Restaurant Investing

Restaurant Investing

  • Submitted By: hpatt
  • Date Submitted: 01/31/2011 5:50 AM
  • Category: Business
  • Words: 549
  • Page: 3
  • Views: 218

Restaurant Investing
by Henry Patterson

Take this quiz: What do you really think of weekly inventory taking?
a) Ridiculous distraction
b) Nice in theory, but when the realities of coping in the kitchen set in, it probably won’t happen
c) It’s essential to the way I operate

The range of answers here is not a range from wrong to right. It is better understood as emblematic of a range of cultures, cultures of Invention, of Craftsmanship, and of Deal Making. The values of these cultures are roughly tied to stages of business development. Understanding this is key to gearing the expectations of anyone who invests in a restaurant.

Perhaps looking at business in another context would be helpful: In the world of high technology, the landscape is peppered with small labs owned and operated by passionate technologists. They live and breathe their scientific specialties, and the culture of their shops is a culture of invention. The lab revenues are hardly sufficient to support the participants, but exciting new technologies with enormous potential are being developed. Sound like some young chefs you know and admire?

Some of these labs get the minimal backing they need to transition to the next stage, where working models of the invented technology are built. In the high tech realm, the main thing at this stage is really to prove that the technology works. The driving values of these labs transition from those of the inventor to those of the craftsman. The company is still led by the chief technologist, who still respects invention and indeed is driven to continue it. However, the main focus is the creation of reliable prototypes to prove out prior inventions. In our world, this is akin to a healthy single location restaurant, led by a chef/owner. It may now make enough money to support its payroll and sustain itself, but it is still a marginal investment proposition. The friends and family who made it possible get treated well when they come...

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