Will your friendly neighborhood restaurant be around next month?
The restaurant business is not for the fainthearted.
First there is the whole idea of starting one. A Google search for “how to start a restaurant business” gives 485,000 results. Sites with names like “www.startarestaurantbiz.com” or “www.how-to-start-a-restaurant.com” provide advice to budding restaurateurs. And while they talk about creative satisfaction and how people like to eat out, they also emphasize heavily on a business plan. This article from Forbes, although 4 years old, still gives an idea of the costs of starting a restaurant.
At the end of the day, a restaurant is a business. Running it is tough work, says NY restaurateur Bruce Beschel in the New York Times.
We are losing money. That was expected. But we are losing less than we anticipated and attracting more guests than we imagined. We broke even last week except for the money I owe me.
As for restaurants which have been around for a while, they have their work cut out for them. The media have reported several restaurants filing for bankruptcy this year across the US. A weak economy, rising housing prices, cost of labor are some of the reasons cited for the situation.
Here are a few of the articles published today :
- 80 year old restaurant chain Friendly’s is filing for Chapter 11 bankruptcy reports the Wall Street Journal. A weak economy and rising prices for food items have contributed to this squeeze. As Shira Ovide puts it -
We don’t know what’s going on this year with restaurant chains/food companies from our childhood.
- Some Papa John’s franchisees in Colorado and Minnesota have declared bankruptcy as per this article on the KRDO site.
- The St.Louis Today reported that the franchise owner for Chevy’s has asked for his lease to be terminated in St.Charles, Mo.
The restaurant business is huge - in size, amount of job creation, revenues generated etc. In fact, there are more than 20,000 restaurants in NYC alone. What will be the figure next month - now, there’s some food for thought.
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