The Financial Reality of Restaurant Ownership

COVID-19 was the last straw that finally exposed a broken business model

24 min readJan 21, 2021

2020 brought new awareness of restaurant industry challenges into the forefront. While those in the industry have always known this harsh reality, discussions in 2020 about profit margins (under 10%), delivery commissions (up to 30%), and labor cost models (to tip or service charge?) became trendy topics for those wanting to support their favorite eateries.

With increased public awareness of the brutal math of restaurants, I feel it’s even more important to show what challenges restaurants face under “normal” circumstances.

We cannot contemplate the future of restaurants without understanding the struggles they faced pre-COVID.

You don’t need to just take my word on how hard it is to make money owning a restaurant: I am going to provide real, hard numbers. I will share and walk through our restaurant’s 2019 Profit and Loss Statement (P&L), breaking down each line and how I, as an owner, interpret it.

Upfront caveat: this is my own personal experience and no one else’s. I am not claiming my reality or opinions match anyone else’s, and what works for me is not the same as any other restaurant or business owner. YMMV.

I will do my best to put these numbers into industry context, but again, everyone’s reality is different based on their business, cuisine, location, taxes, expenses, wage costs, customers, and many other factors.

Why am I sharing this? Several reasons:

Frustration — When you become a restaurant owner suddenly everyone has “suggestions” for you. While I appreciate the helpful intention, I get tired of explaining all the reasons why they don’t work.
Solidarity — Our industry peers already know these challenges, but by publishing this publicly I hope it raises awareness of just how damn hard it is to run a restaurant and why for many people in this industry it’s more a labor of love than financial success.
Understanding — Every time someone no-shows to a reservation or leaves a mean-spirited 1-star Yelp review for something ridiculous or out of our control, it makes running our business that much harder. If just a few people read this and change their behavior just a bit, it makes things better for all of us.
Education — At the end I’ll share a few very simple things you can do to help your favorite restaurant survive and thrive.

Please note: to share this level of detail is scary. We are sharing with the world how much we make and how we spend our money. We appreciate your compassion and empathy.

Restaurant Models, Profits & Ranges

At this point, it’s trope to state that restaurants only average a 10% profit margin. This is actually a misleading statistic. For one thing, restaurants have a wide range of business models, from “full service” (sit down, order with your server, eat, pay) to “limited service” (Panera) to “quick service” (McDonalds). With a wide range of business models are wide ranges of profits. For this article, I will be focusing on our model as a full-service restaurant (although in 2020 we had to up our takeout game to survive).

In addition, all statistics about businesses are skewed by survivorship bias (basically, the restaurants that close are not reported, leaving you only the ones that are still operating to report statistics). This skews numbers higher, as the restaurants that are losing money (negative profit) end up closing and disappearing.

Even with those caveats, this 2018 report on full-service profit margins is scary:

Average Net Profit Margin for Restaurants 2014–2018 (Source: Forbes.com)

Between 2014 and 2018, the average (surviving) restaurant profit margin varied between 1.8% and 6.1%.

Notice that’s even lower than the misquoted 10% margin! When restaurants say they barely survive in the best of times, this is what they mean.

Also not well understood is when people discuss profit margins they generally mean operating net margin (i.e. — the amount of profit the business generates from its operations). But this is not how much money the owner(s) take home, because you also have to factor in the financing costs of opening and running the restaurant (more on this later).

That’s a long way of me saying that 10% grossly overstates how much money restaurants make.

To really understand how restaurants make (or lose) money, it’s necessary to break apart the cost structure of a restaurant and put each piece in context. Some parts are controllable (like labor), others are not (like rent). Even controllable costs are really only semi-controllable (there is a minimum number of staff you need each day to operate, and a maximum number you can physically fit in your space). To help make this tangible, I am sharing our 2019 Profit and Loss (P&L) Statement. This is our actual P&L — nothing has been removed. I only combined some categories to protect the privacy of our team members or simplify similar items.

