OPINION: Why restaurants are so f**ked

[Thaiger]

Article by Guest Blogger Joelle Parenteau (This article contains some strong language that may offend some people) Covid 19 is about to kill restaurants by the thousands. This pandemic is the ultimate pressure test and restaurants are failing hard. Think about it: when we come out of this, your favourite food spots might not be there any more. Why are they so f***ed? Let me explain. Margins in the restaurant industry are notoriously small. Like tiny, actually. For reference, margins for banking, accounting, and legal services come in around 18–25%, healthcare 12-15%, and software 15–25%. Restaurants? 3–9%. Ya, like single […]

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[Abbis]

Am I in?

Lol, definitely not! Why should I pay more for helping these restaurants to increase their price list?

I mean, competition is there and must always be, especially in an age when everything is becoming more expensive.

If the pandemic brings them to failure, then they will have no choice but to close. Those who will survive will reflourish once the pandemic will be over. There is an exaggerate number of restaurants and food chains in the world and especially in Phuket.

By the way, If you are rich and have enough money to support yourself and them, then go and do it. 

I personally will survive without them. If they fail? What's the problem? I will start to cook more at home and make some fresh homemade dinner.

[Julius]

While I dont disagree with the point being made, its not like the customers decided on the price of menu items. You're the one that needs to increase prices and if your product is worth it, people will pay. 

Furthermore, it's not that restaurant workers are devalued, rather too many people want to open restaurants and the competition bids each other out of their profits.

[AlexPTY]

language is not strong enough IMHO, we all are so f**ked

i cook and drink home, chicks love me, never had so many dinner dates like this year

Edited August 16, 2021 by AlexPTY

[Noel]

An interesting article.

The statistics on normal restaurants in the West where over 50% of restaurants fail in their first year tells us a good starting point which this article reinforces. The lack of business awareness from wannabe restaurateurs is the reason most of these businesses fail. Why would you try and sell a product without first knowing your cost and anticipated sales and profit margin. Just because you like food and like to cook does not make you suitable to run a business and vice versa. The rule of thumb is never less than 10% profit, these companies are not Amazon who can do this by huge turnover. If profit is less than 20% you dont have a via business do something else.

The article clearly refers to the way you will fail as a restaurant. You can only compete on quality and service if this is good people will pay, we all have a favorite place and a place we wont eat. Returning customers are the only way for success.

Restaurants are failing now as they have had no income since December and no line of credit as they are a bad risk to banks. They probably dont owe enough money to make it the banks problem instead.

Most restaurants/street food in Thailand are family businesses with enough money to feed the family but when the income disappears so do they. Let us face it no one saw Covid coming so no one made any provisions for it. 

The lack of any welfare system in Thailand then compounds this problem as there is no money to help.

[Chinalarry]

Runnng a restaurant can be very unrewarding. The investment can include long hours and dealing with difficult customers.  But your article completely ignores a very important profit centre, and that is alcohol. Beers, spirits and wines add substantial to gross income and are not perishable. They are often sold at multiples of the cost. It is widely known that they are in fact the major contributors to overall profitability. If food covers the fixed costs of running the restaurant plus the variables such as labour plus damages and kept, then drinks provide the gravy.

[Dedinbed]

Good article but cluck me did it go on abit .. 

[King Cotton]

39 minutes ago, Julius said:

While I dont disagree with the point being made, its not like the customers decided on the price of menu items. You're the one that needs to increase prices and if your product is worth it, people will pay. 

Furthermore, it's not that restaurant workers are devalued, rather too many people want to open restaurants and the competition bids each other out of their profits.

Valid comment, for sure and thanks for this, your debut post!

Hello, Julius and welcome to Thaiger Talk

Please feel free to tell us a bit about yourself in 'Introductions'. It's good to pick-up on those sometimes differing regional or geographical perspectives.

And check-out the Guidelines, too, when you get a free minute. They're there to help us all enjoy our time here.

Happy posting

King Cotton

[AdvocatusDiaboli]

56 minutes ago, Thaiger said:

This pandemic is the ultimate pressure test and restaurants are failing hard.

Oh really. 
https://www.chiangmaicitylife.com/citynews/covid-19/chiang-mais-10000-plus-restaurants-down-to-under-2000/

still plenty to choose from in CM.

By supporting your favourite restaurants increasing menu prices. That’s it. For too long they’ve avoided doing this out of fear that we would rebel. Armed with new knowledge, let’s be more understanding. That’s how we #supportlocal. That’s how we keep enjoying our favourite foods.

Sounds like Joelle Parenteau may just be in the Restaurant Business. 
 

Ones that are still open have a good local trade and are not reliant on Tourists (both Foreign and Domestic), Have reasonable rent or own outright, are not reliant on alcohol sales (which Joelle does not mention), and finally in areas of good foot traffic for what they are offering. It does not matter how one or two people feel about supporting local with increasing the price of food, it is what the majority of their customers will do with foot traffic, and an increase may just price them out of the market. 

