Businesses to be in or not to be in? Future of restaurant business?

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  • Mon, Jun 13, 2011 - 05:40pm

    #1
    momofseven

    momofseven

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    Businesses to be in or not to be in? Future of restaurant business?

I have just finished the Crash Course.  It is a lot to take in.  

We live a pretty simple life and the farm and are fairly self-reliant, but we just opened a pizza restaurant in a small community.  We are hoping for the best – that business will increase over time and our children that choose to be a part of it will have a means for providing for their families.

This has been possible for previous generations, but as the Crash Course states, things will most likely not be the same in the next 20 years as they have been.

Just wondering what some of you think about the restaurant industry.  Is it doomed to fail?  Or will low cost food options fair well as people are more busy and have less time to cook?  Or maybe we won’t even be able to afford to buy food for our restaurant?  

Any thoughts?

Sorry if this has already been covered.  I couldn’t find a way to do a search in the forum.

  • Mon, Jun 13, 2011 - 06:16pm

    #2

    Johnny Oxygen

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    Hi cpuetz

Welcome to CM

The search box is in the upper right hand corner of the home page. The small white one.

IMO a local pizza shop in a small community could fair well as long as costs are kept down. Pizza is rather simple and goes a long way.

I think the places like McDonalds will survive but mid level restaurants Like Applebees will go under.

Perkin’s and Marie Callenders just filed bankrupcy

http://www.sltrib.com/sltrib/money/51996405-79/perkins-marie-bankruptcy-callender.html.csp

On the other end I think the very rich will support high end restaurants or at least some of them.

In your case I think the issue will be more of an overhead problem.

Thats just my opinion. I’m no expert.

  • Tue, Jun 14, 2011 - 12:40am

    #3

    deggleton

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    The 3 Ps: Post Peak Pizza

All the way to peak, there have been places to eat other than at home. During most of the period, most working people did not go far from home regularly. Dining out was very special.
Your shop will persist longer than those of competitors if your ingredients travel less far, your pies are evidently more nutritious and your oven is wood-fired.

  • Tue, Jun 14, 2011 - 01:43am

    #4

    RNcarl

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    Post peak pizza! – love it!

[quote=deggleton]All the way to peak, there have been places to eat other than at home. During most of the period, most working people did not go far from home regularly. Dining out was very special. Your shop will persist longer than those of competitors if your ingredients travel less far, your pies are evidently more nutritious and your oven is wood-fired. [/quote]

  • Tue, Jun 14, 2011 - 03:41am

    #5
    momofseven

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    3 p’s

I’ll have to think on this a bit!

  • Tue, Jun 14, 2011 - 07:04am

    #6

    Poet

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    I Love Pizza!

[quote=momofseven]

…We just opened a pizza restaurant in a small community.  We are hoping for the best – that business will increase over time and our children that choose to be a part of it will have a means for providing for their families.

Just wondering what some of you think about the restaurant industry.  Is it doomed to fail?  Or will low cost food options fair well as people are more busy and have less time to cook?  Or maybe we won’t even be able to afford to buy food for our restaurant?  

[/quote]

Welcome to the community! I hope you can take some time to fill us in on how you found us in the thread I’ve linked to below:
https://www.PeakProsperity.com/forum/how-did-you-find-out-about-crash-course/58300

As to your question, Subprime JD’s family runs a few restaurants in Southern California, and he had some comments about rising prices.
https://www.peakprosperity.com/comment/97952#comment-97952

Here’s another comment he had about how restaurants that were bringing in $40,000 per month are now bringing in far less (as an aside to his tale):
https://www.peakprosperity.com/forum/pre-crisis-now-how-crisis-has-impacted-my-life/57114

I don’t know enough about your pizza place or your community and its economy to be able to give you an opinon of your restaurant’s prospects. But personally, economics plays a huge role. Since our babies were born last year, my wife and I have really cut back on eating out.

I’m in charge of earnings and major bills. My wife is in charge of the grocery budget. If we eat out, then we have that much less for household supplies, baby stuff, and regular food. We may go to a restaurant when relatives invite us, but we try not accept their invitations, because then we’d have to reciprocate.

P.S. Round Table Pizza is my favorite. I love the Gourmet Veggie or the King Arthur on skinny crust.

Poet

  • Tue, Jun 14, 2011 - 01:29pm

    #7
    PastTense

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    The economy is liviing

The economy is liviing beyond its means (the government is running up massive debt…). With peak oil, enery costs will explode. Health care costs are exploding. With baby boomer retirement, there will be a massive increase in Social Security payments, etc. The result will be people will have a massive decline in discretionary income. Restaurants will go back to what they were several decades ago–where you only went out to eat for a special occasion.

If you are making good profits with your restaurant, continue with it. But if you aren’t making any money now, but are expecting to become profitable in three or four years I think you are making a mistake. A key question is how leveraged you are. What happens if sales decline 25%? If you respond that your income will drop 40%, fine. But if a 25% decline means you will change from making a moderate profit to heavy losses and won’t be able to pay your fixed bills, then there is a high probability you will fail.

  • Tue, Jun 14, 2011 - 02:31pm

    #8
    kaman

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    A small pizza joint may work

A small pizza joint may work if you can keep your overhead down and possibly offer delivery for lazy impulse eaters.  Go after business instead of waiting for it to enter your front door;  as in providing for sporting and public social events, birthday parties, graduations, work offices, etc.

The type of sit-down restaurants I see usually doing the best in tough times are breakfast and maybe soup-n-sandwhich lunch types where inventory is cheap and small as compared to those serving dinners and multi-course meals (soup/salad, entree, dessert) that involve twice the work/cost/inventory/personnel/table space & prep time.

  • Tue, Jun 14, 2011 - 05:37pm

    #9

    Travlin

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    Echo Kaman

[quote=kaman]

The type of sit-down restaurants I see usually doing the best in tough times are breakfast and maybe soup-n-sandwhich lunch types where inventory is cheap and small as compared to those serving dinners and multi-course meals (soup/salad, entree, dessert) that involve twice the work/cost/inventory/personnel/table space & prep time.

[/quote]

I’m thinking along the same line as Kaman.  I don’t know the food business, but something like a basic diner seems to fill a need that will not go away.  Not everyone can be at home at meal time or carry a meal with them.  Simple and inexpensive food will always be in demand.  Pizza fits this need for one or two meals, but you could consider adding breakfast and simple lunches as a way to transition into a broader and more stable market.  You could still keep pizza too.

Travlin 

  • Tue, Jun 14, 2011 - 07:24pm

    #10

    Johnny Oxygen

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    mmmmmmm

Please send me some

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