It's all about the dough

Small business, big dreams – it all starts with an idea

Fri, 16 Dec 2011 21:40:00 -0500

It’s 3 o’clock on a sunny Tuesday afternoon. Poonam Gambhir, is calm and collected while packing the 15^th container of chole masala and roti. She then breaks into a grin and she breathes a sigh of relief. The last meal has been packed for the day. Mahmoud, the delivery guy stacks this package along with 14 others in the trunk of the car idling outside and closes the door with a definitive bang. He’s now ready to drive to Manhattan. “That’s it. All done,” Gambhir beams.

Poonam Gambhir in the Tiffin Blog kitchen located in Stirling NJ. Photo/Rashmi Raman

Gambhir, in her late 30s, runs Tiffin Blog, a prepared meal delivery service. Her office is a cheerful, homey kitchen in a small rented building in Stirling, New Jersey. Now in its fourth year, Tiffin Blog delivers to homes in Manhattan, the Bronx and Brooklyn and the central part of N.J. The service specializes in homestyle Punjabi food, a north Indian cuisine characterized by the use of basmati rice, ghee or clarified butter and spices like garam masala.

She doesn’t have a culinary background. In fact, she trained in fashion design in New Delhi. She moved to the US in 1998 after marrying an attorney, who was already based in the US. She continued to work in fashion till 2005, the year her son was born.

While she found it difficult to manage parenthood and a full time job, she wasn’t keen to “sit at home” either. That is when she came up with the idea of getting into the food business. Hear the story of the idea behind Tiffin Blog in this audio clip.

Turning an idea into a business was easier said than done. It took her almost a year to register her company, find a space, arrange about $150,000 for financing and hire staff. Dolores Stammer is the Regional Director, New Jersey Small Business Development Center (NJSBDC) of Northwest Jersey, an organization that provides consulting services to small businesses in North West New Jersey . “Probably 18 months is more of a norm,” she says of the time taken to start a food business in N.J.

Stammer says that one of the biggest challenges of businesses like Gambhir’s is not knowing the rules and regulations. She says that start-up business owners come to her with questions about filings, to register the business, sales tax etc.

Sometimes, they may end up violating the regulations too. Stammer recollects the owners of a farm stand proposing to make pies with leftover produce. When they came to her with this idea, Stammer could not help but react, “Whoa, whoa, whoa, you can’t.” Stammer then had to explain that their idea violated Department of Health regulations at both the federal and local level regarding procurement of produce for commercial sale and disposal of leftover produce, something the owners had no idea about.

The Small Business Association estimates that small firms spend about $10000 per employee in a year on regulatory costs like environmental regulations, tax compliance, occupational safety and health, and homeland security regulations.

Jack Mozloom, Senior Media Manager of the National Federation of Independent Business, an advocacy group representing small businesses, remarks that regulations have to be “streamlined or even abandoned” as they are a “tremendous obstacle to growth.”

Gambhir says that her biggest challenge was raising money. Banks would not lend her the money for starting the venture. “In this economy, commercial financing for businesses under 2 years is almost impossible,” says Stammer.

But Gambhir persevered. She put in her savings; her husband pitched in as well. “I knew my idea was a good one and my research was solid,” she says. She knew next to nothing about running a food business. So, she had to start by going through sites and books. Then she had to figure out her target market – she zeroed-in on Asian Indian professionals and students.

She registered her business as TiffinBlog LLC, thus choosing the more popular form of incorporation to protect her personal assets from any liabilities the company might incur. The next order of business was to find a space.

It took her 4 months to find an appropriate place for her. She had no idea about zoning restrictions in Stirling. Every time she looked at a building, she would need to consult the Town Hall. She was also determined to avoid starting from a warehouse or sharing a kitchen with a restaurant.

“I wanted my own place, a happy space. [Not] a dingy place to cook my food,”she says.

She was driving by when she spotted a For Rent sign outside a small, boxy building. Fortunately for her, the owner of that building was the ex-mayor of the town and knew all the zoning laws. The law permitted running a kitchen on the premises. She saw this as an omen and signed an annual agreement almost immediately. Stammer, however, believes that Gambhir would’ve made her first sale sooner had she agreed to share a commercial kitchen with another business.

Staffing was another of Gambhir’s concerns. She did not want to hire professional cooks as she wanted to provide her customers with homestyle meals. And she had to keep it cost-effective. She prefers hiring US citizens or permanent residents over illegal immigrants. A friend recommended hiring Renuka Patel, who happened to live nearby.

Now, both Renuka and her daughter Shruti work at Tiffin Blog. Renuka moved to the US seven years ago and has been working at Tiffin Blog since 2010. Shruti, in her 20s, joined Tiffin Blog in January, soon after migrating to the US. “Achha lagta hai (we like the work),” they say while smiling at each other. When hiring them, Gambhir realized that they would need training as they were used to cooking Gujarati food, which is very different from Punjabi food.

Gambhir also has a few women on retainer. If it’s a busier week than usual, she calls them in to help with the cooking. They earn the same hourly wage as the regular staff and are paid by check.

For Shruti, working at Tiffin Blog is relaxed compared to her other job, as a cashier in a ShopRite supermarket. She earns about $200 per week in both jobs but her hours at ShopRite are longer. She also likes that she gets to spend time with her mother while working at Tiffin Blog. Renuka finds the schedule convenient and feels that the only time consuming aspect of the job is washing dishes and containers.

Mahmoud, who delivers the meals, likes working there because this is a “family business.” He makes around 15-20 deliveries daily. “The only stressful part of this job is the traffic,” he chuckles. He generally works from 3PM to about 9PM, which suits him.

Delivery days are Monday to Thursday. Friday is reserved for shopping. Gambhir and Mahmoud travel to Edison, N.J. to buy ingredients from the Indian supermarkets. After that it’s chopping, grinding of spices and pastes and other prepwork.

Gambhir discusses the optimal delivery route with Mahmoud. Mahmoud says that discussing the route beforehand makes his job simpler. Photo/Rashmi Raman

Gambhir designs the menu herself. Certain items, like the chole masala and the masala chicken are repeated more often as they are more popular. She uses her grandmother’s recipes. Her mother, who taught Home Economics in New Delhi has helped her improve the recipes. In the beginning, Gambhir also consulted a nutritionist to ensure the calorie measure of the dishes. She wanted to avoid preparing Punjabi food in the traditional way – dishes laden with a high fat content.

Customers can order meals on the phone or online. Most of her customers are Asian Indian professionals with families or students, says Gambhir.

80 percent of her customers prefer the seven-meal package priced at $45. A quarter of her costs are for raw ingredients and a further 65 percent or about $5500 are fixed costs like salaries, insurance, utilties and rent. Her gross margin is around 30 per cent or around $15. “I am making money, I can’t complain,” she says.

If there is one thing she could complain about, it would be the economy. Her business took off in 2007 and she began to consider expansion. But then the financial crisis of 2008 struck. A lot of her customers, especially those employed by Bear Sterns and the Lehman Brothers, lost their jobs. And she lost about a tenth of her business. “It’s much better now,” she says. She is able to grow at about 10 percent annually. It is less than what she expected and the idea of a second kitchen has been put on the back burner.

A large portion of her business is generated through word of mouth publicity. But a lot of her non-Indian customers signed up after they found her ad on Google. She is still cautious about advertising on Google and considers it to be a learning experience. So far, she has spent about $275 on Google ads.

Raj Camnani, 46 is a venture capitalist who lives in Shorthill, N.J. He found Tiffin Blog using a Google search 2 years ago. He was initially “skeptical”, but decided to try the service for 3 weeks. Now, he orders his favorite Mutter Paneer, Rajma masala and Palak Paneer regularly. “There is a real need for this kind of service in this part of N.J. I have also recommended the service to my friends,” he says.

