Hello Friends,
A year ago I made this post: From o to 6 Figures (What few people will tell you)
Well in December 2023 an opportunity came up to take on the lease for a physical food business in my local area, and I though f$£% it.
Here's the lesson's I've learnt in the past 9 months which hopefully will help someone here.
The Business
This is a static mobile hut (which I'll refer to as a burger bar) based in the car park of a builder's merchants in my local area, it has 10 year's history but recently had a bad reputation for poor service and hit and miss opening times.
Figures
The business (on paper) was making around £4,500 a month when I took over, we now make £7,000 a month (hence the 55% increase in 9 months)
My Background
I am 38 (today.. woohoo!) and have 2 other businesses. I don't have an MBA, and have no experience in the food industry.
The Lessons
The best opportunities are rarely advertised. Alot of people ask me how I found the business. Basically I had eaten at the burger bar on and off through 2023. It was cheap and convenient. In August, it shut unexpectedly, and then a guy re-opened it in September. I had a chat with him and found out he was the owner. Over the next few months I got to know him better, and learnt more about his personal life. He had a young family in another country and wanted to keep the business, but couldn't run it. When I first asked if he would consider leasing it, he said no. But in December he had a personal family emergency and called me, saying he was willing to do a deal. The paperwork was agreed and signed in 6 days.
Location is everything. I always noticed the burger bar had great foot traffic. In a builder's merchants so people come by all the time. Also it's close to a local train station, bus station and high street. So the foot fall is great. Yes, I'm sure people will argue that you can set up a business anywhere online. But that's going to be slow going. Online food delivery is bloated and it takes time to get noticed online.
Do your homework. I've had an office in the local area on and off for 3 years and I noticed it's hard to get consistent and cheap lunch service. Apart from your big box McDonalds, the local area had lots of small cafe's which were very slow, or overpriced and poor quality. I made a point over this time to eat in lots of different places and experience this as a customer.
Have consistent opening times. The first 6 months after we opened, we had lots of customers come down, saying they had stopped coming simply because the previous owners would open and shut whenever they liked. They treated it like a life style business, not an actual business. Our standard customer is a hungry builder who doesn't have time to make lunch and want something tasty, failing quick and relatively inexpensive. If they like it, they'll come back again and again
Know your target market. We are not the Ritz, we serve sandwiches, burgers and hot food to busy builders. Which means we keep our prices reasonable, serve good quality food, and decent sized portions. This means we get alot of repeat customers. Our audience is price sensitive but more than that they are time and food sensitive. Meaning if you give them a tiny sandwich with nothing in, you will never see them again. But if they have to travel and wait, but know they will get something tasty and filling, they will do so happily.
Service really is everything. As I run other businesses I didn't have the time to come and work at the burger bar myself (though I'm happy to cover, clean and be a general gopher) , I asked a friend of mine if she would run it for me and she jumped at the chance. She works short hours, gets paid well and is back in time to pick up her kids from school. My audience get's a lovely looking woman behind the jump, who remembers their name, is happy to banter and cooks a mean burger.
Know your numbers. This is true in any business. But very true for food. Because you have consumables which go off quickly. If you know your margins and also your approximate stock, you can bulk buy effectively from wholesalers and make huge savings.
Limit your menu. Our menu is straight forward, and limited. It actually looks quite large, but we are essentially using the same ingredients in a different way (for example you could offer seven different types of burgers, but they also basically use the same ingredients, plus some sort of sauce or garnish) This also means you're not tied up with lots of stock, or taking up alot of space if you don't have much
Ask the customer what they want. In the first 3 months I was always asking customers what else they wanted. We added a frier for chips and onion rings, and added speciality burgers and sandwiches (like a 1lb burger) , and chances are if 1 person wanted it , so did other people. Everytime I add something new , or change something we always ask customers if they like. For example recently we started using brioche buns. People loved them with burgers, but hated them with sandwiches, as they don't like the sweetness
Be prepared to learn and get dirty. The first 6 months were f^%$ing hard work. I had generators blow up, electrics melt, rats, food inspections fail. Doors fall off. I had to quickly become a handy man, and also learn about general building and maintenance (because it eats into your profit to hire someone all the time) I'd also assign days when all I did was work on the burger bar. Plus it's always an ongoing job. We open 7 days a week, so something always need fixing
It's not for everyone. It's an ok income, but I'm still on the fence about whether to keep it going. I think if it was my only business, it would be a good earner. But I pay someone to run it for me. In some ways it's great because we have daily cash flow, and also all my lunches are free, but sometimes it comes down to what number really excites you. I can probably think of easier ways to earn money, but the lessons and experience I've gained has been priceless
I'm sure someone will say "I'm lucky to have found this place" , but I spent 3 years thinking about a food business.
Also this is my third business, so it truly is driven by entrepreneurial spirit.
Something that often drives me, is less about the money and more about the learning.
One thing I will mention as an owner of numerous revenue streams, is that it did have an affect on other parts of the business.
As an owner you can only do so much, and it is better to focus on one thing.
What I got out of it though is an exceptional manager and partner who I have high hopes for in the future.
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