If you’ve never reviewed a P&L before, keep in mind like other technical documents, they have their own language and meaning. Terms may have different meanings than their common usage.

A few disclaimers:

This P&L is unaudited and does not include year-end tax adjustments.
Because we purchased the restaurant on May 30, 2019 this statement only covers 214 days of operation, or 58.6% of a full year. For this article, however, that should be fine as the cost and revenue percentages apply equally throughout the year.
We run on a 13 4-week period accounting calendar (instead of monthly periods). This is common in the industry because it provides clean comparisons week/week, period/period, and year/year (assuming you track sales and costs every week, which we do). As a result, our fiscal year ended on December 29, 2019.
I’ve also included our GL (General Ledger) codes for those that are curious.

At various points I have added small “side notes”. These are points of interest about common misconceptions of the restaurant industry.

Ready? Let’s begin…

Sales

Self-explanatory. This is the only fun part of the statement, as it shows how much money is coming in.

We break out food and bar sales separately. NA Beverages is Non-Alcoholic beverages and is categorized under food because the cost structure of alcohol sales needs to be broken out separately. Put another way, we could still sell NA Beverages without a liquor license or bartenders, so you want to exclude these sales from all alcohol-related costs.

We further break out food into 2 groups: Sushi and Food. One interesting reality of sushi restaurants is we have 2 “kitchens”: The “hot” kitchen and the sushi bar. This adds labor (since sushi requires highly-skilled staff with years of training) and facility costs (different ingredients, equipment, etc.) Breaking out sales this way helps us understand our sales and costs better across different types of cuisine.

Our bar sales break out Beer, Wine, Sake, and Liquor. We have an 80%/20% mix on food versus alcohol sales. This is neither good nor bad, it just is. We do look for ways to increase our bar sales since the labor costs for alcohol are much lower than food.

Side note: It’s not necessarily a positive to keep increasing alcohol sales. Many states have different liquor licenses depending on what % of sales comes from alcohol — the higher the %, the higher the cost and additional regulations may kick in. Also, we pay higher insurance rates the higher this % goes.

You’ll note the sales section is very short. Like having dessert before dinner, it’s over too quickly and now we’re left with a lot of vegetables to get through. Math geeks will extrapolate our annual revenue as approximately $1.3M/year.

Costs

From this point everything is money going out the door instead of in. While understanding the details of your expenses is critical, also knowing your business’ general cost structure is key to knowing where to focus and where to not waste your time. For restaurants, the biggest expenses tend to be labor, rent, and food (input costs). If you’re looking to cut costs you focus on those 3 first. If you manage those 3 as tightly as possible and still struggle to make a profit, then you have a sales problem.

Our business has a higher than industry average labor cost because a) we are in Seattle with a high minimum wage and b) sushi is a very labor-intensive cuisine that requires highly skilled people to do it well. As a result, our labor costs will seem high to other restaurant owners but our food costs may seem low. Other restaurants might have different cost ratios for labor or food depending on their circumstances.

Let’s dive into costs:

Food and Pour Costs (Input Costs)

First up are our food costs (more generally known as COS or COGS ((Cost of (Goods &) Sales). These categories are self-explanatory: This is the cost of ingredients that go into our menu.

All these percentages are based off of Food + Sushi sales, with the exception of NA Beverages, which is just based off of NA Bev sales. The specifics aren’t as important as our overall Food costs, which average 25%.

Similarly are pour costs. Beer is our cost for beer, wine for wine, etc. These are all directly tied to their corresponding sales GL, with the exception of Bar Consumables, which are based on liquor sales. Bar Consumables are what it sounds like, things like garnishes, straws, and other ingredients that are used in making cocktails.

Total Pour cost represents our gross margins for alcohol all-up. A 22% pour cost is a bit high but that’s driven partly by the high cost of sake (we can’t charge the same markup on sake as we can for beer/wine, people won’t pay that much).

Altogether our COS is 24%. Against the industry average this is pretty low, but that’s because our labor costs are MUCH higher than the industry average (which we’re about to see). In Washington state the industry average food cost is closer to 30%.