Interestingly, her main competitor has a similar name. Tiffin Foods U.S., based in Long Island, also specializes in Punjabi food. Tiffin, a word coined by British colonials in India, is a light meal. It also means the container used for packing the meal – imagine a multi-tiered bento box. Tiffin Foods did not respond to requests for comment.

Gambhir believes that the quality of her food provides her with the edge. Vasundhara Gupta, in her 50s, is a marketing professional who lives with her husband and daughter in Queens. She works long hours and has to travel frequently. She heard about Tiffin Blog from a friend almost 3 years ago and decided to try the service. “Most maids cook Gujarati food, which I am not too fond of. The food [at Tiffin Blog] is like ‘ghar ka khana’ (home-style),” she says.

Besides delivery of prepared meals Tiffin Blog also provides catering services for small parties and get-togethers. It benefits from its location as there are a lot of offices in the area who put in orders.

Gambhir is still looking to expand the business by introducing services in central and southern NJ and other boroughs in New York City including Queens. Perhaps, in time, she could own a second kitchen too.

Winters and festivals are a good time for the business. The weeks imediately after Diwali (generally mid-November) and summer are the slowest.

“Running a food business is tough,” she says. She believes that she has made up for her lack of experience with a lot of hard work and research. But some factors are beyond her control. Like the recent snow storm during the weekend that disrupted the business; there was no power, and the roads were icy. The staff found it difficult to get to work, the kitchen could not run for the usual number of hours and deliveries took longer.

Gambhir packs the meals to be delivered. As part of quality control, she checks every package. Photo/Rashmi Raman

She is very much involved in the day to day operations of the business. Besides planning the menus, she carries out quality control by getting the food tested regularly and purchasing the packing materials herself, packing the meals and consolidating the orders. If she is shortstaffed, she also does the cooking. Running a business for her is all about “taking an idea and making it work everyday.”

“It’s a rewarding experience,” she says. “This is my baby.”

Fingerprints for food stamps – a fair exchange?

Thu, 15 Dec 2011 00:36:00 -0500

Governor Cuomo has just announced that fingerprinting is no longer a requirement for food stamps applications. In a joint statement, Speaker Quinn and Council Member Palma said, “Governor Cuomo’s action is an enormous victory for New Yorkers in need, and for all those who have fought to put an end to the detrimental practice of finger imaging food stamp applicants.

The Governor’s announcement today will eliminate a senseless barrier that, for too long, has prevented tens of thousands of qualified New Yorkers from receiving the assistance they need to feed themselves and their families.”

____________________________________________________________________

It’s 1:00 p.m. on a sunny, cheery Monday. At the Westside Campaign Against Hunger (WSCAH) center at the corner of W. 86th St. and West End Avenue, though, the line of people by the door is anything but cheerful. William Farkas, 40, moves with the line. He’s ready to redeem about $40 worth of his food stamps to shop at the pantry hosted by the center. He’s hungry and hasn’t eaten all day. Yet, like everyone else in the line, he waits patiently for his turn. This is routine for him – ever since he applied for food stamps 10 years ago. He is stoic but there is a sense of despair, helplessness and resignation about him. “I feel like a loser for even being here,” he said.

Farkas is not alone. The recession is leaving a lot of hunger in its wake – rising levels of unemployment and poverty have made an increasing number of New Yorkers turn to the government for assistance. As of September 2011, data published by the the New York City Human Resources Administration (HRA) indicates that more than 1.8 million New Yorkers are part of the Supplemental Nutrition Assistance Program (SNAP), better known as the food stamps program. Some, like Farkas, rely on food stamps alone, while others, like Terrica Glenn, 35, use them to supplement their income. Hear Glenn’s story in this video.

In September 2008, this number was 1.2 million. Numbers released by the WSCAH show a steady increase in the number of food stamps applicants visiting the center, across all age groups.

Food stamps applicants who visited the pantry at the Westside Campaign Against Hunger center. Source, Westside Campaign Against Hunger.

Stanley, 53, who did not want to give his fullname, was also shopping at the WSCAH center. He said, “I was brought up to believe that if I had a good mind and a good body, I could provide for myself. My parents lived from paycheck to paycheck, but there was always food on the table. I cannot promise this to my kids. I feel so inadequate for asking for help.” Stanley worked as a porter at a university and a hospital (he did not wish to name them) but was laid off both these jobs in the same week. With no job prospects at the moment, he had “no choice” but to apply for food stamps.

According to a testimony by Commisioner Robert Doar of HRA, the Bloomberg administration has had to deal with an “unprecedented caseload growth” in applications for food stamps. But that is not what is worrying City Council Speaker Christine Quinn and her colleague, Council Member Annabel Palma. In a press release dated October 12, Quinn cited a report prepared by the Urban Institute that an additional 30,000 New Yorkers are “deterred” from applying for food stamps each year. According to the report,they are deterred by the city’s requirement that applicants agree to be fingerprinted to establish eligibility.

“There is a stigma associated with fingerprint imaging,” says David Pristin, Director of the Policy Division at the New York City Council. “Certain communities associate it with immigration or criminal justice issues.”

“I felt like I was being arrested all over again,” recalled Farkas referring to the time he was fingerprinted for his application. Stanley said, “It was an invasion of my privacy. It was totally humiliating.” Roxona Coronel, 37 and a mother of three, was resentful when her fingerprints were scanned. “Treat me like a person,” she said in Spanish. “I am not an animal. People sign, animals are printed.”

“Another deterring factor,” says Pristin, “is that it takes almost 5 hours for fingerprint imaging [waiting in line]. This is a problem for residents with children at home or who work on a per-hour basis.”

Recently, Texas and California joined 46 other states when they did away with fingerprint imaging. California rolled out fingerprint imaging systems in March 2000. However, the United States Department of Agriculture (USDA), which administers SNAP, had listed California as a poorly performing state in the program. The federal government as the sponsor of the program, was concerned and this prompted an audit report in January 2003.

The report highlighted the fact, that in 1996, in Los Angeles county, out of the 137 cases, which were discontinued, 31 were for suspected duplicate-aid fraud. Of these, only eight were verified valid cases – amounting to six percent. A list of welfare-fraud cases posted on the Department of Social Services site indicates that most convictions for such cases were for providing false information about income to improve eligibility. Based on such facts, the report concluded that the state had been “remiss” in implementing the fingerprint imaging system before determining the true extent of fraud. Assembly Bill 6 was approved by the Governor in October 2011.

New York State dropped the requirement in 2007. Arizona and New York City are the only two jurisdictions that continue the practice.

On the heels of the bills passed in California and Texas, both in September 2011, Quinn and Palma introduced a bill, Intro 696, in October 2011 requiring HRA to provide a report on the amount spent on fingerprint imaging, the number of fraudulent applications detected and the rate of prosecution for such cases.

Then, in a hearing conducted on November 21 City Council hearing, Commisioner Doar testified the City spent $182,596 every year on fingerprint imaging. In 2009-10, he reported, 1,919 duplicate cases had initially been detected among food stamps applications. But several of these were due to human error such as oversight by caseworkers or problems with paperwork. Overall, he said fingerprint imaging prevented an average of $3 million a year in federal dollars from being misspent. “I would like to be clear, it is not about prosecuting individuals for fraud; it is about preventing and deterring fraud in the first place,” he said at the hearing.

Speaker Quinn disagrees. In a statement, she said, “Requiring food stamp applicants to submit to finger imaging to receive benefits is an ineffective way to detect fraud and wastes millions of dollars in taxpayer money each year. The City spends its own scarce tax dollars on a process that serves no public good.”

