There's much more to Pod and the White Dog Cafe than the food coming out of the kitchen.
Students learned those restaurants' secrets yesterday from chef Philip Pinkney of the nearby Restaurant School.
A restaurant owner himself, Pinkney detailed the challenges facing an eatery, ranging from location and legal hurdles to bank fees and $40,000 liquor licenses.
What is of utmost importance, he added, is a passion for the business.
"You've got to believe that you will succeed," Pinkney said. "When you have no passion for what you're doing, you're not motivated to do well."
He said that the most difficult part of the process is recognizing a need in the restaurant community and filling that niche, citing cereal bar and cafe Cereality as a successful example.
After picking a location, a restaurateur then must find a viable property, preferably one that already has an established dining setting.
Funding, whether from bank loans or investment partners, becomes the next hurdle, Pinkney said. The more money you have, the easier it is to get it, he said.
"If you can go to the bank and prove you don't need the money, they'll give you whatever you want," Pinkney said.
Silent partners are often a bit trickier to handle, however.
"The silent never stay silent," Pinkney said. "They think they know what you're doing wrong, and they're not afraid to tell you."
Once a restaurant has finally gained enough capital to open, costs become an issue.
Liquor licenses, bank fees, equipment, remodeling expenditures and insurance fees are just some of the expenses a restaurant faces while trying to turn a profit.
But owners can do several things to try to cut their costs and increase their profits.
"If you do something on your own, you're just saving yourself money," Pinkney said. "If you can't, you've got to pay someone to do it, and that adds up."
Still, despite all of Pinkney's advice, he cautioned that the restaurant business is not nearly as simple as following a few basic rules.
About 75 percent of independent restaurants fail in their first year, and nearly 95 percent do in their first five years. Even the most prosperous eating establishments often only have a 3 to 5 percent return on investment.
The record of failure "is very intimidating," Engineering freshman Alan Hsu said. "But it seems like if you got into the business and liked it, you could be successful."
"It's a huge responsibility," added College senior Ann Koreisha. "You've got to have the expectation that you're not going to make a lot [of money]. But that just motivates me more to do well."
