[OPENING MUSIC]

00:00:00 Alex VO: The Build is presented by Square. Opening your first restaurant is a one of a kind challenge. Building the systems, team and infrastructure to grow beyond is another. This season we're going beyond the basics and into Restaurant 201, following what it really takes to scale a restaurant concept without losing the hospitality, culture and food that made it special in the first place. Square supports businesses at every stage with connected tools designed to help restaurant owners run their operations, understand their business, and keep growing. This is The Build: Season Three, presented by Square.

00:00:46 Jenny VO: You’re listening to The Build: A show about what it really takes to open a restaurant.

[THEME MUSIC]

00:00:55 Jenny VO: Welcome to The Build Episode Six, where we had planned to talk about some of the realities of expanding the restaurant group. But as can be expected from putting five industry folks into one room, we reverted a bit into Talking food.

00:01:06 Alex VO: A fun conversation, of course, but we didn't want to miss the opportunity to touch on that original topic for you, the listener. So later we caught up with Lauren Fernandez, CEO of Full Course. Full course works with multi-unit concepts and emerging brands on strategy and execution.

00:01:21 Jenny VO: Stay tuned at the end of the episode for a few excerpts from our conversation.

00:01:26 Alex: Give us an update on what's happening at Peludo this week and or what happened last week.

00:01:32 Gio: So last week we talked about this contractor that we really like. He worked with us in Socceria, and he's been building other really cool restaurants. But unfortunately, his schedule is really chaotic right now. So we decided to spread the work flow between us and try to see how much we could really do ourselves and like maybe different contractors that, you know, it will just involve us more in terms of like making the decisions of, um, pretty much everything, but like we're not going. The sad part, but the good part is like, we have other really good contractors that we can work with. And he's really, you know, on it. And he, he was the one who already built our bar and renovated our basement. So it kind of makes sense to continue with him in this next phase, which is more most of the, uh, finishing and the details. Um, but it will, it will definitely just involve more of our own work in terms of making decisions and making research of things that we want to source for the space. So yeah, we're, we're moving forward, but, um, with a little change on, on the plan on how we want it to work.

00:02:56 Jenny: So it sounds like you personally are going to be doing some of the construction.

00:03:00 Gio: Yeah. I mean, Carlos is gonna start doing some chemistry.

00:03:04 Jenny: Some chemistry.

00:03:05 Gio: Yeah.

00:03:06 Jenny: Tell us what that means.

00:03:07 Carlos: I'm trying to age the galvanized finishing of the bar, because right now it looks just so shiny, and we want it to look a little like.

00:03:15 Jenny: Yeah.

00:03:15 Carlos: Older. So I'm gonna.

00:03:17 Alex: Wear. Is there galvanized on the bar?

00:03:19 Carlos: It's in the bottom. It's like the whole front. It's galvanized. So I'm gonna do some samples this week. Let's see. I've been watching so much YouTube.

00:03:28 Alex: YouTube, YouTube.

00:03:29 Carlos: Project. Yeah. It's like, it looks so easy, but I really feel like it might be a little bit more tricky that how it looks. But we'll see. Maybe I ask for your help. I know, I know, I, I know you.

00:03:42 Jenny: You know, I know I.

00:03:44 Carlos: I know you are very handy.

00:03:45 Jenny: He is very handy. I'm dead. I'm dead. I'm here.

00:03:50 Carlos: I feel like you could get it done, Alex.

00:03:54 Jenny: So by by. Carlos doing it, you mean? Alex, I love it. Podcast host to a part time contractor.

00:04:02 Alex: For as long as I get a chill when it comes out, I'll be there to help you. Yeah.

00:04:07 Jenny: I'm dad. He's actually probably really excited about this. He loves this.

00:04:10 Alex: Shit. I'm in, I'm in.

00:04:12 Jenny: Wait. Um. Okay, so Alex and, uh, and Carlos are going to galvanize the bar.

00:04:19 Alex: More project managing details than you intended to be. Yeah.

00:04:23 Gio: And we also have we've been working with this friend. I think we talk about her for a little bit. Uh, her name is Molly Bloom. Yeah. She's been helping us with some design, um, decisions and like, you know, proposing us like certain layouts for, uh, furniture and lighting and things.

00:04:44 Alex: This is the same person that did the, the tile mosaic. Okay.

00:04:48 Jenny: So who's going to actually install? Will she be able to actually install the mural? Because I thought that was something the contractor had to do.

00:04:53 Gio: Yeah. We were his name. Our new contractor. Who is who built the bar already? His name is Simon. He's gonna do it. With her guidance.