Regarding prosecution, an HRA spokesperson said, “When duplicates are found, they are removed without further investigation or referral to law enforcement.” He added further, “If actual fraud in any program is detected through program integrity measures or reported by witnesses, HRA investigates the matter thoroughly and works with the police department and the attorney general’s office to pursue the case to the full extent of the law.” However, when asked whether the suspected duplicates are scrutinized before or after they are removed, he declined to comment.

Councillor Palma believes the practice is “shameful.” “No one has ever been prosecuted for fraud,” she says. “There has been no follow-through; people are never reported.” She admits that in the context of the City’s budget, $180,600 is not a large expense. She views this as a waste of time and resources. “It can be invested [instead] in hiring staff, for example,” she says.

Most people in the line at WSCAH consider fingerprinting a part of the process. Michelle Alexis, 28, was “surprised” that she needed to be fingerprinted, but said she didn’t really mind. She went to the HRA East End Food Stamp Center in Harlem, as that was the most convenient location for her. She didn’t have to wait in line as she is disabled. “[The HRA official] called my name and I walked to a counter. There were other such counters too.” she says. “He instructed me.. hich finger I needed to put – thumb, forefinger and middle finger, left and right. They had a scanner where I needed to place my fingers. That’s it.” She was done in 30 minutes. Nelson Quiroga, 38, had a similar experience but also remembers that the operator was “rude.” He says in halting English, “I think he was rude because it was such a busy day – so many people there.”

Food stamps beneficiaries wait in line at the West Side Coalition Against Hunger kitchen. Photo / Rashmi Raman

As a Public Benefits Counselor at WSCAH, Esmeralda Perez has submitted 177 SNAP applications on behalf of clients since May 2011. She observes that applicants have not been complaining about fingerprint imaging even if they dislike it. “They are willing to overlook it because they have the need,” she says.

Interestingly, she says, undocumented adults are not eligible for SNAP, but their minor kids are. So, if an undocumented adult applies on behalf of her minor kids, she does not need to be fingerprinted. Only legal residents over 18 years need to undergo this process. Clients frequently ask her whether SNAP applications can affect their immigration status. “The short answer is, no, it doesn’t,” she smiles. Residents also have the right to waive fingerprint imaging under certain exemptions, such as disability and advanced age.

Perez says that, for her clients, waiting in line to be fingerprinted is not the most time consuming aspect about the application. In fact, more time is spent in ensuring that the applicant has all the required documentation. “It just takes me an hour to fill out the form online for a family of four,” she says, “if the client has all the required documents.” After submitting the form, she schedules a telephone appointment for the applicants with the HRA. She believes the application process is straightforward. Most applicants standing in line to shop at the pantry at WSCAH seem to agree with her.

Perez reports that some applicants complained to her about the HRA calling them up because of missing fingerprint images even in cases when they had already undergone the process. “We have heard of problems with the vendor that the HRA uses for fingerprint imaging,” she says. “Sometimes, HRA does not receive [the image] because of possible errors in the third-party software.”

Anthony Carroll regards fingerprint imaging as an additional form of security. Now 25 years old, he has been homeless since 2009 and has been on food stamps since then. His stepfather had received food stamps by fraudulently using Carroll’s ID when he was 13 – fingerprinting had not yet been implemented. Carroll was unaware of the scam until an official at HRA informed him while screening his recent, legitimate application. Fortunately for Carroll, “common sense prevailed” at the HRA office – they reasoned that a 13 year old kid couldn’t have succesfully defrauded the city of food stamps.”It felt good,” he says of the fingerprint imaging process. “No one will be able to take food stamps in my name anymore,” he smiles.

When asked about the alternative to fingerprint imaging, Council member Palma insisted that documentation including Social Security cards and other forms of identification should suffice. Joel Berg, Executive Director of the advocacy group New York City Coalition Against Hunger, believes the efficiency brought about by the “smart” online application system for food stamps is completely “obliterated” by fingerprint imaging. He is referring to Access NYC, an online application and screening system where New Yorkers can apply for various benefits, instead of manually filling out forms at one of HRA’s Food Stamps Center. “48 states match [identification] files on the computer, not fingerprints” he says. “Why can’t we?”

Celeste Sanchez, Program Director, Social Services,WSCAH “checks in” food stamps beneficiary Concita Sanchez using her Benefits card. Photo/Rashmi Raman.

Berg disputes that fingerprint imaging deters fraud. He testified at the November 21 hearing that fingerprint imaging is not the most effective way to detect fraud. He alleged that the most common occurrences of fraud are trafficking, which the USDA defines as “the illegal buying or selling of food stamp benefits for cash, drugs, weapons.” Other convictions have involved government employees faking cases, most notably, HRA employee Vanee Sykes creating more than 1000 fake food stamp cases. But a majority of the cases are about applicants who hide extra income. And none of these frauds can be detected by fingerprint imaging.

If fingerprint imaging is done away with, the next point to debate would be if the public would need reassurance that their applications are still, as Rosalyn Walker, 46, puts it, “good and safe.” Council member Palma says an educational campaign might help to create awareness about the security of using only identification documents for screening applications. Berg doesn’t see the need for a campaign, either. “They didn’t do anything in Texas,” he points out.

For a lot of people like Michelle Alexis, it doesn’t matter one way or the other. She said, “[Getting fingerprinted is] better than starving for sure. [But] if they remove it, that’s fine too.”

Good news for the Hunts Point Market

Sun, 11 Dec 2011 23:28:00 -0500

Gov. Andrew Cuomo has just awarded $29.5 million to the Hunts Point Market in the Bronx in an initiative to revamp the facilities. This is a big step for the market, Crain’s New York Business reports.

This is also a part of Gov. Cuomo’s promises during his campaign tweets City Hall News.

Econ. Dev. Councils award $29.5 million to revamp Bronx hunts point produce market, something Cuomo promised during campaign

The produce market is still short of $20 million to carry out all the planned renovations and repair.

“We still have a lot to do to get all the dollars needed,” to renovate the 44 year-old facility, said Sid Davidoff, a lawyer representing the produce businesses that comprise the facility.

Read more: http://www.crainsnewyork.com/article/20111209/SMALLBIZ/111209865#ixzz1gI3k6nWZ

Mayor Bloomberg welcomed this development. “We really do need to redo the produce market. It’s not competitive anymore,” he said during his weekly radio show on WOR. He expressed his concerns about the accessibility of the market, especially in the face of competition with New Jersey.

“New Jersey has been very aggressive in offering monies and benefits to the vendors to move over to there,” he said. “We can’t get into a bidding war, but we can make this as attractive as we can, and I think this would help us do that.”

The Wall Street Journal reports that this award is part of a $200 million fund to encourage development projects in the state and improve job rates. Of these projects, the award to the Hunts Point Market is the largest.

Hunts Point reportedly delivers 20 percent of the total produce in the state.

An NY1 report quoted Denise Goodman of M&R Tomato Distribution Inc.

I believe one out of every four families will be having some kind of produce item that came from this market

According to the report, the market did brisk business during the Thanksgiving holiday.

Whether Hunts Point will get all the money that it needs is stil an unanswered question, but this award is a step in the right direction.

Success is not so sweet anymore

Fri, 02 Dec 2011 19:44:01 -0500

Success is not so sweet anymore:

Food trucks are everywhere in NYC. Ranging from the local Halal cart or new entrant Kimchi Taco, they serve a variety of food which is relatively inexpensive, delicious and quick.

These trucks are now such an integral part of NYC - and they are success stories. Or they have been. Till now.

Crain’s New York Business reports that an almost unheard-of parking rule prevents trucks from selling food in most commercial districts. Commercial districts are the main markets - several office-goers, shoppers and tourists eat at these carts.

