Country Hams

This morning my father-in-law (Buzzy Neil) and I hung our country hams in our smokehouse here at the house. Thought I might include some pics right quick. These ain't the best pics and Lord willing I'll have some better ones later on. These hams will be ready to eat next christmas. We're cold smoking them right now for a month. They've been curing for the past month in the smokehouse.

Biz Blog #2: Food Costs

As I keep blogging about the business side to this thing, one constant you will notice is having to be disciplined about your % costs.  There is a window for everything and you have to stay within that window or you are about to screw up.  Food and Labor are your two biggest costs.  those two should make up around 55-60% of your costs.  Assuming you are planning on opening up a BBQ joint, one that is quick-casual like we are set up, you are looking for food costs to be around 23%-28%.  Full service dining is always going to be higher, so if you are going to have servers and such you will probably add a basis point or two to that, but not always.  Full service in general is higher because generally speaking the product is higher in quality.  For example, I've got a buddy that is executive chef at one of the big steak houses here in town.  Their percentage is around 39%.  High right?  It is, but dadgum they are clearing over $20.00 on average per steak, not counting the sides on the plate.  The higher the average ticket generally the higher the food cost.  As I sit here right now I cant tell you exactly what my food cost is.  I could take a pretty good stab at it, but what I do know is its high!  Now in two weeks I'll be able to tell you within the hour what % cost I am running for that particular day........all thanks to technology.  That is why I just dropped a whole bunch of money on a Point of Sale system.  I opened up operating with a cash register which gives you no real way to manage things.  That was a mistake, a big mistake.  Dave Story is going to guest blog about this in a few days so I wont go into it much more here.  The point is you have to manage that percentage really well.  Theft, waste, inventory mis-management, not paying attention to portion control (which is what I think my largest problem is) are all things that will "F" it all up.  By the way, your food cost does not include your paper goods such as napkins etc..  Thats another blog for another time.  We've done really well here at this location, but I would hate to see how much more money I'd have in my pocket if I had managed my food costs back then like I am starting to do now.  Dont make the same mistake I did.

Tonight I went down to see my buddies at Eastland Cafe to shoot the bull and grab a couple of their UNREAL pizzas to take home to the family. Hal Holden-Bache and Nathan Wells run the kitchen over there for Chef/Restauranteur Willy Thomas. While I was there I was back in the kitchen shooting the bull with Nathan and Hal and thought we might do a small audio blog. So here it is.

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Tornado Victims

Catered an event at Stogie's in Cool Springs last night for the victims of last weeks deadly Tornadoes. They raised a fair amount of change last night for the victims........it was a great thing.




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Changes

For the past month or two I've been trying to get a handle on my two biggest costs; Labor & Food. Not knowing or thinking that I would need anything different, I started my restaurant with just a simple cash register. You have no real way of managing your food costs. I am going to blog about this later, but if you ever do something like this, spend the money on a good Point of Sale system. I just pulled the trigger on an Aloha P.O.S. system. It will be a few weeks before we are using it because of programming in the menu, pricing, portions etc.. But I am hoping to save myself some real money over time by using this. Again, this will be in another blog in the next few days/weeks.
I have also trimmed my labor back. Gonzalo is now gone. Bo and I are going to rotate in and out on the line with Chocho. I hired a new guy yesterday named Alfredo who is going to work part time 35 hours a week. He is going to work 4:30 to close and all day Saturdays. Chocho is leaving on May 1st. When he leaves I will hire another guy to work the same hours as Alfredo to close nights. That should save me $600.00 a week in labor. I'll post on the benefits of a POS system in the next few days. I might even have a guest blogger on the subject, if I can talk him into it.

The week

By now you might have listened to the new audio blog in the previous post. It was just a trial run and has no content, just wanted to see what it was like. Its a cool new feature that Mike Causey has turned me on to. I will only audio blog only a couple of times a week for general content. The business blogs concerning my experiences opening a BBQ restaurant will still be in type form. I'm looking forward to the audio blog, it enables me to blog on the fly. In the next few weeks we're going start adding some video content as well.
This past week ended up being a really good week. Again, sales are all over the place and have no rhyme or reason to them. Wednesday night was a very, very slow day. I started to anticipate us having a really bad week. Thursday picked up, Friday was o.k., and then Saturday hit. Saturday, thanks to a couple of small catering orders that added about $500.00 to the day, we set a new record day in sales. To set both gross sales records in the month of February, which is the absolute slowest month in the restaurant industry, is a very encouraging sign for the year to come. I am going to revisit extending the porch on the front of the Joint to make it a deck for this spring. I'll submit an application for that this week with the city. The picture is of singer/songwriter Kaci Allen. She played a few weeks ago.

