Ask Craig Scharton: How is year 2 different?

Posted by Craig Scharton

Our incredible communications director, Kim Leonard asks the staff at the Downtown Fresno Partnership to write an occasional blog.  I had a little time between meetings this afternoon, so I asked Kim to ask me a question, and my answer would be my occasional blog post.  Kim asked about my experience about being a second year business owner, as compared/contrasted with being a first year business owner.

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Dear Kim,

Year two is a cakewalk compared to year one.  I’d never owned a restaurant before.  I had cooked in restaurants.  I had marketed restaurants.  I’d done restaurant-focused events.  And I’d certainly done my share of eating in restaurants.  But just like everything else in life, if you haven’t done it, you haven’t done it. I do have some restaurant owner friends, who were kind enough to take my call when I had a question (Thank you Sharon and David Alexander, Dave Fansler, Jim Pardini, Bobby Salazar, Tom Ferdinandi, Joann Sorrenti). I do believe in using mentors.

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The hardest part about year one is that there aren’t any systems in place. No memorized financial reports, no labeling equipment for merchandise in our market, no payroll system, no linen service (more on this later), to employee training.  It all has to be made up on the spot and all at once.  Oh yeah, we had a couple of other complications: the person who was going to do breakfast and lunch backed out a couple of days before we opened, we were on the mall, our first chef wanted to do a daily changing menu. We also decided to do breakfast, lunch and dinner.

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There were so many other complications in the first year.  We applied to change our Alcohol license and City Conditional Use Permit.  We wanted to expand our hours past 11:00pm and to be open on Sundays.  We also wanted to include outdoor dining.  We had to manage through these processes, while we were trying to figure everything else out.  It took Comcast months before telling us that they couldn’t get service to us.  So in the meantime, my personal cell phone was the business phone, I received 20-30 calls per day for directions, daily menu or from stoned guys at 1:00am asking if we delivered.  Staff turnover was high, as chaos and sleep deprivation took their toll. Rumors about our chances of survival lowered morale.

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But then something encouraging happened, almost unheard of in the world of restaurant start-ups.  In month five we broke even.  We were back in a deficit in months six and seven, but then we started a consistent pattern of growth, which also gave us a chance to begin understanding and lowering our expenses.  We began to see a business model that could work. By the time we celebrated our first anniversary, we only had two of our original team with us.  But we are very grateful to everyone that put their shoulder to the grindstone.  First gear does a lot of hard work to get a car moving.  The early team did much of the work that later people would build from.

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Year two is still challenging.  But it is more a drive to be better.  We have our QuickBooks, our Point of Sale, our Payroll and Insurance.  Johnny Q books and promotes the bands.  We have our outdoor dining, we’re open on Sundays and stay open until 1:00am on Friday and Saturday.  We have changed the daily menu into a monthly menu, with more items, and we serve food from 11:00am-9:00pm.  There is more selection, more consistency and the customers have responded positively.

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We are always trying to improve.  We want food to come out more quickly. We want to handle large crowds more efficiently (a good problem to have). We want to have clearer financial tracking so that we can make good decisions, but revenues have doubled since the end of year one.  The biggest change in year two has been developing our regular customers.  They are the ones who really make the business model work.  We are lucky to have people who come in 4-7 times per week.  It takes time to develop that regular clientele.  That has been a huge learning experience.  Our regulars are GOLD! So those of you who want downtown to flourish, remember that you play the most critical role in our success.  Patronize the places that you want to succeed. And hang in there with them as they figure things out.

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Year three and half of year four will have construction during the Fulton Mall/Street conversion, so there is plenty of choppy water ahead.  But we’ll be open every day, along with all of our other neighboring businesses. After that, we’ll be in full blown renaissance mode.

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Thanks, Kim, it was a fun exercise to look back and to share.

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Craig Scharton

Fulton Mall Manager for Downtown Fresno Partnership and Owner of Peeve’s Public House & Local Market

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