Will I make donuts and coffee

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pentyne: Nov 7, 2012

https://slate.com/human-interest/2005/12/my-coffeehouse-nightmare.html

quote:

The dream of running a small cafe has nothing to do with the excitement of entrepreneurship or the joys of being one's own boss�none of us would ever consider opening a Laundromat or a stationery store, and even the most delusional can see that an independent bookshop is a bad idea these days. The small cafe connects to the fantasy of throwing a perpetual dinner party, and it cuts deeper�all the way to Barbie tea sets�than any other capitalist urge. To a couple in the throes of the cafe dream, money is almost an afterthought. Which is good, because they're going to lose a lot of it.

The failure of a small cafe is not a question of competence. It is a sad given. The logistics of a food establishment that seats between 20 and 25 people (which roughly corresponds to the definition of "cozy") are such that the place will stay afloat�barely�as long as its owners spend all of their time on the job. There is a golden rule, long cherished by restaurateurs, for determining whether a business is viable. Rent should take up no more than 25 percent of your revenue, another 25 percent should go toward payroll, and 35 percent should go toward the product. The remaining 15 percent is what you take home. There's an even more elegant version of that rule: Make your rent in four days to be profitable, a week to break even. If you haven't hit the latter mark in a month, close.

A place that seats 25 will have to employ at least two people for every shift: someone to work the front and someone for the kitchen (assuming you find a guy who will both uncomplainingly wash dishes and reliably whip up pretty crepes; if you've found that guy, you're already in better shape than most NYC restaurateurs. You're also, most likely, already in trouble with immigration services). Budgeting $15 for the payroll for every hour your charming cafe is open (let's say 10 hours a day) relieves you of $4,500 a month. That gives you another $4,500 a month for rent and $6,300 to stock up on product. It also means that to come up with the total needed $18K of revenue per month, you will need to sell that product at an average of a 300 percent markup.

Pastries, for instance, are a monetary black hole unless you bake them yourself. We started out by engaging a pedigreed gentleman baker with Le Bernardin on his r�sum�. Hercule, as I'll call him, embodied every French stereotype in existence: He was jovial, enthusiastic, rude, snooty, manic-depressive, brilliant, and utterly unreliable. His croissants were buttery, flaky, not too big, and $1.25 wholesale. We sold them for $2 and threw away roughly 50 percent�in other words, we were making a negative quarter on each croissant. After a couple of months of this, we downgraded to a more Americanized version of the croissant (vast and pillowy). The new croissants ran 90 cents each and made us feel vaguely dirty. We sold them for the same $2. Ironically, their elephantine size meant that every time someone ordered a croissant with cheese, we had to load it up with twice as much Gruy�re.

Coffee was a different story�thanks to the trail blazed by Starbucks, the world of coffee retail is now a rogue's playground of jaw-dropping markups. An espresso that required about 18 cents worth of beans (and we used very good beans) was sold for $2.50 with nary an eyebrow raised on either side of the counter. A dab of milk froth or a splash of hot water transformed the drink into a macchiato or an Americano, respectively, and raised the price to $3. The house brew too cold to be sold for $1 a cup was chilled further and reborn at $2.50 a cup as iced coffee, a drink whose appeal I do not even pretend to grasp.

But how much of it could we sell? Discarding food as a self-canceling expense at best, the coffee needed to account for all of our profit. We needed to sell roughly $500 of it a day. This kind of money is only achievable through solid foot traffic, but, of course, our cafe was too cozy and charming to pop in for a cup to go. The average coffee-to-stay customer nursed his mocha (i.e., his $5 ticket) for upward of 30 minutes. Don't get me started on people with laptops.

There was, of course, one way to make the cafe viable: It was written into the Golden Rule itself. My wife Lily and I could work there, full-time, save on the payroll, and gerrymander the rest of the budget to allow for lower sales. Guess what, dear dreamers? The psychological gap between working in a cafe because it's fun and romantic and doing the exact same thing because you have to is enormous. Within weeks, Lily and I�previously ensconced in an enviably stress-free marriage�were at each other's throats. I hesitate to say which was worse: working the same shift or alternating. Each option presented its own small tortures. Two highly educated professionals with artistic aspirations have just put themselves�or, as we saw it, each other�on $8-per-hour jobs slinging coffee. After four more months, we grew suspicious of each other's motives, obsessively kept track of each other's contributions to the cause ("You worked three days last week!"), and generally waltzed on the edge of divorce. The marriage appears to have been saved by a well-timed bankruptcy.

Looking back, we (incredibly) should have heeded the advice of bad-boy chef Anthony Bourdain, who wrote our epitaph in Kitchen Confidential: "The most dangerous species of owner ... is the one who gets into the business for love."

All of this presumes simply paying the normal minimum wage, not whatever weird social program you are envisioning.

# ¿ Oct 17, 2022 02:24

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# ¿ May 15, 2024 00:01

pentyne: Nov 7, 2012

Talk to a single restaurant owner, and they will tell you they don't own the restaurant, the restaurant owns you

# ¿ Oct 17, 2022 04:46

pentyne: Nov 7, 2012

Powerful Katrinka posted:

Pretty much everyone uses donut mix, including the fancy shmancy places. Same with fancy cakes, you're getting cake made with mix bought in fifty-pound bags. That's one thing I don't find fault with, to be honest

It usually comes down to a lot of really specific baking, precise weights and all, and someone on the back end to do all the fancy pastry decorating. Also freshness, like a matter of hours will make a huge difference in quality.

