Well hello everyone. It is I, Robbie, who has missed his connecting train to Riomaggiore. Luckily, we were able to catch a 10:45 pm train. We will be arriving around two hours late, at about 12 am, but we are happy to have caught this train at least.
After spending the past few days in London, I had an experience I thought I would write about. I finally went to the one, the only, Harrods. I had seen Harrods before in a James Cordon skit from The Late Late Show. After vising this exquisite store, I decided to start referring to it as the “labyrinth of luxury”. Good luck finding the bathroom. I must have asked six people where the MEN’S toilet was, and it was located in the most logical place – the women’s lingerie section. Really, Harrods? Really?
Harrods is interesting. I’m not sure how old it is, but I would assume it has some history behind it and it is a great example of creating a shopping experience. You have this feeling of wealth when you are in Harrods; that is, until you purchase something. I pointed out a bathrobe that had a very nice feeling material to my girlfriend, only to find out it was £800! (over $1000) Lets say that you go into Harrods wealthy and walk out poor.
I’m pulling into Riomaggiore finally and will continue this later.
Now I’m writing to you another day on the way from Riomaggiore to Florence
So, where was I? Ahhh, yes. Harrods. The labyrinth of luxury. So I’m often thinking about business and while I was in Harrods, I couldn’t help but think about the differences between what I call the “status symbol restaurateur” and the “restaurant capitalist”.
I have this theory that everyone wants to open a restaurant. Mind you, most people have no idea about owning a restaurant, or how to make money from one, but everyone likes the idea of having a restaurant. You can go to your restaurant and invite your friends for a meal in your very own spot. Everyone in town wants to know you, because, lets face it, owning a great restaurant can be a status symbol.
The reality is, many restaurants don’t make nearly what you think they do. And most restaurants take at least two years to break even. I see a difference between the status symbol restaurateur and the restaurant capitalist business person.
The restaurant capitalist is someone opens up a business, first, because it is a profitable endeavor. They don’t necessarily care what the business is (as long as they understand it’s economics), and they don’t look at it as a status symbol. Is it a coin laundry? Is it a junkyard? Is it a moving company? If the business economics make sense, they are into it.
In order to create a company like Harrods, it would be nearly impossible to do so in a short period of time. Harrods is a brand that comes with class. I mean, I’ve never seen so many Joe Malone perfumes in my life. They must have had 25 different perfumes. Apparently some of them were made just for Harrods.
It takes time to build a brand like Harrods, just like it takes time to build many restaurant brands. Not to mention that a busy restaurant isn’t even necessarily a profitable restaurant. Of course, there are many talented restaurant capitalists. They know their margins, their food costs, the turnover needed, their pricing, location, rent, market segmentation etc….they look at it as a business.
Of course, there are the talented chefs. Those who want to own a restaurant and practice their craft. They are a bit different. Some chefs just want to practice their craft and please their fans. They gain gratification from this, and many of them are not owning their restaurant to have a status symbol, but because they love to create the delicious art of food. There are also chefs who are restaurant capitalists – they know the business side as well as the food side.
You then have the status symbol restaurateur. Those who don’t really know what they are doing and don’t care to do the work needed to understand if their restaurant will be profitable. They have these grand visions of opening day, when all of their friends, their family members, the mayor, are lined up at the door. They just love this idea of this status symbol and it is the main force behind their desire to open the restaurant. They soon figure out how hard the restaurant business is. The gloriousness is soon washed away by the day to day; not to mention your friends keep stopping by, dropping your name, and drinking your wine for free.
The status symbol restaurateur thinks they are going to create a Harrods overnight. The problem is that a status symbol like Harrods takes years or even decades to mold into the brand it is today. Your restaurant isn’t likely going to have a sudden overnight birth of this Harrods type of brand. It may develop into one over time, but you need to give it time.
You should do the proper research before opening your restaurant, and you should ask yourself if there are better opportunities for your money. If the restaurant seems to be the most profitable option you find for your business endeavor, then by all means, open the restaurant.
In closing, ask yourself if your vision of business is creating a status symbol like Harrods or a hot new hot restaurant? Or, is your vision of business making money, no matter what the business is? I’d say to stick with the business that makes money, not with the business that creates a status symbol. If you open your restaurant under the guise of status, you likely won’t be all that successful. If you open your restaurant because there is a need or a strategic advantage in the area, then you are the restaurant capitalist, and I’ll cheers to your success. (hopefully with a glass of champagne at your restaurant on the house)
I’m going to enjoy my train ride now to Florence. I’m craving some gelato!
Thanks for reading.