Honesty and clarity across the board, setting priorities and having a great legal mind on your side were among the thematic takeaways from a special discussion jointly hosted by Journee and Open Table. Panelists included Alison Arth, Founder and Principal of hospitality consulting company Salt & Roe; Georgette Farkas, owner of Rotisserie Georgette; Journee Founder Anthony Rudolf; and John Winterman, Managing Partner at Batard. Best practices on crafting business plans and the care and feeding of investors were just a few of the talking points.
Winterman said he believed constructing an honest, realistic business plan is a crucial element for any fledgling restaurant. He added that aligning the budget with the calendar is a savvy move because it enables owners to more accurately plan for expenses such as labor and food.
“Under promise and over deliver,” Winterman advised. “Investors are looking for honesty. Our business plan was based on realistic growth.”
When opening her restaurant, the frugal Farkas looked for ways to conserve costs that would not impact the guest experience or cause staff aggravation. She selected “sturdy, durable” Buffalo China and uses no tablecloths, but splurged on pieces of carefully curated silverware and high-quality napkins due to their tactile natures. She also opted for a reliable, but unattractive espresso maker and a second-hand rotisserie she affectionately refers to as “the Toyota in the back.”
A few questions she keeps in mind when making purchasing decisions: “Will what you spend make the dinner more delicious, more memorable? Is this about somebody’s ego or will it help the staff do their jobs better?”
Arth noted the importance of bringing on an attorney with knowledge of the hospitality industry as early as possible in the process to serve as “your cabinet of resources.” She also advised aspiring restaurateurs to set themselves up a business to protect their assets. Farkas added that an attorney familiar with the language of leases is critical when negotiating with landlords.
On the subject of raising capital, Rudolf suggested looking for partners as opposed to simply investors. “It’s no different than a marriage. What do you want in a partner? If you don’t see eye to eye, will they be by your side when the downturn comes?”
Arth agreed investors should be selected with caution.
“Be mindful of who your investors are,” said Arth. “Don’t just take money from anyone. Go into business with people you trust. Investors need to feel connected. You don’t do it for a monetary payback, you do it because you fall in love with the process.”
Rudolf pointed out the restaurant industry is based on “learning through immersion” so it comes as no surprise the panelists took note of on-the-job lessons acquired from the likes of Thomas Keller and Daniel Boulud.
Rudolf credits observing Keller’s clarity in language as being a life lesson for embarking on any business endeavor. “Language frames your thoughts; thoughts frame your actions. Know what’s important to you.”
When you have a chance to observe someone like Keller, he added, “You see better habits, steal from them and make them your own.”
Winterman praised Boulud’s spirit of generosity, citing an example where Boulud would take the time to sit down with anyone on staff, listen and respond, even while his phone would keep buzzing away.
“At the end of the day, business would not suffer or lose from being generous,” added Farkas, who also worked for Boulud.
Arth teamed with Open Table to create How to Open a Restaurant, a free, downloadable guide on starting and growing a restaurant business that features advice from the industry’s top hospitality groups and restaurateurs.
Moderated by Open Table’s Content Marketing Manager Olivia Terenzio, the discussion was held at Journee’s home base in New York’s Flatiron District. The membership-based community for restaurant industry professionals features a calendar of eclectic classes, guidance from industry veterans, as well as access to collaborative space. To learn more, visit www.yourjournee.com.