There are a few good reasons and many wrong reasons to start a new restaurant business.
If you’re thinking about starting a new restaurant and at least one of these applies to you, you may want to rethink yourself!
Wrong Reason to Start a Restaurant #1: I want to get rich (fast)!
There’s a reason 1 in 4 new restaurants fail within a year, and 3 in 5 will fail within the first 3 years*. Most restaurants just never end up making enough money.
As a whole, the restaurant industry’s overall profit was 5% in 2013. With the average restaurant doing about $800K according to the National Restaurant Association, that means the average restaurant made ONLY $40K in profits in 2013. It’s better than zero, but it’s a long way from making an owner rich.
Why? Because for every dollar you collect from a customer, most of it needs to go cover the cost of the ingredients, labor, rent, taxes, insurance, utilities, repairs, advertising, etc.…
If you’re looking to get rich, there are many other industries with better odds.
Wrong Reason to Start a Restaurant Reason #2: I’ll be cool and hip owning a restaurant
What are you picturing? Spending on a handful of hours a week at the restaurant? And when you’re there, you’re just high fiving customers and counting your cash?
Owning and operating (especially true if it’ll be your very first restaurant) a restaurant takes a lot of time and energy. It’s hard work. Go find new restaurants in your area and observe the owners. Do their faces exude relaxation and fun?
Wrong Reason to Start a Restaurant Reason #3: My family and friends LOVE my cooking!
Just because you know your way around your own kitchen at home doesn’t mean you know how to run a business, let alone run a kitchen for a busy restaurant.
Can you do what you do every day? On weekends? Even holidays? How about serving 50 strangers? Or 100+? Can you hire, train, motivate, and also fire employees? Do you know how to manage and optimize your costs?
Knowing how to cook isn’t necessary for starting and running a successful restaurant. What is required is to understand what it takes to start and run a successful business.
Wrong Reason to Start a Restaurant Reason #4: You want to prove someone wrong
Did you tell someone that it’d be nice to own and run your own restaurant and they said to you that you should reconsider? Well, we’re telling you the same thing. Do you want to prove us wrong too?
Do you want to bet your savings, time, and energy on something JUST to prove someone wrong? Motivation is overrated and fleeting.
If you don’t have a handful of BETTER reasons to start a restaurant than this, don’t do it! You’re definitely not going to enjoy the process, and you’re most likely also to prove your doubters right.
Wrong Reason to Start a Restaurant Reason #5: I’ll have more flexibility and free time
At some point, you may find that but for a first restaurant and especially before it is consistently making enough sales for you to hire and train a capable store manager while still making a good profit margin, you’re going to be working more. A LOT more than a typical 9-5 gig.
You’ll be getting up early to prep for opening and then staying well after closing to clean up and close shop. Remember evenings, weekends, and holidays off? Well, you can forget about that.
Wrong Reason to Start a Restaurant Reason #6: I won’t have a boss/I’ll be my own boss
While starting your own restaurant means you will be the owner and be calling all the shots, you must recognize what you’re also signing up for by being the boss.
It means you are ULTIMATELY responsible for EVERYTHING. As the boss, you’re ultimately responsible for generating sales, marketing, controlling costs, hiring, firing, all policies and procedures, growth, taxes, bookkeeping, etc.…
Wrong Reason to Start a Restaurant Reason #7: I want to have stability in my life
Talk to any restaurant owner just starting or building their first restaurant and ask them how much stability they have.
Starting and running your own restaurant could be one of the most stressful and chaotic things you ever do. You could go from having no customers to suddenly way too many to handle. Out of nowhere, your cook gets injured, the line backs up, customers are unhappy, bad Yelp reviews, and you start losing business.
Owning and running a stable, well established and profitable restaurant can provide stability, but starting one and trying to build it into that is anything but easy.
Wrong Reason to Start a Restaurant Reason #8: I’ll have a place to chill with my buddies
Okay, stop there. If this is your number one reason for wanting to start your restaurant, then first pour yourself a glass of iced water.
Now pour it all over yourself. You awake yet?
Owning and running a restaurant means you’ll be running a business.
So unless you want to ruin friendships AND your new restaurant business, you won’t want to be hanging out with your friends at your new restaurant all the time. Either you’ll get tired of comping their meals, or they’ll get tired of your requests to “hang out” at your restaurant just to boost your sales.
You’ll end up losing your friends, your restaurant, or both.
So, how many of these applied to you? If even one of them was the primary reason you’re thinking about starting a restaurant, then you’ll need to really do some reevaluating.
Tell us what you think, what are some other wrong reasons to start a restaurant business