For comparison, there's a fancy donut shop I go, and the have the best donuts around by far, but a dozen of the "premium" donuts is $35 and their regular is $22. The shop is basically a large kitchen with little to no room between rolling metal baking tray racks that someone came in at 2am to bake and carefully decorate including making character designs and then they work until ~1pm and close. Last time I was there I heard them say they had to throw out at least one entire tray because the prep person ran out of time to frost/decorate them.

# ¿ Oct 17, 2022 06:17

pentyne: Nov 7, 2012

Rationale posted:

I’m lead bidder on a 40 quart mixer.

As far as having a standout product: the distributor sells different grades of mix and the premium stuff tastes much nicer. I can also dress them up with captain crunch or whatever to make them a bit more distinctive.

Actual doughnuts are much newer to me but I know that the real profit margins are there. It costs a quarter to make a cake donut and like a dime to make a classic raised glazed. I also personally prefer yeast doughnuts and I’m more interested in mastering their craft.

I think $2 or $20/dz will make money on the donuts I gently caress around with so long as I gently caress around expeditiously.

I think $1 for a raised glazed won’t bankrupt me.

Pretty sure the industry standard is you can expect to throw away nearly 50% of your baked goods every day if you aren't a massive sell out success, like Instagram famous attention level.

pentyne fucked around with this message at 16:01 on Oct 17, 2022

# ¿ Oct 17, 2022 15:44

pentyne: Nov 7, 2012

Also no idea what food costs are but $1 for basic glazed is like the cheapest possible. Krispy Kreme charges more then that.

That's not wow people with my amazing donut prices that's "on my way to work and cheap coffee and some sugar"

# ¿ Oct 17, 2022 16:20

pentyne: Nov 7, 2012

All the local "baking" phenomena I've see in area food blogs and local news are people who set up a grey kitchen (or whatever its called for cooking in your home) and have been baking and selling for years before word gets out about this amazing insanely good baked item.

# ¿ Oct 17, 2022 20:41

pentyne: Nov 7, 2012

GoGoGadgetChris posted:

DoughverHaus

# ¿ Oct 18, 2022 02:37

pentyne: Nov 7, 2012

It's weird you are buying restaurant stuff in bulk because of getting such great "deals". This usually ends with a restaurant full of lovely, old, mismatching d�cor and things that break where you have no warranty or service contract for repair so it costs 4x to get it fixed.

# ¿ Oct 18, 2022 17:31

pentyne: Nov 7, 2012

Sundae posted:

TikTok keeps trying very hard to convince me that lingerie baristas are a thing. Maybe he can throw on a corset and work front counter too.

That's been a thing in CA for decades for the lingerie Vietnamese coffee places.

# ¿ Oct 18, 2022 18:02

pentyne: Nov 7, 2012

All this talk about donuts and nothing about the coffee.

What's your coffee price point gonna be? I know the US is pretty infamous for the Starbucks overpriced coffee culture, but you're either competing with literal gas stations or those $6/cup hipster shops that import and roast their own beans. People want one or the other, it's not an interchangeable product experience.

# ¿ Oct 20, 2022 17:08

pentyne: Nov 7, 2012

Rationale posted:

The sort of people you see walking around downtown here aren�t the type you�d want in your store.

You're going to need to explain this because it's coming off as seriously racist or classist.

# ¿ Oct 20, 2022 18:17

pentyne: Nov 7, 2012

Rationale posted:

You all keep acting like nothing I plan to do will work and then after the fact you act like it�s small potatoes so am I incapable of loving this chicken or do I have a slutty hen on my hands? It can�t be both ways, mr grumpy.

Instead of spending $20k on a bunch of used equipment you have no idea the condition of and would have to pay a premium to repair since you aren't the original owner and it's not under warranty, you could just buy the really important stuff new and not worry about literally every problem that comes will buying heavy duty use equipment second hand.

# ¿ Oct 28, 2022 20:10

pentyne: Nov 7, 2012

While you won't be the one paying the $300 minimum service visit charge, the issue pointed out is a lot of those machines will be incredibly hard to source parts for if at all, and if your plan is to just fix it as needed with elbow grease, then in addition to trying to work as a baker your also planning to be spending an unknown time working as a unpaid repairman for the store.

# ¿ Oct 28, 2022 20:39

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# ¿ May 15, 2024 00:01

pentyne: Nov 7, 2012

Sundae posted:

This is fabulous.

Donuts suck in CA, at least bay area. People are like, "omg there's fruity pebbles on it and a live chicken cooked into the bear claws!" but it's really just to mask that the place sucks at donuts for some reason so random-rear end novelty toppings are all they have to work with. Hell yeah, let me pay $7 for a single grocery-store grade donut. Support small (terrible) businesses!

Also, CarForumPoster - we're pissed at him because he hasn't even made a goddamned donut yet. I don't mean "on his new equipment." I mean ever.

Given how many 24hr cash only donut shops there are in Socal I've always been convinced they were money laundering fronts.

# ¿ Oct 29, 2022 17:13

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