A vital sign in any restaurant is the operation´s profitability possibilities. On Monday I wrote about the husband and wife team that would run a restaurant together. Kranston quickly pointed out that one of the major obstacles in the partnership duo is the total loss of income if things go south in your business. With one partner working, what I often for another employer there is at least one paycheck coming into the house when the restaurant has a bad week, month, season, or year. And those are all feasible scenarios.
That brings us to the difference between success and profitability. There are many successful operations in existence that do little more than pay the bills and allow the owner a meager salary along with some perks such as the daily consumption of good food, strong coffee, straight liquor and a never ending line of friendly acquaintances. And for some operators, that is enough to sustain them in a pleasant lifestyle. But is it really a successful operation? That of course is in the eye of the beholder.
Planning for the future is the most difficult dimension hospitality business. Developing a game plan that has all the elements of success written into it is easy enough to do. Predicting the variables- the weather, the economy, the growth of competition, the ability to hire, keep, train and professionally develop a staff focused on consistency are frequently the arising problems that you seldom can plan on.
That´s why it is very important to differentiate between profit and success. Obtaining both is pure business bliss. You can accomplish one goal without the other. Your successful operation could be packed every night and the salary you take supports yourself and your small family. But, you never turn a profit larger than the salary that you take. That is success but you need to think about a profit-your salary is an expense that you are entitled to. Do not confuse culinary notoriety and success with profitability.
On the other side of the equation you could be running a very profitable restaurant but the concept may be one shade off, the clientele may be different than you envisioned, and you may not enjoy spending time in the place. Is that a successful venture? Only you can decide.
When thinking about that new venture, make sure you define your needs and goals.
Some owners look towards success, others look towards profitability. Profitable success is the ultimate goal.