Clark County restaurants have seen a tremendous amount of transition the past three years. Cami Joner’s article in the Sunday edition of the Columbian tilted ‘Owners of Eateries- Tough Calls” calls attention to a small sample of the most recent examples of what has been happening by sharing the stories of Scott Dickinson of KFC, Peter Gallin of Applewood, and the Condon family who own Steakburger.
She rightly points out that even in up economies it is tough gig. Operators work long hours, have a never ending stream of new competitors, both local, and national in scope. Trends change. Scott Dickinson listed this as one of the reasons that his sales had declined over the past several years. If you’ve got a significant investment and customer base – it can seem risky to try and change too quickly.
Bill Hayden, long time restaurant operator and consultant says he sees restuarantuers as romantics… they love the industry, and it is a good run if they can make it five years.
I’d have to agree with him on both those points. There are resources available to restaurantuers as well as the general public when challenges arise in their business or even before.
Reach out to Score, the SBDC or the Washington Restaurant Association prior to opening during your business planning phase, or as soon as you feel the trend slip.
Restaurant operators have such slim margins they often get trapped into just working a job, and they are unable to develop a marketing effort, to rebuild slipping sales. Once a downward trend starts it is difficult to shake.
The most critical time may be the start up phase. Too many operators don’t do enough homework on their Lease and the costs involved. They don’t make the calculation to determine how much in sales they will have to generate each and every day for the entire term of the Lease to stay in business. Those opening weeks can make them feel they have it all handled. As a very simple rule of thumb – whatever your total lease payment is- multiply by 12. That is the monthly sales you need to do to consistently have enough cash left over as profit.
We at Coldwell Banker Commercial can help with that step.