Labor

This is by far the biggest expense we have, and one that is only partly controllable. We run a pretty tight ship, but we also believe in paying fair wages above and beyond the minimum wage whenever feasible.

Discussions of minimum wage can get heated but to put things in context the minimum wage rates in Seattle are MUCH higher than federal (2020 minimums):

Tipped minimum wage is $13.50/hour
Non-tipped minimum wage is $15.75/hour

This can lead to a charged discussion about tipping. I’ve published an earlier article explaining the challenges of going tipless in restaurants in the US. For this article, the key point is our servers/bartenders work for minimum wage but earn much more through tips. We have a very strong team culture where our Front-Of-House (FOH) crew voluntarily “tip back” at least 1/3 of their tips each night to our kitchen and sushi teams, which helps everyone earn better wages.

Side Note: In mid-2020 due to COVID we were forced to switch to a tip pool instead of a voluntary tip back system to ensure fairness in the chaos of COVID-related operation changes.

Our team is too small to properly anonymize individual pay. To respect the privacy of our team members, I have combined our labor cost categories together. Dollar amounts represent gross wages earned (before taxes), but NOT tips (which never appear on a P&L).

For our Back-Of-House (BOH) team, we break out labor costs for sushi and kitchen.

The % calculation is based on Food sales ONLY (excluding N/A Beverages). This is to properly allocate the expense of making the food with the sales they relate to (e.g. — kitchen and sushi crews are not involved in bar sales).

For our FOH team, their % are based on all sales (since they are involved in both food and bar sales). This is why it looks like the “cost” of your FOH team is so much lower, their expense ratio is based on Food and Bar sales, not just Food. That said, everyone is critical to our overall success.

The key metric we look at is the “Total Operational Payroll”, which is basically how much we paid in wages as a % of our sales. (You always look at things as a % of sales. This gives you a more solid idea of what your cost structure is over raw dollars, since, in theory, we can increase/decrease our staffing to match the number of customers we have (within limits)).

Our goal is to keep this at 30% or less, but that’s extremely difficult for us with the cost of labor in our area. If I can keep it under 35% I’m happy. Many restaurant owners in other parts of the country would be aghast at a labor cost this high, but then again some are still paying their servers the federal tipped minimum wage, which is still only $2.13/hour (unchanged since 1991)! Compare that to our $13.50/hour, and you can see how much higher our team is paid.

Next is “Other Payroll”, which is wages we’ve paid for things other than hours worked. This can include paid sick leave (required in Seattle), and other wages paid (bonuses, PTO, etc.).

Finally we get into “Payroll Related”, which is where all of the various taxes, deductions, and other employment related costs go. To break these down:

Payroll Tax Expense — This is our (employer) portion of federal Social Security & Medicare taxes.
Unemployment Tax Expense — Our contribution to the state unemployment fund. This is determined by a complicated formula based on hours worked and # of claims filed against us.
Group Insurance (Medical) — Our portion of medical and dental benefits. This is very rare in the industry and we can only afford to offer benefits to a few key people plus ourselves as owners. This does not include the portion our employees pay for their own benefits (they pay 25%, we pay the remaining 75%).
Life Insurance — We have an SBA 7(a) loan and as a condition we are required to have life insurance policies on ourselves as owners.
Employee Discounts — We offer our team discounts on purchasing food

Side Note: This is different than the traditional “staff meal” or “family meal” which is provided to everyone before service.

Combine all this together and we come up with our “Total Labor” cost, which for us is just over 41% of sales. This is very high within the industry (and again does not include tips). Another way of looking at this is 41 cents out of every dollar spent at our restaurant in 2019 went towards our staff.

Our accounting company (Restaurant Accounting Services) focuses exclusively on restaurants. From them we’ve seen comparison data against other WA restaurants showing our BOH labor % is much higher than the average in this state (31% for us versus 19% average in WA), but our overall labor costs are about the same. We attribute that to having zero management positions. We have no General Manager or Assistant GM; we do that role ourselves as owners. As a result we are able to pay a higher wage to our kitchen and sushi teams.