00:05:03 Alex: Got it?

00:05:04 Carlos: Yeah.

00:05:05 Jenny: We love Simon.

00:05:06 Alex: Yeah. And I think, um.

00:05:07 Jenny: Eric's contractor.

00:05:09 Alex: You guys didn't answer the question, but how does it change the timeline?

00:05:12 Gio: Uh. It will. We still want to stick it on a month from now, right?

00:05:18 Jenny: It was a month from now. Last time we met, which was two weeks ago. So now.

00:05:23 Alex: No pressure. No pressure, no pressure.

00:05:25 Jenny: So we just for we had benchmarked, um, July twenty ninth as opening date.

00:05:32 Tania: A while ago. Yeah.

00:05:34 Gio: No, honestly, now it's looking. So we actually have to make a difficult decision. But it's. But we all feel comfortable with this. Just last week we we started like thinking and planning on the opening. And, um, just because there's also Carlos wedding and honeymoon. Kind of like at the beginning of August. We. We just made the decision to actually open once Carlos is back from his honeymoon. So that will be actually be mid-August that we that that's our new date for opening.

00:06:12 Jenny: Okay, so double measles, we got a wedding, a honeymoon and an opening all happening. Boom, boom, boom.

00:06:18 Carlos: I know, I'm very excited. I think he's really feels very relaxing to think that we're gonna go one thing at a time.

00:06:26 Gio: Yeah, I feel better that way, too, because you're you're you're wedding. You know, you have to have the time and space to.

00:06:34 Jenny: Can't be getting called at the walk in. Went down on your honeymoon. Yeah. On the first day.

00:06:39 Gio: And after your honeymoon, you, you know.

00:06:42 Tania: Feel a little more full speed.

00:06:44 Jenny: Honeymoon will literally be over.

00:06:48 Alex: The.

00:06:48 Carlos: Day we come back. It's like honeymoon is over.

00:06:51 Gio: Yeah.

00:06:52 Carlos: Let's hope. open up a little.

00:06:53 Alex: So you have. So you need to do the mosaics. You need some details like the antiquing, the bar. Mhm. What else needs to happen? The floors are painted. Not yet.

00:07:02 Carlos: No.

00:07:02 Alex: Your furniture, the walls. You ordered more furniture?

00:07:06 Tania: Uh. The stools. I feel like we still haven't talked about the stool.

00:07:10 Gio: And lighting.

00:07:11 Alex: And lighting. Like, actually light fixtures. You're not actually, you're not going back and doing more electrical, putting new things in place. Right?

00:07:18 Gio: Just more and more, more fixtures. Yeah. We're trying to make current some of the lighting that is already in the space that it seems like really old. And so we're just kind of updating that system and, and adding new lights.

00:07:32 Jenny: Lighting is so important now. I think with, um, obviously like Instagram people taking pictures. How do you think about that?

00:07:39 Tania: Yeah. I mean, it has to be moody too at some point. Like obviously in the daytime, it's very bright, even though there's just kind of like a one window, but I imagine it being moody, like. So there is some spotlights all over the bar. So we want to put some sort of box that diffuses that light instead of changing it for hanging lights. It's just going to be kind of like a diffuser that is going to make it like more moody. Mhm. That's one. And then there's a lamp in the by the window that is kind of like it's going to be a shrimp. That's gotta be really nice. And then I guess we haven't.

00:08:21 Alex: Wait, where do you find a shrimp lamp?

00:08:23 Tania: Yeah. Molly, Molly's friend is doing it. Yeah. From scratch.

00:08:28 Alex: Yeah.

00:08:29 Tania: Yeah. It's really nice.

00:08:29 Jenny: 3D printed or like she's like, sculpting it.

00:08:33 Carlos: Like.

00:08:34 Tania: Like paper.

00:08:35 Carlos: She's building like the structure by hand, and then she's gonna cover it. Mhm.

00:08:40 Tania: We saw a video already. Yeah.

00:08:41 Alex: Is it going to be hairy?

00:08:43 Tania: Yeah, exactly. Okay. Like with a mohawk.

00:08:46 Carlos: Yeah.

00:08:48 Alex: I love it. I love it.

00:08:49 Jenny: How big is this lamp?

00:08:50 Carlos: And I can show it to.

00:08:53 Tania: Probably like three feet. Mhm.

00:08:55 Jenny: Oh.

00:08:56 Tania: Yeah. Like like that.

00:08:58 Alex: Next team tattoo.

00:09:00 Tania: Yes.