The obscure parking rule has been on the books for decades, but earlier this year, a judge ruled that the regulation that bars vending from metered parking spaces applied to food trucks. Given that almost all parking on midtown Manhattan streets is metered these days, the ruling saw trucks lose their most lucrative spots, where they had built up a following of loyal customers practically overnight.

Meanwhile, Columbia Spectator reported that food trucks will now be surveyed over three weeks in Community Board 7 to check if they complied with regulations. Residents have complained about the fumes and the noise.

“The idea is to get an accounting of what we have and where it is,” Andrew Albert, co-chair of the CB7 transportation committee, said. “We’re not trying to kill them—we just want an idea of what we have and how we can make it best serve the neighborhood.”

Food truck owners are worried. 70 percent of the members of the Food Truck Association have seen a drop in revenue since the parking law was enforced. They have also engaged lobbyists to discuss parking and other regulatory issues with City Hall.

The Food Truck Association has setup a petition page on their site to get public support for food trucks. Their latest tweet pretty much states that.

Come out and support your favorite #foodtruck today for #lunch! What are you eating, #foodies? #nyc

What does this mean for New Yorkers like paristosyd who posted this on her Tumblr :

Another thing i love about New York City; Food trucks.

It is so innovative, handy and inexpensive to have so many food trucks roaming around American cities.

They might have to go all the way to Chelsea, Flatiron or the Upper West Side where the rules are not enforced.

Then again, they may not find their favorite truck there.

Making it personal

Fri, 02 Dec 2011 17:54:00 -0500

New Yorkers don’t cook. A tired truism, but there is no denying it. Between work, the commute, small kitchens and spending time with the family, cooking at home can take a backseat.

But, for some New Yorkers, a day at the office involves cooking. A lot of cooking. While the fry cook and the Michelin starred-chef work at commercial kitchens, there is another group who don their chef’s hat in the kitchens of their patrons.

Private chefs are in the employ of their clients – they provide what is known in culinary parlance as “table-side service” that is, preparing the meal and serving it to their clients in their homes every day. Personal chefs, on the other hand, visit their clients once or twice a week and prepare several meals at once.

Piper Wilder and Amanda Anderson have been personal chefs for about 2 years. Every week, they each visit about 3-5 homes, mostly in Manhattan, to cook for New Yorkers who can’t cook or cannot find the time to do so. And it’s not just cooking. Planning menus based on the client’s tastes and requirements, grocery shopping, cleaning up, packaging meals – all these can be part of the service too.

There are as many similarities as there are differences in the way the chefs run their businesses. Candy Wallace is the founder and executive director of the American Personal and Private Chef Association (APPCA), an organization that promotes the concept of a personal chef. “No two personal chef businesses are alike,” she says. “They differ primarily because of the level of culinary expertise and the chef’s personal preferences.”

By personal preferences, she is referring to the number of hours a chef is willing to put in (some chefs may put in about 20 while others may choose to have a 60 hour week), flexibility in scheduling, and the cuisines they offer.

When a personal chef first visits a prospective client, she conducts a “Personal Assessment Interview.” The client and the chef discuss the client’s tastes, allergies, schedules, the kitchen and set up a service agreement. They also agree on the mode of payment such as check or credit card and the schedule of payments. The agreement also includes certain stipulations like equipping the kitchen with the required containers, pots and pans and ensuring a clean kitchen. Typically, personal chefs in New York City charge anywhere between $350-$400 for a day’s work.

You pay $350 to a personal chef. What are you getting charged for?

So, while Wilder and Anderson became personal chefs for the same reasons – a love for cooking, flexible working hours, less stress than working in a commercial kitchen and a desire to feed people delicious, healthy meals - their businesses are as different as their personalities.

Watch Anderson describe her job in an audio slideshow.

Cooking with Chef Amanda Anderson. A video by Rashmi Raman

Wilder, in her 40s, is a native of the Upper West Side and a self-taught chef, who talks in rapid, staccato sentences and addresses everyone as “my friend.” Watching her cook is like being at the horse races – it’s speed from the get-go. “We’re going to be just fine…it’s going to be perfect”, she says repeatedly when she realizes that she didn’t bring her favorite knives along with her on the job. “I’m very good, but I am not a Daniel Boulud,” she says wryly.

Anderson, 27, who grew up on Long Island, has a business degree from the University of Buffalo. But after graduation, she realized that her heart was set on cooking. So, she enrolled in Natural Gourmet, a relatively inexpensive culinary school in New York City where she also trained to be a nutritionist. Self assured, quiet and methodical, she almost adopts a Zen state when cooking. She is almost oblivious to other people in the kitchen and concentrates solely on the task on hand.

What does she like to cook the most? “My customers love my pasta with bacon and artichoke with tarragon and red wine vinegar. I make it very often,” she says.

According to Chef Wallace, this is a business in which it takes nearly three years to firmly establish a reputation. So by that definition, these women are “almost there.” Both have other jobs, as they cannot yet support themselves by cooking alone. Wilder designs jewelry on commission and Anderson is a health coach.

Wallace says a personal chef can take on various career streams like teaching, organizing seminars, authoring cookbooks and blogging about food.

Once established, Wallace estimates that personal chefs can make about $50000 to $80000 in a year. Wilder says that she’s not going to give up the other job just yet – she’s waiting until she has enough clients to work five days per week before she can think of quitting her jewelry design job.

Hence, these chefs leave no stone unturned when it comes to spreading the word about their services. Press releases, 4x6 cards, tweeting about their services, constant updates to their Facebook pages, ensuring that their website appears among the top results in an Internet search, visiting doctors’ clinics to get referrals, hosting events on Meetup.com, cooking at philanthropic events are part of their strategy. For example, Anderson had organized an event to demonstrate her recipes on Meetup.com and had tweeted about it. Both Anderson and Wilder get 80 percent of their customers through word of mouth. However, Wilder says that recent customers found her through her Google ads. For example, the first ad that comes up on typing the keywords “personal chef nyc” is Wilder’s ad announcing a 50 percent discount on her services for the holidays.

Anderson initially set up an S Corp, a type of company that passes income, losses and credit to the stockholders for tax purposes. It’s a move - recommended by an accountant- that she regrets as she is the only stockholder. She feels that she has ended up paying about 10% more taxes than necessary. She has fired the accountant, paid up her taxes and is looking to start a Limited Liability Corporation (LLC) where her personal liability will be far less. Insurance would provide an additional security blanket and reduce her personal liabilities further. “I should have insurance (like the one provided by the APPCA) but I don’t. I guess I’ve never really had problems so far,” she grins ruefully.

Anderson would love to have two sous chefs by the time she turns 30. She thinks she’ll end up more on the managerial side of things. “Maybe I’ll also open my own cafe and serve the kind of food I like – healthy and delicious Italian food,”she says.

Wilder, on the other hand, as a member of APPCA, opted for the insurance provided by the organization. She confesses that she needs to incorporate her business but hasn’t gotten around to doing that yet. She was also trained by the APPCA on various aspects of running the business like building a website, pricing structures and conducting the assessment interview. She wants to host more of what she calls “romantic dinners for two.” For $325, she prepares a three course meal for an evening and this is her most profitable service.

“The first 3-6 months are crucial for the business,” says Chef Wallace. “People love to cook, but they forget that cooking is just one aspect. This is a business and it needs to be constantly nurtured.” She estimates that chefs require about $2000 as initial capital - for incorporating a business, getting a ServSafe certification which licenses the chefs to handle food, and insurance.

The insurance, provided in conjunction with the APPCA, covers law suits filed by clients, medical expenses due to accidents on the job, damage to equipment like utensils and the office computer etc.