This might lead you to ask “Wait, where is YOUR salary?”. Great question. It’s not here, because while as an owner I do collect a salary it is not part of our operating P&L. Since we could choose to pay ourselves anything we could manipulate our salaries to make our profits look better or worse. If we hired a GM they would appear here, but as owners our labor costs come much later in the P&L.

Gross Margin

Food and labor costs are the most “controllable” expenses of running a restaurant (also the most variable). In the industry these are referred to as “Prime Costs”. A key metric is Gross Profit after Prime Costs (GPPC), which most businesses call Gross Margin. Several resources suggest a successful restaurant is looking for a GPPC of 35% or higher. At 34.65% we are pretty close, so I call this a success for the year, but we’re nowhere near done.

Fixed and Semi-Variable Costs

We now get into more fixed costs, or expenses for which the cost doesn’t change much month/month but are still critical to operating.

Direct Operating Costs

These are costs directly related to operating the business.

Aprons & Uniforms — Cost of weekly laundry service for clean chef coats and aprons for our crew
Linen & Dry Cleaning — Cost of clean rags, napkins, and other laundry service
First Aid Supplies — Self-explanatory
Decorations — Things such as candles, artwork, painting the walls, etc.
Help Wanted Ads — Cost of job postings. Hiring is NOT cheap, hence why we focus on finding the RIGHT people.
China/Glass/Silverware — Self-explanatory. Stuff breaks, you have to constantly buy replacements. And it’s much more expensive than what you get at Ikea or Target.
Bar, Kitchen, & Restaurant Supplies — Catch-all for supplies we need regularly (trash bags, compost bags, paper towels, sponges, etc.)
Contract Cleaning — Nightly janitorial services, plus other recurring cleaning (windows, grease removal, etc.)
Pest Control — Monthly rodent and insect treatments (we have no issues and prefer keeping it that way)
In-House Entertainment — Cost of our monthly subscription for background music. No, legally you cannot just put on a Spotify stream or run a playlist off a phone.
Printing Expense — Menu and marketing printing
Soaps & Chemicals — Various soaps and cleaning chemicals used in our dishwasher, glasswasher, air scrubber, along with hand soap and (today) hand sanitizer
Paper Products — This is where we record the cost of our to-go supplies (containers, bags, etc.). This has gone much higher in 2020 with COVID-19 forcing takeout only.
Retail Tax/Fees Paid — As a retailer we are exempt from paying sales tax on items that we re-sell, but for other supplies we pay taxes
Contract Labor — For general cases where we’ve hired someone on a one-off basis. This can be anything from a temp person filling in to someone doing a “stage” (French pronunciation for an on-the-job interview– traditionally unpaid but we insist on paying people for their time)
Vehicle Expense — Costs associated with using our personal cars for work. Usually this is when we’ve had to pay parking while running an errand.
Fuel Surcharge — A line item often on vendor invoices to cover their costs
Training & Education — Costs associated with mandatory staff events (safety training, etc.).
Meals — For times we buy food or drinks for our team. Pizza for team meetings, good coffee for the kitchen, etc.

Advertising & Promotions

This section covers costs associated with advertising but also discounts given to customers. Every time you get a free meal, discounted item, or “comped” food or drink, the “cost” of that free item is recorded here, because you’re getting something for free that should have been paid for.

3rd Party Delivery Fees — I’ve combined the fees associated with several different delivery providers into a single line. When we purchased the restaurant they were using both Uber Eats and Amazon Restaurants (now defunct). We didn’t like the 30% fee from Uber Eats so we switched to Caviar, which offered us a better rate (22%) if we used them exclusively (even less for pickup orders or “direct referrals”). For simplicity I rolled all of these into 1 line.
Advertising — Direct advertising costs. Also where we record fees OpenTable charges us for reservations.

