Wednesday, March 9, 2011

Robbing Peter to pay Paul

This is my story of owning a restaurant from day one. It starts back in 2002 and includes all of my heartaches, triumphs, ups-and-downs, sacrifices, financial struggles and more.

In a college town like West Chester, Penn., where Avalon is based, most everyone goes home for the summer, making it a slower time for businesses. It was 2003, and we had been running our new menu for a few months. The response from customers seemed pretty good. Weekdays were still very slow, but weekends were consistently busy. To me, the kitchen still seemed rushed, but I managed to convince myself that this was the norm for the profession.

The restaurant’s financial situation, however, was a whole different story. Every day was critical and there couldn’t be any missteps. You see, my new business model was to rob Peter to pay Paul, pay Peter back tomorrow, then rob him again the same day. It was like living the life of an embezzler: You can never look away, not even for a second; you must always be two steps ahead of everyone else, and never a day off. One bad weekend of business and I could be finished.

Each day started with me getting out of bed, grabbing a cup of coffee and running to my computer. I logged into my bank account, not to see how much money I had but to see how negative my account was. I would look to see what checks were being presented to my account that day. Then, I would decide which checks I could afford to let bounce and which ones meant I needed to run to the bank and make a deposit to cover. I quickly became a master of banking (for people with no money, that is.) I learned which banks gave me extra time by re-depositing bounced checks twice (this means I give you a check, you deposit it, it bounces but your bank gives me a second chance before letting you know.) I also made sure I befriended the right branch personnel, so I could make deposits in the morning after the checks were presented and get the bank to still pay them.

Each day I would take the money from the prior night’s receipts and make a deposit. This was usually enough to get my checking account just on the positive side. The next day, new checks would again drain the account to a negative amount and I would repeat the process all over again. If I wanted the checks to bounce (because I knew they would get re-deposited a second time and I could use the money for something else) I would make the deposit later in the day, after the checks were returned. This way, I could use the little money I had for the most gain.

Oh yeah, did I mention that the bank would charge an additional fee of $30 per bounced check? At 5 or 6 checks a day, that added up.

This is a perfect example of how desperation in this business causes you to live in the moment. How we can easily end up in vicious cycles that cause us to be blind to a much bigger picture. I would manage each day to get new product in the doors, pay checks with no or very little money and never think twice about paying almost $2,000 a month in overdraft bank fees. My own solution was creating a much bigger problem. With one week of really bad business, the domino effect could be devastating.

Each day presented a new battle that I needed to overcome. I would revel when Saturday morning arrived. You see, Saturday had everything to offer: No checks are presented to the bank over the weekend, the electric and phone company won’t shut off service on those days and most importantly, I would receive a small cash injection that would (hopefully) get me through another week.

By Monday morning, after finishing my weekday banking routine, I’d be wondering why business was so good over the weekends and so slow during the weekdays. My food must be good, otherwise why would so many people come on the weekend? I realized that I needed something to boost the business, something that would bring in more business during the week. I needed that extra cash injection that would break this cycle and free me from the jail I was living. Some type of quick fix. Later that day my prayer may have been answered. I received a phone call from Philadelphia’s most important food critic….I was being reviewed!

In addition to being an irreverent blogger, John Brandt-Lee is chef/owner of Avalon Restaurant in West Chester, Penn.. Don’t worry, over the past 9 years, he’s learned many lessons and grown into a successful restaurateur. He just announced that he’ll be opening a second restaurant, Avalon’s Pasta Bistro, in Downingtown, PA in the Spring of 2011. Keep reading for more about how he went from a clueless restaurant owner (in 2002) to a thriving restaurateur, today.