Being a personal chef involves a lot of hard work. Planning a menu consisting of five meals can sometimes take about eight hours. “You’re standing on your feet seven, sometimes ten hours in a day. Carrying groceries in the subway…it can get tiring,” says Anderson. Wilder grins when she sees the doorman offering to help her with the groceries. “Unlike other cities, chefs in New York cannot think of buying a van to carry equipment and groceries. There’s no parking in Manhattan,” says Chef Wallace.

The job can be frustrating too. Difficult and flaky clients, tiny, dirty and ill-equipped kitchens, potential leads not turning into customers, and constant distractions while cooking can make things difficult. Wilder remembers planning a dinner party for a client who kept changing her mind and was unsure of the menu. Wilder was frustrated but had to grin and bear it. Finally, to Wilder’s relief, the client approved the menu and Wilder was able to get on with the rest of her work. But both Anderson and Wilder are pragmatic. They know that the competition is intense - what with a 100 other personal chefs in New York city, services like freshdirect .com and frozen meals at the supermarket. So, they have to offer more. “I try to be flexible. I work around the customer’s schedule, their tastes and their budget,” Anderson says.

“Oh my god, yeah,” says physical therapist Erica “Ricki” Weisselberg, when asked if she is happy with Anderson’s service. “Her food is yummy,” she says. Anderson has also helped look after the Weisselberg kids occasionally. Plus, she accompanies the family to Connecticut during the holidays to cook for them. She prepares meals designed with Jack Weisselberg’s acid reflux problems and the kids’ picky eating habits in mind. The rapport between Weisselberg and Anderson is obvious when Weisselberg asks her kids to perform a dance that they learnt at school for Anderson and they both laugh during the impromptu performance.

Carol Fuerstein is a native New Yorker and has been living in an apartment on the corner of 103^rd St. and West End Ave. since the 1970s. Afflicted with Parkinson’s disease, she can no longer indulge in love for cooking. She heard about Wilder through a friend. It seemed like a good idea to hire Wilder as she would get to eat “interesting” food, like her favorite chicken picata.

Watch Wilder make sauteed spinach, an accompaniment to the chicken picata.

Chef Piper speaks by Rashmi Raman

There also appears to be a sense of affection between Wilder and Fuerstein. When Wilder is done making the mushrooms, which will also accompany the chicken picata, she quickly stabs a mushroom with a fork and feeds it to Fuerstein to ask her opinion, something she may not do with other clients.

Wilder says she loves being a personal chef because of such interactions. She would also love to work all seven days of the week. “I have tons of energy, I keep myself healthy,” she says. “I can definitely do it.”

The Business of Media in Television: McDonald's would like to present..... McTV!

Tue, 22 Nov 2011 11:12:34 -0500

The Business of Media in Television: McDonald's would like to present..... McTV!:

This article from the Wall Street Journal states that

While the TV channel will generate advertising revenue from commercials, McDonald’s is hoping McTv will also encourage guests to eat inside, ordering seconds or desserts.

McDonald’s is miles ahead of its competition. From Reuters -

Wendy’s reported a 1.8% rise in quarterly sales which translates to $611 million. Analysts were expecting a 1.9% or a $618 million rise in sales. In contrast, McDonald’s reported a 5.5% gain in sales, exceeding analysts’ expectations.

So, McDonald’s is no longer competing with just Wendy’s or Burger King. They appear to have taken on diverse operations like Starbucks, Applebees and sports bars.

Reblogged from ksm310:

According to the LA Times, McDonald’s will be creating their own TV Network. In over 800 different McDonald fast food restaurants in Southern and Central California, new 42-inch flat screen televisions will be introduced to customers. The McDonald channel is being spearheaded by…

Deli worker in search of the American Dream

Tue, 22 Nov 2011 10:50:00 -0500

Davindar “David” Goyal’s workday begins at 6 a.m. when he catches the R train from his home in Astoria to the 8^th Street NYU station. He’s about to put in a 12-hour shift at Sam’s Deli on Second Ave. in the East Village. On reaching the deli, he prepares for a new day – checking inventory, preparing coffee, slicing meat and swabbing the floors.

The store is quiet – but not for long. By 7:30 a.m., customers start trickling in. Most are regulars, and Goyal discusses the news with them. Or he will ask them about their family. All this while making their favorite sandwich. “I know what sandwich they like. I’ll ask them if they’ll have their regular and most times they say yes”, says Goyal.

Goyal prepares sandwiches at the grill. Photo by Rashmi Raman

Goyal rushes between the grill, the coffeemaker and the till. He takes a 10-minute break to call suppliers about deliveries. Then he begins to prepare for the lunchtime crowd. And then for supper.

By 7 p.m., he is dead on his feet. “This is a job where you keep standing or moving. Customers won’t come in if they see the staff sitting,” he says. So on his ride home, he walks to the end of the platform, seeking one of the less-crowded cars so he can get a place to sit. “This is the only time I get to relax”, he says.

Goyal, 38, has been working at the deli for 13 years. He works six days per week in 12-hour shifts, some of them night shifts. He earns about $600 per week after taxes, has no benefits and pays $50 per month on private health insurance. He says he has not called in a sick day in all 13 years and has taken about three vacations of three to four days each since he joined the deli.

Goyal used to enjoy working at the deli. “I didn’t know how to make a sandwich. I hadn’t spoken English for years. There was so much to learn.” But the charm wore off long ago. “Now, it is about killing 12 hours”, he says.

Getting a “green card” two years ago was a major turning point in his life. It took 10 years to get it.

Goyal feels that he now has more opportunities available to him.

And yet, Goyal still has not taken many steps to move beyond the deli. The family discusses his future on Sunday evenings. Getting married is the top priority and his sister is busy shortlisting girls. “A lot depends on the girl I get married to”, he says. If he marries a girl from India, it would take him a year and considerable money to arrange for her travel to the US. “I would need to save some more money”, he notes.

Not that the green card isn’t important. He believes that his matrimonial prospects have improved and now wants to get married. He was also able to get his driving license three weeks ago and is excited about buying a car.

The green card gives him the confidence to think of the future. “It’s time to grow now”, he says. He is considering studying to be a nurse or an electrician.

But he has set his heart on starting his own business, possibly in partnership with his brother-in-law, Jiwan Gupta, an New York City cab driver.

Goyal’s childhood was tough as his parents weren’t working. He was not able to study beyond high school because of lack of money. In 1998, Goyal decided to quit his job as a shoe salesman in the Indian town of Moga and make his way to New York. The decision was an easy one. “I came here for a better future,” he says.

His sister and brother-in-law were already in the U.S. and arranged for his travel, as his savings were near zero. They also arranged to get him a job at Sam’s deli the day after he landed in the U.S., using family ties.

Getting a job via connections is a classic tactic among immigrants. In a study titled “The Strength of Weak Ties”, Mark Granovetter, a professor of sociology at Stanford University, explored the ways in which immigrant populations reach out to others in the community. More often than not, the connection is tenuous. Yet these interactions can yield results. He concludes that weak ties have a “cohesive power”.

Goyal is a case in point. His brother-in-law was able to secure a job for him after speaking with the cousin of a friend. Goyal thinks that his boss, Roop Bring, prefers to employ Asian Indians as he believes they learn quickly, are more confident with interacting with customers and are ready to work for lesser wages.

Goyal’s social life is limited. He lives with his sister, her family and their parents in Astoria. He prefers spending time with them, especially his nieces. He rarely goes out and has few friends. “It’s difficult to make friends if their jobs are like mine. When would we get to hang out?” he says. These days, though, a lot of his free time is spent in visiting the rehab center to keep company with his father, who has a heart illness.

His sister and brother-in-law were also his sponsors for the green card. The process was long and expensive. Legal fees ran around $4,000.

There are parts of the job he still enjoys, particularly talking to regular customers. He is on a first-name basis with a lot of them. They invite him to parties in the neighborhood. Some of the women customers flirt with him.