[Lowseasonlover]

I dont know about where you guys live but in the small tamboon where I live there has been a number of new places opened in the last few months I dont know where they think the business is going to come from the area we live has not been to badly still a fair few farangs live here,

My wife is a great cook Im sure she can make me anything I want, she make all our bread tonight she is making pizza's, I drink at home and have done for a long time now were as I used to go out every night.

I see on FB lots of restaurants around where I live and were they are getting their prices from I dont know, more to the point who is paying them prices..........?

On Sunday we went for a drive and went to Phuket town for lunch my wife said she wanted to try this new place so we park up and walk in ok nice place Im looking at the menu I thought WTF this is more than 5 star hotel prices the average is 500 baht a dish FFS it's only lunch time my wife agreed with me Im not paying them prices we got up and walked out, drove up to Khao Rang better view 60 baht chicken fried rice, she had Kengsom Kung and Chicken satay was nice and cool 

 

[King Cotton]

32 minutes ago, Noel said:

An interesting article.

The statistics on normal restaurants in the West where over 50% of restaurants fail in their first year tells us a good starting point which this article reinforces. The lack of business awareness from wannabe restaurateurs is the reason most of these businesses fail. Why would you try and sell a product without first knowing your cost and anticipated sales and profit margin. Just because you like food and like to cook does not make you suitable to run a business and vice versa. The rule of thumb is never less than 10% profit, these companies are not Amazon who can do this by huge turnover. If profit is less than 20% you dont have a via business do something else.

The article clearly refers to the way you will fail as a restaurant. You can only compete on quality and service if this is good people will pay, we all have a favorite place and a place we wont eat. Returning customers are the only way for success.

Restaurants are failing now as they have had no income since December and no line of credit as they are a bad risk to banks. They probably dont owe enough money to make it the banks problem instead.

Most restaurants/street food in Thailand are family businesses with enough money to feed the family but when the income disappears so do they. Let us face it no one saw Covid coming so no one made any provisions for it. 

The lack of any welfare system in Thailand then compounds this problem as there is no money to help.

So many valid points, here, re the restaurant industry's present dilemma and sorry I missed your debut post the other day.

Hello, Noel and welcome to Thaiger Talk

Please feel free to tell us a bit about yourself in 'Introductions'. It's good to pick-up on those sometimes differing regional or geographical perspectives.

And check-out the Guidelines, too, when you get a free minute. They're there to help us all enjoy our time here.

Happy posting

King Cotton

[Stardust]

4 minutes ago, Lowseasonlover said:

I dont know about where you guys live but in the small tamboon where I live there has been a number of new places opened in the last few months I dont know where they think the business is going to come from the area we live has not been to badly still a fair few farangs live here,

My wife is a great cook Im sure she can make me anything I want, she make all our bread tonight she is making pizza's, I drink at home and have done for a long time now were as I used to go out every night.

I see on FB lots of restaurants around where I live and were they are getting their prices from I dont know, more to the point who is paying them prices..........?

On Sunday we went for a drive and went to Phuket town for lunch my wife said she wanted to try this new place so we park up and walk in ok nice place Im looking at the menu I thought WTF this is more than 5 star hotel prices the average is 500 baht a dish FFS it's only lunch time my wife agreed with me Im not paying them prices we got up and walked out, drove up to Khao Rang better view 60 baht chicken fried rice, she had Kengsom Kung and Chicken satay was nice and cool 

I guess you are in a province where the restaurants still have open and dining inside, in the dark red zones the situation is a different one.

[AdvocatusDiaboli]

Really, look when this was written, on their blog site.

https://joelleparenteau.medium.com/why-restaurants-are-not-f***ed-80383594c593

April 13 2020. 
 

[Benroon]

43 minutes ago, AlexPTY said:

language is not strong enough IMHO, we all are so f**ked

i cook and drink home, chicks love me, never had so many dinner dates like this year

Depends what standard of 'chick' you're after. The average hungry street milf in her tracksuit bottoms might be ok to dine in your kitchen, but anything classy is going to want to be fine dined in her tiny black little number that she's nearly starve herself to death to get into. Quality costs !

[King Cotton]

32 minutes ago, Chinalarry said:

Runnng a restaurant can be very unrewarding. The investment can include long hours and dealing with difficult customers.  But your article completely ignores a very important profit centre, and that is alcohol. Beers, spirits and wines add substantial to gross income and are not perishable. They are often sold at multiples of the cost. It is widely known that they are in fact the major contributors to overall profitability. If food covers the fixed costs of running the restaurant plus the variables such as labour plus damages and kept, then drinks provide the gravy.

Yes, who the hell would want to run a restaurant, eh? That said, the Mrs and I did want to but once we'd considered all the P's & C's, we reckoned there were too many C's and just went for a nice little sandwich cafe instead. And your debut post, too, so big thanks for that!

