Wednesday, September 29, 2010

Never Let Them Have You By The Balls!

“Never let them have you by the balls!” That’s what a friend, who owns several restaurants, said when I first bought the restaurant in 2002. Back then I wasn’t 100% sure what he meant, in the years to come, it was definitely a lesson I would learn many, many times over. You definitely need to learn how to do every job so no employee can ever have you by the balls!

As I was standing in the dining room of the restaurant I had just bought, staring at my drunken chef on the floor, barely conscious, I realized that this was one of those moments. Chef knew that the former owner had no one else who could cook his food, so he did whatever the hell he wanted. He had the world by a string, or at the very least, the owner by the balls. It was at that moment I made a quick decision (one of many self-destructive, impulsive decisions I would make over the years). I walked over to where my drunken chef was sitting, and told him, “I now own the restaurant and you’re fired!” Over the years, I have learned the consequences of impulsive decisions and the benefits of taking your time, finding replacements and, most importantly, the art of not cutting off your nose to spite your face. As of that moment, I had to open up the next day with no nose and now, with no chef.

As the shift came to an end, I asked the staff to stay so we could have a quick meeting. Everyone grabbed seats in the small, private dining room on the second floor. My wife and I told them the news: that the prior owner was no longer involved and we were taking over. We told them that we fired the chef and would be searching for a replacement as quickly as possible, then asked if anyone had any questions. I didn’t know how they would react. No one really had questions. I didn’t know what they were thinking. And then they told me that they just wanted to celebrate -- their freedom from the prior owner and the drunken, nasty chef. They were excited about working for my wife and me. Some even said they had been about to quit, but now they want to stick it out and see where things went.

I felt good. I convinced myself that I had made the right choice and everything was going to be okay. Honestly, I felt… like having a cigarette. For the first time in three years, I wanted to smoke. I don’t know why. Maybe it was to celebrate with everyone, maybe to calm my nerves, or maybe it was just to look cool. But, I felt like to Tony Soprano choking on a big cigar with a sh*t-eating grin...only I did the same thing with a tiny cigarette and “oh-sh*t-what-did-I-get-myself-into” grin! Unfortunately, it would be the first of many “oh-sh*t cigarettes” to come.

Monday, September 20, 2010

Now I can say I Own The Restaurant

It was the first week of October, 2002. Technically, my wife and I didn’t yet own Avalon. However, we were spending a lot of time at the restaurant, working for free, evaluating employees and worrying about sales. In my opinion, I would say that is as close to owning a new restaurant as one could get without actually owning the restaurant. The kids were back in school (we are located in a college town) and business was starting to pick up from the slower summer months. Paperwork for the purchase was drawing to close and we anticipated making our announcement in just a few weeks.

I was starting to sense the owner’s frustration that we hadn’t yet sealed the deal. For him, a few more weeks might as well have been three years. It seemed to me that Avalon was one giant headache to him and I was the Advil sitting on a shelf – just out of reach. So, one Friday evening in the middle of service (and no signed deal), he looked at me (after yelling at his drunken chef), put a set of keys in my hands and said, “Tell everyone tonight the place is yours” and left.

As I thought about the big employee announcement we would make, butterflies started to kick in my stomach. How would we tell everyone? What would we say? What would they say? The answers to those questions would have to wait -- as my first crisis as restaurant owner was starting to unfold in the dining room.

With only a few tables left to order and the restaurant still fairly full, the chef decided he was going to venture out into the dining room. As I watched him stumble and almost fall down a set of steps, I became curious as to where he was going and what he was going to do. I watched as he went from table to table, talking with guests. All seemed fine until one of the servers said to me, “You need to get him out of the dining room; he is smashed and making no sense.”

As I watched him stumbled to the next table, I knew I had to quickly -- and quietly -- get him out of the dining room and do damage control. This task probably would have been a lot easier if my incoherent chef wasn’t asking a table who hadn’t yet ordered how they enjoyed his food. I told the chef he was needed in the kitchen and without an argument he left the table. As I was apologizing, one guest simply laughed, looked at me, pointed and said, “I think you have a bigger problem.” I turned around only to find that my chef had never made it back to the kitchen. He decided to sit on the very steps he almost fell down, lie back and pass out in the middle of a full dining room.

Standing over him, with my hand in my pocket squeezing my newly acquired keys and looking around at the staff, my wife and guests, my only thought was … now I can say I own the restaurant!

As I look back now, as more seasoned restaurateur, it would be easy for me to point out the shortcomings of the restaurant. All the red flags waving in my face: purveyors weren’t being paid quickly enough, waitstaff was disgruntled and the kitchen was a cluster of drug and alcohol abusers. But to someone young, blinded by ambition and stupid, this felt like the greatest adventure ever.


Before purchasing Avalon, my restaurant, back in 2002, I used my immense knowledge of business and incredible savvy to negotiate a fair market price. Labor reports, sales reports, P&L statements, rent, property tax, pass-through fees, lease type, insurance? Clearly just from me throwing these few terms around, you must I think I was smarter than the average bear. At least smarter than I had appeared in my first blog post. Right? Wrong! I was about as dumb as they come.

I had about three or four meetings with the prior owner before moving forward with the purchase. We always met at the restaurant, and he went out of his way to make me feel special. His staff treated me like I was a king. He had a relaxed, calm, dominating power that is hard to put into words. I always had a list of questions for him that somehow, managed to get averted. I hate to use the phrase “smoke and mirrors” but this guy was a regular freaking magician. For example, I would ask about the sales, (the only real question of substance I had anyway) and he would give a vague answer, something like, “the sales are really good,” then, with a quick-witted diversion, he would go on to say “but if you started doing lunch and open seven days…my God, Johnny, you would make so much money it’s unbelievable, man.” He would then signal for a waitress and suggest that we order something from the kitchen. After dessert, a few cigarettes and a cup of coffee, my concerns about sales passed. He always controlled the conversation without making me feel like he was controlling the conversation, a regular Svengali. Suffice it to say that I left each meeting feeling more and more excited about the restaurant. However, I never learned anything about the business.

At one point in our last meeting, I remember asking him once again about the numbers. Not really knowing how to ask, I simply said, ”So what are the sales?” This time he looked at me, smiled and pulled out his briefcase. As he opened it, he said in his thick European accent, “I don’t know exactly, but I can show you this…” and he proceeded to unveil two rather large piles of cash and a stack of papers. He handed me the first twelve months of credit card deposits from the restaurant sales. Finally, I would get to see some figures in black and white and I was dumbfounded. The totals of the Visa, MasterCard and Amex checking account deposits seemed quite large and that didn’t include the cash sales. One thing was clear to me at this point: He seemingly barely worked, walked around with a briefcase that had a few thousand dollars in cash in it and his total monthly sales without cash were about $50k. There was no way could I screw this up, or so I thought. The rent is $3,000, my loan is $2,900, food cost would be based on sales….this was a no brainer. Cha-ching!

While sorting out the last of the legalities, my wife, Michelle, and I started spending more time at the restaurant. The prior owner didn’t want the staff to know what was going on until everything was finalized, so he introduced us as the new manager and hostess to the restaurant. As the big announcement drew closer, the prior owner had some last bits of advice: “To make the transition smoother, make sure you let customers think I am still involved,” he said. “Better yet, just tell them you’re the new manager and keep the name the same “In fact, if I were you, I wouldn’t change anything. Keep the chef, the menu, the d├ęcor and the name.” Since he built the restaurant, had all the cash and seemingly knew way more about the business than me….we decided to keep everything the same. All I can say now, eight years later, is ….how dumb could one person be? Screw the restaurant advice—teach me how to be Svengali!