00:09:00 Alex: For the mohawk. I love it, I love.

00:09:03 Carlos: It.

00:09:04 Tania: And then an awning on the front. Uh. What else? I think by the bar. We're gonna need some strip light, too. In the bottom. Mhm. That's gonna look nice.

00:09:16 Alex: Carlos is showing Jenny and I pictures of.

00:09:19 Jenny: Of the lamp.

00:09:20 Alex: The lamp. Oh, the frame of the lamp. Very cool. Look forward to seeing that. Have you guys started talking about. I know that you have done some, like, menu testing. Do you have a menu in place? Do you have like an outline? What's. Yeah. Tell me, what can you share? Is it secret?

00:09:40 Gio: No. We can talk about it, but, um, the menu has definitely switch from, uh, since we started talking about the project. I feel it has a lot of, um, it's really, it's kind of like made for people to, to be talking while, while they're eating. So it's like simple, it's like small plates. We didn't want to have like too big of complicated dishes. Um, I feel like we, when we were talking about this menu, Carlos and I, we were saying like, yeah, I mean, like something for like to be able to chit chat or like to catch up or, you know, being, being, being in a room where you don't realize that you already been there for two hours and maybe try six or seven different things. And we, we kind of want that to be the experience.

00:10:37 Alex: But do you want people to be there for two hours?

00:10:40 Gio: Yeah.

00:10:40 Alex: So I feel like we talked about.

00:10:42 Carlos: Yeah.

00:10:42 Alex: A faster turn before, right?

00:10:44 Gio: Yeah. So so I think there's the, the, the back sides of the space, which is more like an actual seating area, which I think we're going to be able to hold maybe twelve people over there might be a little more not sort of experience. And we're actually thinking on the bar to be like that a little more like fast, fast casual. At some point I even thought of like maybe not even putting stools, but I don't, I don't think we have decide anything on that yet.

00:11:16 Carlos: But it might be a part, right? Like we might hold the part that's just standing. You're just.

00:11:21 Gio: Yeah.

00:11:21 Alex: I like that.

00:11:22 Gio: Yeah. Just to kind of like quick and, um, but obviously, I mean, in terms of the menu shrimp, it's, um, you know, it's, it's the star of the menu. Um, if I remember correctly, we have like at least three or four different kinds of shrimp that it's, it's used for like different dishes. And besides that, it's like probably sixty, seventy percent, like small appetizers alike. And then there's a few really a few things that are a little more like invested in terms of like size and, um, but I mean, we can talk about some particular things on how it changed it, but like, we knew that we, it all started with an aguachile. That's how me and Carlos started to talk about this project. So our chili was the main centre for the, from the beginning of like every kind of like everything else that came after that. So we have a really good, uh, our Negro and Verde only shrimp. And, uh, it's, we don't, we don't use any, um, cucumber or like, it's just, it's just, it's just shrimp.

00:12:45 Alex: Like, because that's like normally like a filler.

00:12:47 Gio: Yeah yeah yeah yeah yeah. We don't love that.

00:12:51 Carlos: We love the shrimp. We just.

00:12:53 Alex: We just.

00:12:53 Carlos: We're just interested in shrimp.

00:12:56 Alex: Yeah. We're the shrimp. Love of shrimp comes from. Or why?

00:12:59 Carlos: I think we're looking for some Mexican shrimp right now. We're trying to see if we can bring some from Sinaloa. That's, like, the best kind to make a chili.

00:13:07 Alex: Okay.

00:13:08 Carlos: And it seems like we might have someone that might have it here.

00:13:14 Jenny: Traditionally, what actually is any fish to, like, tell us? Like what traditionally actually is and what your spin is on it.

00:13:21 Carlos: So you can do any fish. I think so. Uh, usually in Sinaloa, like that area of Mexico in the coasts northwest, uh, they do, it's like a spicy, it's like they cure either shrimp or scallops or fish. Uh, sometimes octopus too, I think. And they use it for some lemon. And then they make this salsa or like sauce that's very spicy. And they top it with that. After once the fish kind of break down with the lemon. And usually they serve with like onion and like cucumber. Um, they, one of the main ingredients is chili chiltepin. That's a specific kind of chili that's very small, but it's very spicy. So it's pretty much like a spicy liquid. That's why it's called aguachile. And yeah, I love it. I really think it's like we, we want our, our children to be spicy. That's, I think one thing we really have clear.

00:14:24 Alex: I can attest that the one at utility was hot. Yeah. Second day.

00:14:28 Gio: Yeah. Yeah. We won. We won the second one to be punished.