Side Note: Restaurants pay when you book a reservation online. If you really want to help restaurants lower costs, book a reservation through their website or call them directly, they pay lower or no fees.

Promotions — Costs associated with various promotions
G/C Comp — Gift Card Compensations, basically whenever we’ve given a gift card away as a thank you, make up for a mistake, etc.
Manager Repair — Covers “comped” items that we’ve provided to make up for missed items, unhappy customers, etc.
VIP/Promo — Covers discounts and comps relating to promotions, such as our “neighborhood” discount, special promotions, etc.
Charitable Contributions — Covers direct donations or other related items

General & Administrative

General costs associated with running the business.

Credit Card (CC) Processing Fee — Another big expense for restaurants. We track this number VERY closely and typically pay an average of 2.0% across all CC transactions (which is very low). Services like Square charge 2.75% + a transaction fee. We train our team how to avoid higher fees (avoid typing in card numbers, for example). Over 90% of our sales are via credit card so this number can add up in a hurry. A 0.5% fee change, when applied to $1M in annual sales, is a $5,000 change to our bottom line.
Dues & Subscriptions — Membership fees to various organizations
Gen Liab/Prop Damage Insurance — Self-explanatory
Professional Fees — Honestly I don’t remember what this was 😊
Legal & Accounting Fees — Our weekly payroll and accounting costs, along with annual accounting costs (like tax returns) and various legal fees. Running payroll ain’t cheap.
Protection/Security — Monthly security system costs
Postage/Delivery — self-explanatory
Office Supplies — self-explanatory
Cash Short/Over — Catch-all for differences in cash expected versus counted. Every business that handles cash has this. We round tips for our team so we routinely run a little short each week.
Bank Fees — Self-explanatory
Licenses and Taxes — All our taxes and licensing costs (liquor license, health permit, candle permit, security alarm permit, business license (WA), business license (Seattle), B&O taxes (WA).

Maintenance Costs

Stuff breaks down. A lot. Never on a Tuesday, always on a Saturday. And it’s expensive to fix.

Repair/Maint Equipment — Repair and maintenance costs for equipment, such as our air scrubber, refrigerators, etc.
Repair/Maint Restaurant — Repair and maintenance for anything other than equipment
Preventative Maintenance — You can either pay a lot in preventative maintenance or pay a LOT when stuff breaks.
Computer/POS Maintenance — Monthly support and licensing costs for our point-of-sale (POS) system

Occupancy

These are costs tied to the space we occupy (such as rent).

Parking/Employees — We rent 4 parking spaces in our building garage, 3 for our staff and 1 for us as owners
Telephone — Besides phone this also includes our Internet and TV bill (Comcast). No, that number is not a mistake for 7 months. Businesses pay much higher rates than residential accounts, and yes, we are getting screwed by Comcast. Take a number.
Cell Phone — We expense our cell phones as it’s the primary way vendors, candidates, and others contact us.
Trash Removal — Trash and food waste removal 2–3x/week
Equipment Rental/Lease — We rent our bar glasswasher and kitchen dishwasher equipment
Rent — Self-explanatory yet not. We have a “triple net” lease (also known as NNN) which means in addition to base rent we also pay a portion of insurance, taxes, and maintenance of our building on top of rent. In 2020 I started breaking out the triple net portion but for 2019 this includes everything. We pay nearly $100K/year just in rent and building costs. And we have a very favorable lease and amenable landlord.

Side note: Leases are probably the biggest factor into whether a restaurant will succeed or fail. Restaurants are at the mercy of commercial landlords in many ways (COVID-19 is showing this in stark terms). We are very fortunate to have a local landlord who is understanding of our situation and believes we need to share the pain of getting through this period.
Another side note: A key thing many people don’t realize is that most small business owners have to PERSONALLY guarantee their leases. This means if we close, we STILL have to pay rent. If our business goes bankrupt and we completely close down, we STILL have to pay rent out of our pocket. Who wants to put their personal finances on the line on a 5 year commercial lease? It is a huge risk that we, and every other small business owner, take on that very much puts us at the mercy of landlords. Because they can pursue owners for rent many landlords will refuse to negotiate or adjust leases. That is the power landlords have over small businesses.

