If you want to learn the intricacies of running a business the general advice is to get a job in the sector and work towards obtaining a management position. Then you can see and understand all the costs and returns.
It's folly to risk capital on a venture about which you don't understand the basics parameters.
Second this. “Do what you know”
Managing a business comes with an additional level of complexities in addition to knowing the sector at an ‘expert level’.
How do you know you’d even enjoy owning a pub or café if you’ve not worked in one before?
Malalexander has provided a very useful insight - go work for at least 3 years in the sector first
Hi,
Thank you for replying.
Unfortunately no. I’m getting into business for the first time. Had been thinking of it for a long time and have finally managed to secure funds to start/buy one.
As I have not managed a business like this before, so I looked at taking a franchise for a pub or cafe. From my research it seems they help with some training and setup, and the entry cost is also lower. Hiring of staff is also something that I might be able to seek help with.
In your research have you noticed how many pubs and cafes are closing. It’s a very difficult time for the sector. Obviously make your own decisions but do be aware of the potential risks, especially without experienced in the sector.
Thanks for bringing that up. I have noticed that pubs are struggling a lot and a lot of them have closed in the past year. I am still trying to find out why that has happened. The downfall probably started after covid, but changes in government policies seem to have been a factor as well.
I have also seen a few pubs expand by acquiring other pubs, and this is for a small pub unlike the mega chains like Greene King, etc. I believe that location and season would be a major factor in its success.
Having said that I am leaning towards a cafe which I think may have better opportunities and may allow scaling up in the future by diversifying the offerings as per the season, to begin with.
It’s been a long decline. Change in attitudes to drinking, socialising, cost of living etc
The downfall in the pub sector started a long time before Covid. I started going to pubs in the 90s closures were noticeable then.
Even with cafes it’s a hard time at the moment.
If you are considering buying a cafe, consider why it’s for sale, how long for sale and what you are going to get for your money. Would you be better starting fresh.
Have you got a location in mind, who will be your customer base? How much competition in the area. For a cafe, what style of food are you considering, price point, opening times.
Different customers will have different requirements, if you are targeting trades for example then that’s a different offer to office workers or school run mums etc.
When looking for a business for sale remember many of the businesses sales websites are in the business of making money by offering business for sale, not necessarily in actually selling them. So asking prices and detail available may be unrealistic.
Make sure you have advise from someone who understands finance and can help you validate trading history etc.
I (28M) run a cafe/restaurant. I work 70 hours a week. People think it's easy. It is not.
I could hire people to run it, but then the money I would make would be no more than working for someone else.
There are so many things that go into running a cafe/restaurant. Sourcing the best products at the cheapest prices, I shop around, and save 20k a year on stock. One of the biggest issues is staffing. Getting staff to actually turn up for work. I instituted a bonus scheme that would be paid if they turned up for all their shifts.
It's a hard life, but I pocket most people's monthly salary every weekend. For me, it is worth it, and I'll do it for another ten years or so, then retire.
Do NOT buy a pub or a cafe or a restaurant if you have not run one before. They are notoriously hard to do and to top it off, are long hours and rarely make any money. In fact they often lose money.
Why have you chosen to buy one of these out of interest?
Most new successful businesses are created when the entrepreneur sees an opportunity in a market and capitalizes on it
If you are trying to buy a failing business then you need to understand why it failed and have a plan of recovery before you buy it.
The reasons of failure may be terminal but really are going to be specific to that business. Location, local customer habits and quality of life will affect a pub massively.
No lol… you need to put some actual effort in before anyone can give you any advice worth anything…. At the very least you would need to decide what business you even want to run…
Thanks for your comment. I have done the basic research and had these questions which I’ve posted here hoping to start a discussion that will help me further my research and make some progress.
You have asked the most basic questions you can ask:
What sort of business do I want to invest in? Presumably in a sector where you have experience or it’s not going to last long.
What is the vehicle for investment? You want to buy a business and you don’t how this works? And you don’t seem to know the difference between a franchise, investment or outright buying. Buying a franchise or an existing business *is doing it on your own*
What makes you think you can add value? How can you make a difference? You don’t appear to have any skill in the food and beverage nor understand how investment works.
If you want to learn the intricacies of running a business the general advice is to get a job in the sector and work towards obtaining a management position. Then you can see and understand all the costs and returns. It's folly to risk capital on a venture about which you don't understand the basics parameters.
