Recap: First Month at the Restaurant

On Thursday we will have been open a full month. It's been tough, but we are headed in the right direction.

• Our sales are slowly improving, but are way lower than I anticipated. This is my biggest concern. It's hard to do anything without enough customers.
• Labor costs are steadily declining. Today we are operating on a skeleton crew: one regular hourly employee, two waitresses working staggered shifts, me and my business partner. Our total labor cost will be about $65 today - I can live with that.
• Food costs are also headed in the right direction but are still too high. Yesterday I completed an inventory and our food cost was 45% of sales. We need this to be under 28%. It is high because of overcooking and mistakes being made.

I am about to invest in some advertising. I can place a coupon in Val-Pak for the 20,000 homes nearest the restaurant for $489 per month. We are also posting fliers with our menu in various places and I send out a weekly email. The weather is also improving and that has to help sales as well.

We are still not out of danger of failing - that remains a high probability. But we've made huge improvements in the last 4 weeks.

My Frugal Miser - January Expenses: $3,259

My expenses for January were reasonable. I spent very little on food but a lot more on gas. I imagine this is my new reality now that I'm working in a restaurant.





January Expenses

$430 Auto ($202 for fuel, $228 Depreciation)
$1 Clothing
$71 Food (both groceries and eating out)
$10 Entertainment (movies, gambling, alcohol)
$113 Gifts Given

$185 Annual Homeowner's Association Dues
$190 Household (supplies, annual fire dues)
$100 Health Insurance
$0 Medical
$166 Interest on Debt (not including Mortgage Interest)
$0 Miscellaneous
$425 Mortgage Interest (primary residence)
$806 Mortgage Interest (rental properties)
$34 Personal Care

$0 Subscriptions
$492 Taxes
$237 Utilities
$0 Vacation

Total January Expenses : $3,259

Notes

• I guess one advantage of working in a restaurant is that I don't spend much money on food. My food budget was dramatically reduced in January.
• None of my other expenses were out of the ordinary in January.

My Frugal Miser - January Income: $7,573

January was a decent month - before we opened the restaurant we had allocated a pre-opening salary, but we deferred paying it until 2011 to avoid issuing W-2s. It doesn't look like I'll be taking much of a salary any time soon so January will be the exception, not the norm.

January Income
$957 Mystery Shopping*
$3,289 Rental Income

$3,000 Salary
$326 Other Sources
$7,573 Total Income for November
*I did virtually no mystery shopping in January; this represents payments made for work done in the past.

Notes:

• Rental income was lower than normal. I paid fire dues on 4 properties and had a couple of other irregular bills.
• The category "Other Sources" includes non-recurring (or semi-recurring) income since I always seem to have a little something that doesn't fall into the other buckets.

Vehicles and the True Cost of Ownership: How Much is My Car Really Costing Me?

Even though my daily commute is almost 90 miles, it looks like I'm driving less than when I was mystery shopping full-time.

I determined that each mile I drive costs me $.0867 in depreciation. In January I drove 2,628 miles. My vehicle depreciation expense was $227.85.

This is the least amount of miles I've driven since I started keeping track back in March of last year. I drive to work 7 days a week. I suppose the takeaway from this is that mystery shopping entails a lot of driving.