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Biz Blog#1-A: Inflationary Pricing

My last post was about location and what you need to make per square foot (as a general rule of thumb) to succeed. Towards the end I discussed my own place and how I need to capture more money per order this calender year to sustain and hopefully increase my 2007 price per square foot level. To increase it I plan on going after off-premise sales pretty hard, which should add about 30% give or take. But to just sustain it I will have to increase some menu pricing to reflect my suppliers price increases on to the consumer. I have added an article below that came out a month or so ago in the New York Times discussing the surge in prices, which is affecting all of us as consumers and business owners. Its affecting you at the pump, the restaurant, etc. Some things you notice immediately such as rising fuel prices. Some are more subtle, such as a restaurant like mine raising some of the menu prices. Some restaurants wont raise their prices right away, especially those that lie in the "Full service" category. They will make other little subtle changes. Remember that free bread they used to bring to the table, notice you have to ask for it now? Wheat is up 270%+ this year....a year ago bread was so cheap they could afford to give you some for free, now its relatively expensive.....why give you free bread if they dont have to? Remember all that butter that used to lay next to the salt & pepper shakers? Where is that now? Milk has also seen a HUGE % increase and is expected to rise another 40% in the coming months, milk based products are included in that figure. Why would they leave a pile of cube butters on the table for you dump 4 of them on your baked potato to stuff your head-hole with? How about creamer for your coffee? Why would they leave creamer on the table for you now.........so you can dump 5 of them in your venti coffee? Not to mention the parents of that little bastard kid at the table next to you whose opening the creamers up and drinking them straight, or that good ol' sweet "christian" grandma who never leaves the restaurant without stuffing her purse full of your complimentary creamers. Thieving wench.
Why this is happening is another blog that I dont have time to explain, but a lot of it is due to the high demand for ethanol. You'll notice these things now and if you are going to open a place up you cant just sit idle and pay attention to whats going on in the world markets. They affect you directly, and if you are not paying attention they will sting your ass. If you dont your sales per square foot will start dropping, and the next thing you know you'll be in trouble. Read the Wall Street Journal and/or Business Day in the New York Times. Every weekend pick up a copy of Barron's and read it. Keep up with whats going on......you'll be glad you did........trust me.

Check this article out........

http://www.nytimes.com/2008/01/15/business/worldbusiness/15commodities.html?_r=1&scp=1&sq=commodities%27+relentless+surge&st=nyt&oref=slogin

Biz Blog #1: Your Location

Dude I'm not really concerned about your location. The old marketing adage "location, location, location" is true dont get me wrong, but I think its like everything else......its all relative. Assuming we are talking about somewhere within a reasonable distance of the masses, whether that be a city of 1,000,000+ or a town of 10,000. To me it all depends on what you are serving, what genre of food your place is. I think that most restaurant genres fall directly under that old marketing rule, but I believe that a few do not. I also would like to mention that those "few" are indicative of the area of the country you are in. Here in the South If there are two types of food that people will drive way out of their way for its BBQ and Cajun food. I have a conservative estimate that (marketing info) 35% of my customers drive from Nashville to eat at my place. Thats a 1 hour round trip in the car for BBQ. That is very flattering to me but it goes to show that in this day and time, with all the choices consumers have, they want value and quality in the money they spend. In other areas of the country it may be a great Pizza place, a burger joint, whatever. If your food is extremely good, they will find you. There might be some that disagree with me on this, and I may be wrong......but I doubt it. If you are reading this thinking about opening up a BBQ joint, and you live in say Hartford, CT then your location MUST be very important, has to be! But if you are in say, Columbus, MS it is not. In Columbus, MS you can afford to lie on the outskirts of town or even farther than that and be successful.......if your BBQ is really and truly great! This is not to say that there are not some exceptions to the rule. As we all know nothing is a guarantee, there are a few places that had good food but for whatever reason just did not make it. Maybe the service was bad, Parking sucked........there are all kinds of reasons but thats for another post on down the road. Right now I'm talking in very general terms. When shopping for a location you do have to weigh them against each other. In Macroeconomics one of the first terms a student will learn is "Opportunity Cost". What does it cost me to choose to do business at location A instead of Location B? Considering all the demographic figures, traffic counts, sales tax returns from other restaurants in the area you are considering and all that other crap.....if location A should yield $17,000.00 a week in gross sales and location B should yield $10,000.00 per week, then your opportunity cost is $7,000.00 per week. In other words its costing you a potential $7,000.00 a week to choose B over A. That doesnt mean option B is not a better choice though.......lease rates, certain clientel, all weigh in on it.
Try if you can to NOT open a BBQ joint in a strip mall. You limit yourself so much in terms of creating an atmosphere. If you must then at least get one of the "book-end" locations so you have options for a patio or deck. If you can find a stand alone building you are far better off!!! If you are buying the location then your annual sales to start-up costs should be 1 to 1. If you are leasing then it should be 1.5 to 1. To help you decided on the space you should consider this rule of thumb for profitability (limited service restaurants......full service would obviously be higher I would think, but my place is a limited service so that is all I can comment on):

