Great Ideas for your Small Business: Get Help from a Restaurant Consultant
Isidore kharasch is a skilled chef, but most of his clients don’t even know he can cook. “I’m more comfortable managing the business end of a restaurant,” said Kharasch, president of Hospitality Works, a Chicago restaurant consulting and turnaround company.
He’s a very busy guy. About 27 percent of all restaurants fail after the first year, and 60 percent close down after five years, according to researchers at Cornell and Michigan State University.
About half of his clients own struggling restaurants. The other half are thinking of going into the restaurant business and need expert help. “Our goal is to either have you committed to doing it or abandoning it,” said Kharasch, who charges about $175 an hour. “I teach people how to take general costs, like rent, and then figure out gross sales.” He once helped a couple that was ready to invest $1 mil- lion in a pastry shop in downtown Chicago. “By the end of the evening, I showed them that they would need to have 600 people spending $7 per person, seven days a week, for them to make any money,” said Kharasch. “They were ready to sign a lease, but they spent $800 for one night with me and walked away with their $1 million.” He said there are many reasons a restaurant fails. Leading the list are poor design, poor location, overstaffing, and no cost controls.
Kharasch does enjoy many successes, too. When we spoke, he was on a two-month contract at $2,500 a month to help a troubled restaurateur. “We found $300 a week in misspent dollars right away, which pretty much paid our entire tab for the consulting,” he said.
In fact, he said his clients usually save between ten and twenty times the amount of money they spend with his firm.
He now has three full-time and twelve part-time restaurant experts on his team and is working in twenty-three states and abroad.
“Izzy conducted a search for us and hired our chef and general manager,” said the manager of O’Grady’s in Arlington Heights, Illinois. “He also made drastic revisions to our kitchen design.” Kharasch’s reputation for improving customer service is spreading beyond the hospitality business. In 1997, he began offering training and seminars for banks, law firms, and hospitals. “They are learning about hospitality as a way to beat competition, and it has nothing to do with food,” he said.
Kharasch’s tips for restaurant owners
- Reduce the number of managers you hire by reorganizing your schedule.
- Make sure the kitchen is designed to let the chef easily supervise cooking and to get the food out to customers fast.
- Make sure your menu is easy to understand, and promote high-margin items like appetizers and desserts.
- Insist bartenders measure the alcohol they pour. Bartenders who pour using guesswork “drain a restaurant of profit.”
- Be sure your staff is well trained and motivated to provide good, friendly service.