Goyal’s favorite part of the job is to interact with customers. Photo by Rashmi Raman

While it has mostly been an uneventful job, there have been moments Goyal remembers all too well. He recollects an incident where two men broke into a fistfight when one of them insulted the other. Goyal was required to break up the fight, call the police and later clean the bloodstained floor. “This is part of the job too,” he says.

Goyal has tried to build business, suggesting to his boss that he install more seating area or better interiors. He is frustrated that his suggestions have been rejected, but notes, “I’ll do all this in my business.”

Sam’s is typical of many New York City companies. According to a study by the Fiscal Policy Institute, immigrants own 48% of small businesses in New York City across various sectors (please see graphic). Some sectors are dominated by them. For example, immigrants own 84% of all grocery stores and almost 70% of all restaurants in the city.

Bring bought the deli in 2002. He started just like Goyal – migrating to the US with hardly any money and no idea about his job prospects. He put in 80 to 100 hours a week in another deli and saved enough money to buy out his boss. He then went on to buy Sam’s. (He speaks about his experiences while starting his business. in this audio clip.)

Both Goyal and Bring are from Punjab, a part of India known for the entrepreneurial spirit of its people. “You don’t get much respect back home when you tell them you are employed by someone else”, says Goyal’s colleague Amarjeet Singh, also from Punjab.

Goyal is looking to buy an established business. It could be a gas station, a pizza parlor, a liquor store or a deli. However, he is not interested in offering to buy out his boss as he “just doesn’t want to work here”.

He has been saving a part of his salary so that he can make an initial investment without getting into debt. He may consider moving to upstate New York or even to New Jersey, given the costs of buying a business in the city.

Goyal will need to rely mostly on his savings as securing financing for running a small business has become difficult since 2008. Banks and financial institutions have become more stringent with giving credit to small business owners.

While Goyal may not be sure of what the future holds for him, he is optimistic. The American Dream is still something he aspires for. For Goyal and many others like him, “it is now time to grow.”

What's your beef

Wed, 16 Nov 2011 21:21:34 -0500

Your next hamburger is probably going to be more expensive than you expect. Why? The price of ground beef has relentlessly been rising this year.

A WSJ report attributes this largely to the increasing craving for meat - be it a sirloin steak for those who can afford it or roast beef for those who cannot afford a steak.

Now is a good time to be a cattle farmer. The report quotes Iowan farmer Sam Carney -

“We’re making money and paying off bills,” says Sam Carney, who raises thousands of pigs and hundreds of cows, in addition to growing crops, on his farm in Adair, Iowa. “It wasn’t that way a few years ago.”

Last year, the USDA reported that almost $3.8bn worth of beef had been exported and this year is set to top 2010.

Wal-Mart is also having a huge hand in deciding the price of beef, says WSJ. Until Wal-Mart confirmed that it was rolling out choice cuts to its 3800 stores, analysts were wondering about the confounding increases in the prices of beef.

What does this mean for the consumer? The LA Times detects a trend in offering more sausage and pork dishes - not only because of the demand but also because of cheaper prices.

Drovers’ Cattle Network, a trade magazine focused on beef has reported that cattle farmers are reducing cattle slaughters due to ever-increasing prices. This might raise the prices even higher as the supply will become limited.

Wendy’s attributed its recent quarterly losses to the spikes in beef prices. These losses will need to be adjusted in the price of the burger, so don’t be surprised if you end up paying more.

However, Voice of America has painted a gloomy picture for cattlemen and consumers alike. The drought could spike prices even higher, according to its report.

So, it’s not over yet. “What’s your beef” is going to take on a more serious meaning in the days to come.

Coffee coffee everywhere.....

Sun, 06 Nov 2011 18:28:43 -0500

A report in The New York Times comments on the proliferation of coffee shops in NYC.

Small coffee chains, benefiting from lower retail rents and a seemingly bottomless thirst for high-end coffee even in a weak economy, are seizing the opportunity to expand in New York City.

Sam Lewontin of Everyman Espresso says that coffee shops are in a state of flux. He believes that in the end, there will be mainly two types of coffee shops in NYC. The first kind would sell inexpensive coffee. The second would be like to coffee equivalent of a cocktail bar. These coffee shops would offer experiences like ”cupping” (think wine tasting but for coffee).

Coffee could become a luxe item in the next 5 years, he says. And the coffee business needs to figure the next sustainable operating model.

Till then, enjoy your coffee at your favorite coffee shop. While it is still around.

Taking on the $31 per week food challenge

Thu, 03 Nov 2011 01:05:00 -0400

An interesting food challenge is making the rounds. No, it’s not about eating a 6 pound burger. For 1 week (starting Oct 27), you must eat only based on the average food stamp allotment.

This means, if one takes up the challenge, you can eat about food costing no more than $31 in a week. This, according to FWPF comes to spending a $1.50 per meal.

This is intriguing. The objectives of issuing the challenge are not immediately obvious. FWPF claim that only by actually eating like a beneficiary of the food stamp program, will we be able to understand the importance and the pitfalls of the program.

There is a detailed plan if you wish to take up this challenge. This includes writing down a detailed spending chart, eating food which one has purchased for this challenge and writing about this challenge.

It’s really tough for New Yorkers. NYC does not have too many options for a meal which is priced under $2. The only meals that come to mind are veggie samosas from the halal cart or a toasted bagel without cream cheese. Sheila Steffen, a producer for CNN blogs about her experiences during the challenge in NYC.

Rep. Jan Schakowsky (D-IL) has taken up this challenge and has blogged about it on the Huffington Post. As has Rabbi Steve Gutow President and Chief Executive Officer of the Jewish Council of Public Affairs. Rep. Joe Courtney (D-Conn) and his family are also living on a food stamp budget as per this report by ABC News.

What was truly interesting was the shopping list which Rep. Schakowsky had planned out - the list has veggies, meat and protein.

Rep. Courtney tweeted about one of his meals on Day 6 :

Day 6 #snapchallenge lunch: cheese sandwich, carrot sticks and an apple.http://yfrog.com/nx3g0mtj

The challenge seems to have provided food for thought. There are 45 million users on the Food Stamp program as per CNN Money, an all time high. According to the report

The rise in food stamp use comes as the U.S. job market continues to sputter, and food prices across the country climb.

WSJ: The Fast Food Revolutionary

Mon, 31 Oct 2011 15:45:00 -0400

WSJ: The Fast Food Revolutionary:

Chipotle’s (CMG) share price hit a 52 week high today as reported by the Street.

The company’s strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations.

Translation : Chipotle has great sales and great revenue figures. In fact, analysts are recommending investors to buy Chipotle stock.

So, a profile piece in the WSJ couldn’t have come at a better time for the company.Chipotle’s brand image is powerful - sourcing ingredients from small farmers and sustaining small agriculture. And the piece from WSJ highlights this.

Chipotle is getting all sorts of press and some reports are not necessarily of the glowing kind. This blog post from chef and activist Daniel Klein re-posted on the Huffington Post gives a counter view and questions whether Chipotle really does serve “Food with Integrity”.

dbloom:

Love this Journal piece about the founder/CEO of the Chipotle burrito chain. Unlike their competition, they invest heavily in providing sustainably raised meat and produce, and it’s paid off with massive success, as customers pay more for good quality at what is still a very good price. The chain is now the biggest buyer of sustainably, humanely raised meat in the country. Very impressive.

Photo reblogged from classifiedhumanity: July 26th, 1902 The...

Sun, 30 Oct 2011 16:38:00 -0400

Photo reblogged from classifiedhumanity:

July 26th, 1902

The more things change, the more they remain the same. This article could very well be a news item in today’s paper. And to no one’s surprise, it actually is. This article from Crain’s NY Business touches on the same story.