1) $200.00 or less you are losing money like an open siv
2) $200.00 to $300.00 and you are breaking even
3) $300 to $400 means you are making a moderate profit
4) $400.00+ means you are flat out skinnin' it back!

Last year my place did $380.00 per square foot. We have a lot of room to grow. We do very, very little catering/off premise sales, which should add 30-40% to that square footage number. Also, my menu prices are very low compared to my competition. Add to that what has happened over the past year with commodity prices and I have lost potential income. I have not reflected those price increases on my menu yet and it is really hurting me. I plan to change that in the next few weeks. Commodities have really hurt some restaurants. Especially anything made with milk (cheese, slaw mix, potato salad, etc.), certain vegtables like potatos, or beef product (brisket). I will never structure my menu prices to be on the higher side of the scale, because I want to provide my customers a premium product at a real value to them, especially the folks of Nolensville! But to be profitable you have to reflect inflationary price increases on to your consumer. So to keep up with my square foot average last year I will have to do that. To grow it past he $400.00 per square foot mark we'll have to grow our catering.

Still shots

A few months back Channel 4 did a little spot on us for their newscast. A few weeks ago I received some still shots from that telecast.

Sales.....

February is notoriously the weakest month in the restaurant business. I dont care what category your food is under, February sucks! I say that to say that last week ended up being really strong and consistent. All winter has been a lot better than I expected. This week however, is looking rough. Snow hit yesterday morning and we all know what that means as southerners. Business was as slow as its been in well over a year yesterday. Its sunny and 54 today (supposed to be) so I'm looking for and/or hoping for a bounce. We'll see what happens. I'm supposed to be headed to Austin this coming Wednesday for the NBBQA convention but now have to figure out how to squeeze in Louisville also. Dont know how yet I'm going to do that but we'll see.

Action Shots.......

A few action shots of the kitchen on a Saturday night. Bo at the register. Our most requested/sought after side item: the hand-cut fries. Ernesto bringing in more potatos to be cut for fries.

Memphis in May meeting

Well its that time of year again. Yesterday we had the first meeting of 2008 for this years Memphis in May. It was a great time and dang good to see some of the guys on the team. As you know I'm not really into the competition thing..........nothing at all wrong with it I just dont really have the time to do it. But this is a lot of good clean fun, and I'm really looking forward to it. I brought some "prospects" to the meeting that I'm hoping will join. Lamb, Michael, Nathan Wells (sous chef from Eastland Cafe), Jason McConnel (chef/owner Red Pony & Sol in Franklin) and Dave Story (Jim-n-Nick's).............Yazoo is coming on board to sponsor and supply beer. We eat better than any team down there and this year should be no different.

The Business of it all........