Utilities — Electric — self-explanatory

The Finish Line

And there you have it. We now add up all our fixed and semi-variable costs and once you’ve deducted that you have the final operational net profit of our restaurant for 2019.

$82,697 (10.37%). This is the net profit our restaurant made from its operations in 2019.

As I mentioned at the beginning a 10% margin is really good. Before we pop the champagne though, we’re still not done. This doesn’t mean that we walked away with $82K last year. Far from it. There is still more to cover.

Other Income

This is income not related to operations.

In our case, interest from our savings account. I can’t even buy a coffee with this. For other restaurants this could include things like merchandise sales, etc.

Other Expenses

These are expenses not related to the regular operations of our restaurant.

Here we have 2 really big line items:

Interest expense — This is where we record the interest expense from our SBA loan that we used to purchase the restaurant. Since this is not related to the operations of the restaurant itself (the loan is financing, not operations), it doesn’t belong in our operational profit margin, but it’s still an expense (and a big one).
Owner Salaries — Finally comes our own salaries. For the first few months we underpaid ourselves until we understood our cash flow. Eventually we reached a point where we felt comfortable paying ourselves about $50K/year each. We take a salary to simplify our taxes and ensure a steady income for ourselves that we can demonstrate for credit applications, etc.

Net Profit

Finally we get to the net profit of the restaurant itself:

A whopping $12,000. That’s it. After paying our employees, all our bills, and ourselves a very modest salary, we are left with a very underwhelming 1.50% profit margin. And we would be considered a fairly successful restaurant.

But still, we run a profitable restaurant, right? Not yet.

A common misconception when reviewing P&L statements is that the net profit (or loss) represents how much more (or less) money a company has at the end of the year than it started with. But that’s not accurate because a P&L doesn’t show where all the money goes.

Any accounting student will tell you there is a trifecta of financial statements: the Profit and Loss Statement, the Balance Sheet, and the Statement of Cash Flows. Only with all 3 of these can you get a complete picture of the financial health of a company.

I’m not including our Balance Sheet or Cash Flow Statement because a) they contain personal information, b) they include one-time items that skew the “normal” numbers, and c) they aren’t relevant to my main point: which is that making money owning a restaurant is really, really hard.

That said, here are a few expenses that did not appear on our P&L but we still paid for:

New outdoor sign. Cost: About $4K. Since it is attached to the building it is considered an “asset” that gets depreciated over several years from our balance sheet.
SBA loan principal payments. Cost: About $17K. I mentioned our interest expense but what about the principal? Just like your home mortgage, every month part of the payment goes to interest and part pays down the loan. The interest gets expensed on our P&L but the principal portion gets recorded as a reduction of our loan amount (reducing the liability). This does not show up on the P&L but is a major cash outflow.

Those 2 examples alone account for over $20K in cash burn in 2019.

Just like that our (barely) profitable restaurant ended the year with $8,000 less in cash than we started with.

And that is how you run a successful restaurant and still lose money.

Conclusion

Put all that together and what do we have? A successful, profitable restaurant that ended up with less cash than it started with while paying its owners 1/3rd of what a tech worker makes in Seattle, with both owners working 50–60 hours/week. Remember on the spectrum of successful restaurants we are likely above average.

So if it’s so hard to make a profit why do it? That is a great question and this article is already too long. When I re-entered this industry I joked “I knew enough to know better.” But many people simply don’t realize just how hard this industry is to survive, let alone thrive. One goal of sharing these financial details is to put in stark terms the hard math of running a restaurant. It is much, much, more than cooking food and serving customers.

Anyone with a financial background would likely look at this P&L and decide it’s insane to open a restaurant. And for the most part they’re right.

As a business model, restaurants are broken.

The failure rate is super high, the hours are awful, the pay is abysmal, and your customers never seem happy. So why do it?

