Wannabe restaurant owner, here's a few terms you'll need to learn, and this is for you that never worked in a restaurant, and never ran a business, and you just want to own a restaurant...good luck buddy.
Here's some key terms.
CASH FLOW- This refers to the movement of money within your operations, such as your income, what you're making for the day, week, month etc. And it is about what you're paying for, or your expenses. Hire a very competent accountant that will make sure every cent is accounted for. Make sure he or she also is paying all pertinent taxes, local/state/IRS etc. I've heard of many naive business people trusting a not so competent accountant that did not pay all pertinent taxes and bills, only to get bitten big time in the ass later with penalties and fines, and even possibly jail time. Do not F around with the money situation! This is business. Be professional. It is your money, you are hiring these people to do their jobs. Cash flow is the lifeblood of the business.
Please get advice from anyone in a successful business, network in your locale, go to business luncheons, get to know other movers and shakers in your area. I bet you'll hear some very horrific stories about business.
CASUAL DINING RESTAURANT- Exactly what it says, are you setting up a high end gourmet eatery, or are you doing casual? Full serve casual serves foods that everyday folks want to eat, the whole ambience is very laid back, friendly, family themed. Wait staff is dressed casually, shorts, t-shirts, women maybe in tank tops if it is a warm locale. The foods can range from sandwiches, to hot meals cooked to order such as pastas, or other ethnic dishes served simple. You'll probably have more success in these economic times to start a casual diner as opposed to a high end joint. More people will be inclined to eat a seafood pasta that runs about 14.99 at a casual establishment as opposed to spending nearly 30.00 for the same product that's on a nice fancy table with silverware.
COMPENSATE or COMP- In the restaurant business if a customer is not satisfied with his meal for example, his pork loin with wine sauce was tough and was not appealing, the manager on duty may offer something for free, maybe a glass of wine, or a dessert, or a free meal the next time they visit. It is to make the customer happy, so of course they come back. Imagine if you went out do dine, your rib eye was hard and dried up, and the restaurant didn't compensate you, what would you be feeling? I'd feel sick. "I paid 19.00 for this piece of .... and I get nothing?"
COST OF GOODS SOLD or COGS- The costs associated with producing the foods you will be selling off of your menu. What does it cost to make a rib roast with the au ju, and the cost of serving it? There's always a cost for everything you'll sell, find out what it is. Some restaurants get really anal and charge for a small pat of butter. Why? Because being a ruthless business person can payoff. If there's 100 pats of butter in a case, and it costs an x amount, each pat has a price on it, if you give it away, you're losing money. It depends on how you price your meals, some restaurants will slightly price a meal a little over but not too obvious, so with that they can afford to hand out some free stuff like an extra packet of mustard or ketchup. Once this gets out of hand, this is where charging for these things comes into play. I've seen a pizza place charge for extra plates a while back. Now remember, it is your money invested in your restaurant, or investors, your job is to turn a profit. Well, breaking even is more the goal, and then profits. First things first, you have to have extremely good quality stuff being sold. As my friend Peter who's in the food business always says, "You can't break even on lousy food, if you can't break even you won't turn a profit, your job is to get quality in place first before you start thinking profits."
Here's some key terms.
CASH FLOW- This refers to the movement of money within your operations, such as your income, what you're making for the day, week, month etc. And it is about what you're paying for, or your expenses. Hire a very competent accountant that will make sure every cent is accounted for. Make sure he or she also is paying all pertinent taxes, local/state/IRS etc. I've heard of many naive business people trusting a not so competent accountant that did not pay all pertinent taxes and bills, only to get bitten big time in the ass later with penalties and fines, and even possibly jail time. Do not F around with the money situation! This is business. Be professional. It is your money, you are hiring these people to do their jobs. Cash flow is the lifeblood of the business.
Please get advice from anyone in a successful business, network in your locale, go to business luncheons, get to know other movers and shakers in your area. I bet you'll hear some very horrific stories about business.
CASUAL DINING RESTAURANT- Exactly what it says, are you setting up a high end gourmet eatery, or are you doing casual? Full serve casual serves foods that everyday folks want to eat, the whole ambience is very laid back, friendly, family themed. Wait staff is dressed casually, shorts, t-shirts, women maybe in tank tops if it is a warm locale. The foods can range from sandwiches, to hot meals cooked to order such as pastas, or other ethnic dishes served simple. You'll probably have more success in these economic times to start a casual diner as opposed to a high end joint. More people will be inclined to eat a seafood pasta that runs about 14.99 at a casual establishment as opposed to spending nearly 30.00 for the same product that's on a nice fancy table with silverware.
COMPENSATE or COMP- In the restaurant business if a customer is not satisfied with his meal for example, his pork loin with wine sauce was tough and was not appealing, the manager on duty may offer something for free, maybe a glass of wine, or a dessert, or a free meal the next time they visit. It is to make the customer happy, so of course they come back. Imagine if you went out do dine, your rib eye was hard and dried up, and the restaurant didn't compensate you, what would you be feeling? I'd feel sick. "I paid 19.00 for this piece of .... and I get nothing?"
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