Hello, Chinalarry and welcome to Thaiger Talk

Please feel free to tell us a bit about yourself in 'Introductions'. It's good to pick-up on those sometimes differing regional or geographical perspectives.

And check-out the Guidelines, too, when you get a free minute. They're there to help us all enjoy our time here.

Happy posting

King Cotton

[DavidK]

I am not in and based on the content of the article I would not be a patron of the author's establishment. I suspect my ears would be assailed by foul and squalid language quite unnecessarily.

[EdwardV]

“most make minimum wage.” - I was in San Francisco this weekend for work, and while walking around I saw an employment advertisement at a local Chipotle (Mexican fast food) restaurant. They were offering $20.50 USD per hour starting salary. No doubt you can’t live on that in SF, but that sill a good 30% over minimum wage. 

[Benroon]

1 hour ago, DavidK said:

I am not in and based on the content of the article I would not be a patron of the author's establishment. I suspect my ears would be assailed by foul and squalid language quite unnecessarily.

We definitely need a 'confused' emoji !

[KLS]

I fully agree with the article. I love staying in Thailand for many reasons, one of which is the cost of living but the cost of eating out (excluding pricy restaurants) is as the article says, unrealistic. I’ve often wondered how they price their food as I’ve calculated the cost of the ingredients and materials and always come up more than the price of the dish. 

[dmacarelli]

In the dark red zones the restaurants are being crushed by the goon squad. Open, closed, open again, then closed. Few businesses can sustain that kind of punishment. 

They continue to oppress the people due to their own massive failures. The price the Thai people have paid by allowing the army goons to take charge will not be understood for many years to come. Both tourism and the economy here are shot. And Covid is only a small part of that. 

[King Cotton]

21 minutes ago, KLS said:

I fully agree with the article. I love staying in Thailand for many reasons, one of which is the cost of living but the cost of eating out (excluding pricy restaurants) is as the article says, unrealistic. I’ve often wondered how they price their food as I’ve calculated the cost of the ingredients and materials and always come up more than the price of the dish. 

Yes, food for thought, there (pun intended!) And a tasty debut post, too . . . thanks for that!

Hello, KLS and welcome to Thaiger Talk

Please feel free to tell us a bit about yourself in 'Introductions'. It's good to pick-up on those sometimes differing regional or geographical perspectives.

And check-out the Guidelines, too, when you get a free minute. They're there to help us all enjoy our time here.

Happy posting

King Cotton

[Dooleygank]

Some fake pretty girl sellin some fake hipster "german" doner kebab (Turkish). Not sure why people waste their time.

I get some killer gai yang (grilled chicken skewers) from my local chicken man. They are so damn good. 10 baht each and are loaded with meat. Get a stack of those every time. He looks like hes actually doing pretty good. Cooking 50+ skewers at a time and always selling out as fast as he can make them. His wifes making all kinds of som tum and isan foods. Cheap, delicious... Everybody is happy. 

 

Anyone who is in Korat should check his food out. Hes the one with the chimney stack across from Fort Suranaree Army Hospital.

[TukTuk]

She hasn't said anything that a first year business student didn't already learn. Her use of fowl language takes away any credibility from this story.

[King Cotton]

31 minutes ago, Dooleygank said:

Some fake pretty girl sellin some fake hipster "german" doner kebab (Turkish). Not sure why people waste their time.

I get some killer gai yang (grilled chicken skewers) from my local chicken man. They are so damn good. 10 baht each and are loaded with meat. Get a stack of those every time. He looks like hes actually doing pretty good. Cooking 50+ skewers at a time and always selling out as fast as he can make them. His wifes making all kinds of som tum and isan foods. Cheap, delicious... Everybody is happy. 

Anyone who is in Korat should check his food out. Hes the one with the chimney stack across from Fort Suranaree Army Hospital.

Hm-hmm! Your description of those chicken skewers has made me hungry, again and I had my dinner only an hour ago. An excellent post and sorry I missed your debut one, the other day . . . secretary on her lunch break, probably.

Hello, Dooleygank and welcome to Thaiger Talk

Please feel free to tell us a bit about yourself in 'Introductions'. It's good to pick-up on those sometimes differing regional or geographical perspectives.

And check-out the Guidelines, too, when you get a free minute. They're there to help us all enjoy our time here.

Happy posting

King Cotton

[semrand753]

Every industry is about supply versus demand.

Sure, supply is dropping, but nowhere near to a level where it might become hard to fulfill demand. To raise prices as a single restaurant without losing too many customers, you'd first have to drain supply (of cheap meals) by getting just about all restaurants to agree to price inflation.

A whole lot of organization, collaboration (at a national level), and time is required to get into a position to be able to achieve that. Objectively (but somewhat harshly and without nuances) put, it'd be easier if the entire restaurant-scene would collapse to ground-zero, so that it could be rebuilt from scratch in a new model.