes, she said, she is tempted to give the restaurant
> business another try. "But then I just keep driving, and I say to
> myself, don't look, don't look, don't look."
>
> </>
>
>
>

I should have thought with her background and experience that she woule
have known that Lorain, Ohio is probably one of the worst choices to open
a new restaurant. Having lived most of my life in the greater Cleveland
area, I can't think of a much worse location than Lorain.

--
Wayne Boatwright

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Date: Wednesday, 08(VIII)/27(XXVII)/08(MMVIII)
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Countdown till Labor Day
4dys 5hrs 57mins
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Make a fortune: open 'Rent-A-Heart.'
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