It’s called the hospitality industry for a reason; we love taking care of people. But it also means people take advantage of that dedication over the most meaningless things.

If we want to continue to enjoy the food, community, and culture that local, independent restaurants provide, we need to be aware how people have taken advantage of their giving nature and personal pride. Every time someone falsely complains about a meal to get it for free, or leaves a selfish 1-star review because of some trivial detail, it diminishes our entire industry.

And if we’re going to address the historical inequities in restaurant pay (particularly in back-of-house positions), we’re going to have to accept the fact that going out to eat is going to have to cost more than what we’ve grown accustomed to paying.

What does this mean for you, the intrepid restaurant consumer?

Be kind: support your local restaurants, but be patient as they are constantly adapting to new rules and restrictions, and remember they are working extremely hard to give you as great an experience they can under these incredible circumstances.

If you want to help local independent restaurants survive, here are a few simple things you can do:

Order take-out directly from the restaurant –Avoid ordering through 3rd party delivery services as much as possible. No restaurant can survive a 30% fee on their sales. Even something as simple as going to a restaurant’s website and clicking a link to a 3rd party service reduces their costs (they are charged a lower “referral” rate).

If the restaurant has their own online ordering, use it! They’ll keep 100% of the money, not 70%. Or call them directly. (Gen Z — your phone also makes calls, I promise)
Book reservations through the restaurant itself — Many online reservation platforms charge a per-customer fee for reservations booked, but the fees are often lower if you call them or book through the restaurant’s website instead of browsing through opentable.com or a similar service.
Show up! — No-shows are the ultimate insult to a restaurant, especially when we have limited capacity. If I can only have 6 tables inside, and you don’t show up for a reservation, not only do I lose your sales but I lose out on someone else taking that table because I was holding it for you. If you can’t make a reservation, be sure to cancel so the restaurant can find someone else to use the table.
Don’t hog the table — A key restaurant metric is “turns” — how many times a table is seated in a shift. Your meal is a transaction: You are seated, you order, you eat, you pay, you leave. When you sit and talk with your friends for an hour after your meal, you’re holding a table that could be used by someone else. That’s like staying in the movie theater after it’s over — you need to leave for the next show! If you’re having a great time, ask if it’s OK to stay or move to the bar and order drinks. We don’t want to have the awkward conversation asking you to leave, but you’re also costing us money and upsetting the next group waiting for your table.
Don’t leave bad reviews — In 99% of cases, a restaurant doesn’t deserve a bad review for your experience. If you didn’t have a good time, just don’t go back. There’s no need to bash them publicly for whatever happened. Or here’s an idea: Email the restaurant and explain what happened. We are in the hospitality industry — our goal is for people to have a good time and we want to make a bad experience right, but we can’t fix what we don’t know about.
Tip well! — You can read my article on tipping to understand why (yes, this includes takeout!)
Be patient — Restaurants are running on limited menus, staff, seating, capacity, and just about everything else. Remember we’re all human and doing our best.

I hope I’ve provided insight into how hard it was to run a successful restaurant pre-COVID. I assure you our 2020 P&L looks nothing like this one. As restaurant owners we’ve banded together with our peers to try and support each other, our employees, and our community as much as possible to survive 2020 and hopefully emerge from COVID stronger, but many others have been forced to permanently close.

As we begin to emerge from our year-long COVID lockdowns and consider how to re-open, we will never be able to go back to the way things were. Social justice movements such as BLM have highlighted the unfairness in our industry (whether it’s in BOH/FOH wages, racial equity, or other factors). We are not unique in struggling with these issues, but how we address them needs to be factored into how our business model changes as well. The end result will likely be seen in higher prices, modified service, or other ways to make our industry more sustainable both ecologically and financially. We have to understand what it took to run a restaurant pre-COVID for us to figure out how to make it work better for everyone in the future. At the end of the day a business that is not sustainable for its employees , owners, or investors is destined to fail.

Charlie Anthe is the co-owner of Moshi Moshi Sushi & Izakaya in Seattle, WA.