All right.......I get emails all the time from folks all over the lower 48......literally. I'm talking about in areas of the country that you (a southerner) wouldnt dream of caring about BBQ. They (emails) have progressively gotten more and more frequent. I really like answering them and being of any help when I can. Its people in the same shoes I was a couple of years ago just looking for simple answers.
When I first started this blog almost two years ago I didnt know a dadgum thing about running and/or managing a restaurant. I mean nothing. I invited my buddies to come along for the ride to either watch it succeed or watch me financially set my life back to the stone age. I had no idea that anyone other than friends would care to read about what was going on. That being said I quickly discovered another reason that pushed me to keep it going. When I started it I really could not find any information "out there" as to how to do it. Oh there are a butt-load of "how to start your own restaurant" books out there, but most of them are useless. I wanted to talk to somebody who did it. I wanted to find out what worked and what didnt. I had so many questions that I could not get or find answers to. It was tough knowing where to go and/or who to talk to. So I figured I would document my own experiences to maybe help somebody else out someday looking to do the same thing.....whether I made it or not, and I can tell you that I am far from being out of the woods!
So one thing I am going to start doing is mixing in some posts about what I've learned about the actual business side of things....numbers, percentages, etc.. Using this info can save someone a lot of wasted money and misery. I only plan to discuss what I have experienced. For example, I dont sell liquor.......the "devils nectar" as we call it in the Church of Christ......so I cant really blog about that. Beer on the other hand........we sell over 20 different kinds so I have insight as to what mark-up works for me, what sells, etc.. In case that last statement sounds like an oxymoron to you let me just say that yes it is and at the same time no it isn't.....but thats for another blog somewhere else. My goal is for the info on this blog to be useful and helpful to someone. Does that sound "cheesy" to you? Well if it does go crank your car, wrap your lips around the tail pipe and breath in for a while........let me know how that works out for you.

Wings.

Some of our smoked wings.

Sick.

Well today is the first day of work I've missed since being open due to illness. I really cant even muster the strenght to type this post...........I'm so weak right now that I could'nt pull a greased string out of a sick cats ass. I dont know what I've got. The last time I missed work because I was sick was about 10 years ago working for Dain Rauscher in Memphis when I was selling bonds. I got home yesterday afternoon and "it" hit like me a like a truck. About 9:00 the throwing up started and didnt end till early this morning. Been in bed all day. Hope to get back to it tomorrow Lord willing.

Random post.

This is about hour #16-18 or so in the process of cooking a Hog. The fat starts to liquidate and pool up in the rib cavity, in effect poaching the ribs and loin.......which is some of the most decadent meat you have ever put in your mouth! For a 185-200lb Hog cooking at 185*, you've still got another 6 or so hours, give or take a little. Once it goes to drippin' through the skin on to the coals back by the spine, you know your getting pretty close to being done. You can start shutting your chimney down cause you wont need many more coals.

Record Day

Its amazing what a little sunshine and 60 degree weather will do for you. Yesterday we had the best one day of gross sales ever......in February! It was steady all day and then we got slapped last night. It really helped our week because Tuesday & Wednesday were a little slow. I included a picture of my little girl Daisy smiling about the news. In the following weeks I am going to start blogging a lot on the business side of the restaurant business. Rules of thumb, calculations, and all kinds of wonderful stuff I've learned the hard way over the past year and a half. Hopefully, if you are thinking of doing something asinine......like opening up your own bbq joint or restaurant......this info will save you some time and money!

Marketing......what works and doesnt work (for me at least).

Well after playing the role of the "new restauranteur"........a.k.a. "ignorant sucker" for the past year and a half, I think I've found some marketing that actually works. When you open up every Tom, Dick & Hare comes by selling you on every marketing/advertising scheme known to mankind. You've got a certain amount set aside in your budget for it, and most of them make it tough for you to make a decision. The truth is most of it, in theory, sounds like a home-run. Now I'm not going to set here and speak as if I am now the authority on what works and what doesnt.............but I will tell you what worked for me, which was not much. I've done coupons on the back of Kroger receipts, Newspaper advertising, Sudden Values, coupon magazines.............all of which have been about as worthless as tits on a boar hog. BUT.........my radio campaign on 104.5 the zone (local sports/Titans radio show) added to the bottom line......and I just did a direct mail campaign for several local zip codes that looks to be working very well. We are consistently getting probably on average of 10+ per day coming in the Joint and I would say that 75% of them are new customers. I am going to start an email list here in the next month or so.....which is what Sudden Values is/was but I dont think they really ever sent anything out. I am pretty happy with the direct mail campaign.....we'll see how it goes over the next few weeks before I'm completely sold.

Free Sauce & T-shirts

Hey if you have a minute go check out www.homeofbbq.com.........you could win some free sauce, a free shirt or maybe both!