Food businesses can be a rude awakening

Salary, unsold inventory ...  HELP!

I worked in hospitality for 7 years and I have absolutely no illusions about how tough a business it is.

First off, you work insane hours. You need to buy your produce, and prepare it, often in the wee hours of the morning. You also work 6 days a week and will often be working 12 hour days. There is basically no time for work life balance.

You may enjoy dinner parties and entertaining people but that skill set doesn’t translate into running a business. Diner’s expectations are set by how much time they have, the cost of the meal versus the quality, prompt and polite service, convenience of location and parking, etc.

The idea that you can hire a professional manager just doesn’t work. First, they will try to run the business as they see fit, but they are spending your money not their own, so they won’t get it. Secondly and most importantly, there are not enough margins in the business to pay for a manager. You are it – now get over it.  

You may be able to get someone to be a supervisor for busy shifts, but that’s it.

Fast food is even more brutal. Think about places that sell sandwiches or similar in the middle of town. A lunch service is about an hour and a bit, and for places in the central business district there are only 5 trading days a week – that means that you need to make most of your money in 5-8 hours each week.  Efficiency is key.  That’s why there is a lot of pre-prepared meals out there, and where food is made up the most successful business (e.g. Subway) have an assembly line.

If you are making coffee to attract customers, make sure that you still have some staff just selling the ready made goods and not coffees. I have seen a lot of lost sales in fast food where customers who came to buy the main product walk off in disgust when they have to wait for 10 minutes to buy something that would take 10 seconds to transact just because all the staff are making drinks.

When you first open you will get more customers than the long term average. People often go somewhere new for the novelty of it all. They will soon find somewhere else, so don’t build your business around this honeymoon period.

Don’t get me wrong, hospitality can be very rewarding on a personal and monetary level, just understand what you are getting into as the establishment costs are very high. It is hard to stay afloat when you are learning about the business from the beginning and your loan and salary payments are much higher than your earnings.