Short interview clip where Donald Burns asks why many restaurants struggle to be profitable. The guest argues the main issue is owners not knowing their numbers (unit cost, profit margins, cost breakdowns like rent, labor, COGS), plus neglecting basics such as waste management and overreliance on apps instead of simple documentation and hands-on experience.
So, you know, a lot of restaurants struggle with profitability. What do you think is the biggest problem? National restaurant does only 5% profit. What do you think is the problem? What do you think stands in the way of restaurants making? I mean, when it comes to profitability, what do you think is one of the biggest problems?
You see, I think the biggest problems is just that a lot of owners don't know their numbers, right? And so the issue with that is tenfold, because if you don't know your unit cost, you really don't know the exact, like, ratio you're selling for, you then don't know your profit margin you need. A lot of owners don't even know what percentage rent should be at versus labor versus, like, cost of goods sold because they hire people to run their business. But, you know, I feel very fortunate from my past restaurant experience that I myself worked the counter and from there I've worked my way through of wearing all the hats and understanding all the different areas that you have to pay attention to or, like, people don't even pay attention to, like, something as simple as waste management. Sometimes we just have to get back to the traditional bones of, like, a PDF document that's printed. And your team might like that better than, like, going to an app and like, taking. I mean, this app culture sometimes is. Is like ruining restaurant culture, because, like, sometimes it's just as simple as writing something down and talking about it, you know?
If your restaurant only works because you work 80 hours a week, it doesn't work.