The National Mobilization Against Sweatshops has been running a campaign for ten (yes, ten!) years called Justice Will be Served! (JWBS!). According to their site -

Chinatown restaurant workers were first instrumental in exposing the existence of sweatshop conditions in the U.S.

JWBS! has had some success with negotiating terms with the owners of the Zen Palate and the Golden Bridge restaurants.

But the problem still exists. Capital New York looks behind the “bulletproof glass” and reports on the staff at Chinese takeout restaurants in Mott Haven.

So, campaigns like JWBS! will be here for some time….

Wacky foods - real moneymakers

Wed, 26 Oct 2011 17:39:28 -0400

There is always a market for innovation and there is an even bigger market for humor. What happens when you combine the two with the fact that people love to try new things to eat? You could have a solid business proposition. And that is no joke.

CNBC’s Funny Business listed two “gifts” which were innovative - in that, they can tickle the taste buds and the jugular. But their creators are serious about the product offering.

Exhausted by the holiday? “Coffee is so 2009”, says the promotion for “Perky Jerky” — energy boosting beef jerky. The company claims the product was the result of an accident during a boozy ski trip when an energy drink spilled into an open bag of peppered beef jerky. The website is apparently marketing tired professionals, as its banner blares, “GET YOUR BOSS TO PAY FOR IT”.

Jacked up jerky may be the best food idea yet.

Or maybe this is.

Photo credit: pizzadonut.com

I present to you the Comfort Food of 2010: The Pizza Donut.

“Pizza Donut is garlic bread pizza in the shape of a doughnut,” says Richard Davis, President and CEO of Kosher International, which is selling the product to street vendors, claiming these donuts actually lower cholesterol.

I’ll have to take his word on that. I mean, it’s a pizza…donut…

“We use bagel dough and bake it, not boiling like a bagel,” Davis says. He adds that vendors can sell the product for “about a buck, like a NYC Kosher Hot Dog.” The profit margin on that? Sixty-six percent! That’s a lot of dough.

Restaurant Battles in the East Village

Mon, 17 Oct 2011 21:11:56 -0400

On a rainy Monday evening, a group of people looking for chicken tikka masala head towards a block on East 6^th Street in Manhattan. This block - dubbed Curry Row - is home to more than 10 Asian Indian restaurants. Mr. Gofur of the Raj Mahal restaurant greets them on the sidewalk and tries to usher them in. The group looks at the sitar placed against the window of the restaurant and asks if there is live music. As if on cue, sitar player Dileep Singh begins to play his set. The decision is made and they walk in. Gofur remarks, “Sometimes they come specially for the live music - and sometimes they don’t.”

The restaurants on Curry Row, mostly owned and managed by Bangladeshis, fall into two categories. The more upscale restaurants are at the street corners. They offer a full bar and charge higher prices. The second group, located opposite the Sixth Street Community Synagogue in the middle of the block, are easier on the wallet and serve only beer and wine.

Curry Row is home to Asian Indian restaurants like Spice Cove and Raj Mahal. Photo/Rashmi Raman

Raj Mahal, like its neighbors Spice Cove and Angon, belongs to the second category. While Spice Cove and Angon are trying to establish themselves under new ownership and management, Raj Mahal has been around for 15 years.

Raj Mahal’s business model hinges on competitive pricing. It has been offering prix-fixe dinners, discounts and promotional offers from the beginning. Although such initiatives have low profit margins, they still generated profits until the recession.

The current climate has not been good for business. Sales have dropped as the number of people eating out has fallen drastically. Costs have increased because of rising prices of produce and dairy. Their chicken tikka masala has been $10.95 for the past five years. Says owner Raj Mia, “If food price[s] increase, no one eats”.

Spice Cove and Angon are playing catch-up. Mr. Rehman says that there is “not much money in prix-fixe dinners, but we had to introduce it because of competition”. Spice Cove also offers the cheapest chicken tikka masala among the three - $9.95.

Angon, on the other hand prices its chicken tikka masala at $13.95. Nicolas Gomez, the manager says that the restaurant makes a $3 profit on the dish, but they need to sell 10-12 dishes of chicken tikka masala every day to justify the cost of the ingredients and the labor.

The ingredients are the most expensive component. For chicken tikka masala, it is the Garam Masala (a spice paste), heavy cream and cashew nuts that make up almost 40% of the cost.

The next highest cost is labor. Unlike Spice Cove and Raj Mahal, Angon did not need to hire chefs – the owners, Mr. and Mrs. Gomez, are the chefs. But they do need to hire servers, a sidewalk host and managers. Angon tends to hire students who have prior experience and can speak English as servers. Salaries start at $30 for a 7 hour shift plus tips.

For publicity, the restaurants rely heavily on reviews posted in news media as well as sites like yelp.com. They also use traditional practices like distributing the menu in a five-mile radius.

But nothing beats word of mouth. Lilly Magid, a customer who has visited Spice Cove four or five times, found the restaurant when she “stumbled upon this place”. She had “one meal and got attached”. She has recommended the restaurant to her friends who have also become frequent visitors.

Passers-by look at Spice Cove’s menu. After going through the menu for 5 minutes, they walked away. Business has slowed down for restaurants on Curry Row due to the current economic climate.

Photo/Rashmi Raman

The restaurants have to constantly introduce offers to interest customers. For example, customers who download coupons from Angon’s website can buy a discount coupon worth $25 for $10 to dine in at the restaurant. Raj Mahal offers a free bottle of wine or dessert with a meal. The owners are aware of the promotions offered by all the restaurants in the block.

Mr. Gofur, as the sidewalk host of Raj Mahal, plays an important role in generating sales. His job is to pull in passers-by. He uses persuasion, charm and sometimes persistence.

He spots a group of NYU students passing by and greets them with a “Hi, how are you?” He then goes on to tell the students about the prix-fixe menu “Best dishes….good for student budget,” he says. His spiel is succinct but persuasive. The students are convinced and he ushers them in.

While four years ago, he could pull in 150 customers per day, these days he can only attract around 60 to 70. On that Monday evening at 7.30, Raj Mahal was almost full, Spice Cove was serving three tables and Angon was empty.

The constant competition takes its toll, and Mr. Gomez says he’d like to sit down with his counterparts and discuss the rules of the game – pricing, ethics, viability of offers etc. While he does not want the restaurants to offer the same promotions, he feels the competition has forced Angon to come up with offers that hurt the bottom line. He argues that Raj Mahal, as an established restaurant, can afford the low prices but Angon cannot.

He approached Raj Mia and Mr. Rehman with the idea one month ago during a conversation and says that they initially thought it was a good idea. But both of them later concluded that they did not need this meeting as they were happy with the current promotions and pricing. Mr. Rehman and Raj Mia did not comment on this matter.

Notes :

NY state law does not permit restaurants within 200 feet of a place of worship to serve any alcohol other than beer and wine.

Mr. Gofur has lived in the area for 22 years. He was a restaurateur and part of this competition for 15 years before he had to sell his restaurant due to bankruptcy.

"Last year, more than a dozen San Francisco restaurants that levy surcharges each kept more than..."

Tue, 11 Oct 2011 12:41:00 -0400

“

Last year, more than a dozen San Francisco restaurants that levy surcharges each kept more than $100,000 that had been allocated to HRAs*, though in some cases the restaurants also offer health insurance to employees that isn’t paid for with HRA funds, according to city data. One Market, for example, allocated $118,799 to HRAs for its employees but only reimbursed $2,398. The restaurant says it spent an additional $10,248 on health insurance for employees.