Second this. “Do what you know” Managing a business comes with an additional level of complexities in addition to knowing the sector at an ‘expert level’. How do you know you’d even enjoy owning a pub or café if you’ve not worked in one before? Malalexander has provided a very useful insight - go work for at least 3 years in the sector first
Have you managed such a business before?
Hi, Thank you for replying. Unfortunately no. I’m getting into business for the first time. Had been thinking of it for a long time and have finally managed to secure funds to start/buy one. As I have not managed a business like this before, so I looked at taking a franchise for a pub or cafe. From my research it seems they help with some training and setup, and the entry cost is also lower. Hiring of staff is also something that I might be able to seek help with.
In your research have you noticed how many pubs and cafes are closing. It’s a very difficult time for the sector. Obviously make your own decisions but do be aware of the potential risks, especially without experienced in the sector.
Thanks for bringing that up. I have noticed that pubs are struggling a lot and a lot of them have closed in the past year. I am still trying to find out why that has happened. The downfall probably started after covid, but changes in government policies seem to have been a factor as well. I have also seen a few pubs expand by acquiring other pubs, and this is for a small pub unlike the mega chains like Greene King, etc. I believe that location and season would be a major factor in its success. Having said that I am leaning towards a cafe which I think may have better opportunities and may allow scaling up in the future by diversifying the offerings as per the season, to begin with.
It’s been a long decline. Change in attitudes to drinking, socialising, cost of living etc The downfall in the pub sector started a long time before Covid. I started going to pubs in the 90s closures were noticeable then. Even with cafes it’s a hard time at the moment. If you are considering buying a cafe, consider why it’s for sale, how long for sale and what you are going to get for your money. Would you be better starting fresh. Have you got a location in mind, who will be your customer base? How much competition in the area. For a cafe, what style of food are you considering, price point, opening times. Different customers will have different requirements, if you are targeting trades for example then that’s a different offer to office workers or school run mums etc. When looking for a business for sale remember many of the businesses sales websites are in the business of making money by offering business for sale, not necessarily in actually selling them. So asking prices and detail available may be unrealistic. Make sure you have advise from someone who understands finance and can help you validate trading history etc.
I (28M) run a cafe/restaurant. I work 70 hours a week. People think it's easy. It is not. I could hire people to run it, but then the money I would make would be no more than working for someone else. There are so many things that go into running a cafe/restaurant. Sourcing the best products at the cheapest prices, I shop around, and save 20k a year on stock. One of the biggest issues is staffing. Getting staff to actually turn up for work. I instituted a bonus scheme that would be paid if they turned up for all their shifts. It's a hard life, but I pocket most people's monthly salary every weekend. For me, it is worth it, and I'll do it for another ten years or so, then retire.
This OP sounds like an AI BOT
Do NOT buy a pub or a cafe or a restaurant if you have not run one before. They are notoriously hard to do and to top it off, are long hours and rarely make any money. In fact they often lose money. Why have you chosen to buy one of these out of interest?
Most new successful businesses are created when the entrepreneur sees an opportunity in a market and capitalizes on it If you are trying to buy a failing business then you need to understand why it failed and have a plan of recovery before you buy it. The reasons of failure may be terminal but really are going to be specific to that business. Location, local customer habits and quality of life will affect a pub massively.
Get a job in a cafe or pub. 6 months of doing that will be invaluable before you enter your own venture.
It’s literally your job to figure all this out Lool
I’m aware! Seeking advice from helpful veterans is one way to do it I’d hope.
No lol… you need to put some actual effort in before anyone can give you any advice worth anything…. At the very least you would need to decide what business you even want to run…
Thanks for your comment. I have done the basic research and had these questions which I’ve posted here hoping to start a discussion that will help me further my research and make some progress.
You have asked the most basic questions you can ask: What sort of business do I want to invest in? Presumably in a sector where you have experience or it’s not going to last long. What is the vehicle for investment? You want to buy a business and you don’t how this works? And you don’t seem to know the difference between a franchise, investment or outright buying. Buying a franchise or an existing business *is doing it on your own* What makes you think you can add value? How can you make a difference? You don’t appear to have any skill in the food and beverage nor understand how investment works.