(via gainfulunemployment)

”

- Investopedia explains Health Reimbursement Account - HRA -

As a benefit, an employee may be reimbursed for qualified medical expenses from his or her employer. The funds received are tax-free, but because the plan is employer funded, the employer has the right to cancel or alter the distributions at any time. In spite of this, many employees consider HRAs as a valuable benefit given the rising cost of health care.

Health insurance is a serious labor issue….this video from the Wall Street Journal takes on the issue.

Menu Surcharge Can Be Misleading - WSJ.com

Diners are charged around 3% of their entire bill—with a 20% tip and near 10% sales tax, diners pay almost 30% above menu prices for the food/beverage total. The burden is on the staff to fill out paperwork to be reimbursed from the restaurant’s allocated healthcare funds. Every dining check nets funds for the healthcare pot, but paperwork for these funds aren’t necessarily filed. The restaurant keeps the unclaimed surcharge as profit.

Now, whenever I see the healthcare surcharge line item in my bill I will think of how I’m lining the pockets of some rich restaurant owner/investor, not chipping into healthcare for the people who serve the food, wash the dishes, etc.

Jane of all trades, Master of none.: Recession - what recession?

Tue, 11 Oct 2011 12:38:00 -0400

Jane of all trades, Master of none.: Recession - what recession?:

Love a counter-trend story! This one is from various towns and cities in Maryland.

ohheyrebecca:

I feel like recently there has been a flurry of bars and restaurants being rehabbed, opened and/or moved. If this is an indicator of good times to come, you better go buy yourself a new drinking hat. Here’s a run down of places that have recently opened or soon to come in the Land of Pleasant…

You will now need to pay more for that jar of peanut butter

Tue, 11 Oct 2011 10:00:00 -0400

Another hot, dry summer has devastated this year’s peanut crop, sending prices for the legume skyrocketing and forcing peanut-butter brands

says the Wall Street Journal.

ABC KOAT reports that heat, strong winds and dryness that caused the failure of the peanut crop.

Peanut butter could now cost 30-40% more than last year because of the failed crop. So, you will need to pay about 94 cents more for the next jar of peanut butter.

Also, due to the shortage of peanuts, you may not find your favorite variety as brands like Smucker may host only a limited variety till next January.

The quality of the crop is also being questioned as also the fact whether your favorite peanut butter will continue to taste the same.

This could cause widespread buying of peanut butter as people will stock their shelves before the next batch comes in.

A sweet deal

Thu, 06 Oct 2011 09:28:00 -0400

US confectionery maker Hershey has announced a tie-up with rival Ferrero to share resources in stocking and distribution of their products earlier yesterday.

The aim behind this alliance is two-fold : increasing productivity by streamlining operations and reducing their carbon footprint. The effects of this move on the workforce at these two companies is to be seen.

The confectionery space does well during economic recessions - people turn to candy for comfort as reported by Christine Haughney in the New York Times.

Hershey has benefited from this trend. Investors.com has reported that Hershey will post “solid Q3 results”.

However, Forbes has reported that -

…despite HSY’s impressive performance on the charts, most of the Street remains sour on the stock. According to Zacks, only four out of 13 analysts consider the equity worthy of a “buy” or better rating, leaving the door wide open for potential upgrades to fuel future gains. In the same vein, Thomson Reuters pegs the consensus 12-month price target on the stock at a measly $61.42 — just a stone’s throw from HSY’s current share price.

The alliance between Hershey and Ferrero might be a precursor to further joint ventures between these two companies.

Business is in the black

Thu, 06 Oct 2011 00:17:00 -0400

Coffee prices have been rising since 2009. The highest price was recorded in May 2011. Photo by Rashmi Raman

The price of coffee beans has risen steadily over the past three years, creating a squeeze for mom-and-pop businesses like D’Amico Foods in Brooklyn.

In 2008, the wholesale cost of a pound of Arabica coffee beans was about $1.50 in the New York market. The price, stayed under $2 till July 2010 and hit an all-time high of $3 in May 2011; it hasn’t decreased significantly since.

The D’Amicos (L-R) Joanie, Frank Sr. and Frank Jr. share a warm moment. Photo by Rashmi Raman

D’Amico, which was rated “best coffee in NYC” by Zagat Survey in 2006 and 2008, has seen coffee prices swing back and forth before. D’Amico has been roasting gourmet coffee since 1948, though it started as a grocery store run by father-son duo Emanuele and Frank D’Amico Sr. They were soon joined by Frank Sr.’s brother-in-law, Alessandro Viola, whose roasting techniques are still used. Today, third-generation D’Amicos Frank Jr. and his wife Joanie run the bulk of the business.

Coffee sales overtook groceries and the D’Amicos phased out the grocery business to concentrate on coffee, both brewed and to take home, and small eats like sandwiches and cold cuts. Their e-commerce venture, started in the mid 1990s, is popular, just like their original mail order service started by Frank Sr. in the 1970s. About 65% of coffee sales orders come through the website. The latest addition to their business is wholesale delivery of coffee to about 100 restaurants and cafes in NYC.

D’Amico offers about 120 varieties of roasted coffee, ranging in price from $8 to about $13 per pound. But because D’Amico caters to a huge variety of aficionados ranging from dockworkers to lawyers and retired seniors, they have had to keep their pricing competitive.

Frank Jr. says that “coffee prices are crazy” and notes that Fair Trade coffee (a market system that links farmers directly to importers by eliminating middlemen) costs about 30 to 40 cents more than coffee bought in the open market.

While roasting their own beans helps lower some costs, pricing remains a balancing act. They had to increase the price of a cup by a quarter, a 25% change, last year (see graphic), even though bean prices increased by 33%. As a result, the store has seen a 15% reduction in profits on coffee in the past year.

The price hike was a drastic move as the rate had remained almost unchanged for about five years. While Frank Jr. has had to reason with some irate customers, he observes that most customers “are OK with the prices as they aware of what’s happening”. In fact, overall sales have increased by 20% this year as compared to the previous year.

Joanie notes that a cup of their signature Red Hook Blend ($12.29/lb) costs the same as that of the House Blend Light (8.39/lb) when brewed at the store. That is partly because brewed coffee isn’t a big part of their business. Indeed, 85% of D’Amico’s revenue comes from selling coffee that can be made at home, so they can afford to keep a common price for the brewed coffee and cater to the local clientele.

For customers like lawyer Meg Manchester, D’Amico represents a sense of old New York and a chance to strengthen ties with the community. Robert Painter, a customer for eight years, says “the place has so much character, the character bleeds into the coffee.” Longtime customer Alfonso Salas believes that “The neighborhood has changed and an institution like D’Amico needs to reflect that.” The store had a “more rustic” decor before Frank Jr. and Joanie changed the interior a few years ago. The D’Amicos realized that attracting the young professionals moving into the neighborhood was as important as retaining their more loyal customers.

The employees feel it too. Christian Lee Branch has been roasting the beans, and recommending coffee varieties, to customers for six years. For him, working for the D’Amicos is like “working with family”. D’Amico has never had layoffs, and some employees have stayed around for 20 years.

Employee retention, competitive pricing, its reputation in the community and multiple sales channels have helped build the brand. But the D’Amicos are looking for ways to expand the business and decrease overhead. They are considering ideas like discontinuing the sandwiches and increasing seating. They might also reduce business hours and hire more people because of their health concerns.

And the D’Amicos are aware that inflation and recession haven’t deterred consumers from getting their caffeine fix. Americans are even more passionate about it. According to the National Coffee Association of America, for every 10 cups of coffee consumed last year, four were gourmet. And while gourmet coffee costs more than regular, the profit margins are higher too.

The price of coffee beans has risen steadily over the past three years, creating a squeeze for mom-and-pop businesses like D’Amico Foods in Brooklyn.

Will your friendly neighborhood restaurant be around next month?

Thu, 29 Sep 2011 19:24:00 -0400

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.