00:14:31 Alex: Yeah.

00:14:32 Carlos: I think we might gonna keep one more mile under one. We're gonna make it like.

00:14:37 Gio: Yeah, we'll have one a little. Not that crazy and one crazy.

00:14:40 Alex: Yeah, yeah. I saw a little side eye from that Keep one mild. We're on on board there. Yeah.

00:14:47 Carlos: We just want people to I think something I really feel like I'm missing in New York is like a spicy I want chili like yeah, so many so many of the Mexican food right now that's coming out is so mild and I get it. But like, that's not how it is in Mexico and Mexico, salsas are.

00:15:07 Alex: People are more receptive than we give them a chance for to sometimes I think like you've seen that with the unapologetic groups, restaurants that they have a lot of heat sometimes. But, um, but people still love it. It's, it's very people are adapt to it and learn. And that's what it is.

00:15:25 Jenny: High spice tolerance. I love it really spicy. Alex has had to pass me a few dishes in our time where he's like, I can't eat it. You have to eat it. Yes. Um, but will you be able to get the traditional pepper, the the small one or will you have to.

00:15:37 Gio: Yeah, yeah, yeah. That's easy actually. Now to find here in New York. Yeah.

00:15:41 Alex: Easier than the sinaloan shrimp.

00:15:43 Gio: Yeah. Oh. Why? You're here? Yes.

00:15:46 Jenny: What does this do for your food cost? Right. Because, like, seafood can be really expensive. And you're saying you just want to use shrimp. So like, obviously margins are really important. How are you thinking about food costs and costing out this this menu?

00:15:58 Gio: Sometimes it gets really challenging. We we wanted to have a shrimp from Spain called Carabinero. And, um, and we ended up deciding probably not to, or we might have it for like a small seasonal option, but for just one shrimp of that can cost like thirty five dollars to, to fifty. So that's, that's almost like impossible to cost in a restaurant because you're not going to sell it for one hundred and fifty or.

00:16:32 Carlos: For.

00:16:32 Gio: one.

00:16:33 Alex: West Village. You never know. I mean, it could be on the, uh.

00:16:36 Gio: Yeah.

00:16:36 Jenny: And the Hamptons people are buying eighty dollars pies.

00:16:38 Alex: In a little box on the top on the menu. Right. Or It's like something very expensive.

00:16:43 Gio: We, we. Yeah. That's something we gonna really have to think about. Like for now, that's really not part of the menu, but that's, that's really been like an extreme case, um, for the, you know, like on the most part, we, we try to source the products that we want is, uh, we don't want anything to be farmed. For example, we want everything to be wild. Um, there is the most simple shrimp that we have in the menu is the one that we use for the, um, uh, cocktail, the Cameroon, which is, which is just like the most basic, I would say, but even that one is, it's, it's wild. And that's the one we're also trying to bring from Mexico. And so we're, we're putting attention, but we're also trying to keep it realistic because we know we're in the West Village and we can probably, you know, charge for the product. But but we also want to have our friends over and be accessible for everybody.

00:17:45 Carlos: Yeah.

00:17:46 Jenny: How do you balance that with like educating the consumer too? Right. Because I think there's, you know, we've seen it this year, like the pushback on the forty dollars half rotisserie chicken and tacos are six dollars and they shouldn't be, but they should be. Right. So there's always this like push and pull. I feel, and like the cultural zeitgeist of what it is to be paying for, for food. And how do you educate people on it, especially when like Aguachile maybe isn't something that everybody is super familiar with.

00:18:14 Gio: I mean, I think it's, it's a little bit of both. Like maybe, yeah, it's a little bit of educating people, but it's, I feel like all, it all starts with like, what's the real origin of that people to try those things or like, what's, what's the, how much they really are willing to, to pay and give up for, to, to taste something like that. In terms of the, the example that I was in for the Carabinero. I don't know if I will spend one hundred and fifty dollars for one shrimp, but like, but I. But I try that shrimp in Spain many times and it's it's absolutely, it's an insane experience.

00:18:54 Jenny: It's the best shrimp you ever had in mind blowing.

00:18:57 Alex: Yeah. It's really expensive in Spain.

00:18:59 Gio: Um, it's still quite expensive, but not as much as probably over there.

00:19:03 Carlos: It's pretty expensive.

00:19:04 Gio: It's probably like one thirty, thirty five euros or things like that. But it's like so good.

00:19:08 Carlos: Yeah. It's crazy. It's like really.

00:19:12 Alex: Like you can't no description of like, why what's different is more intense flavors. It's softer. Is it.

00:19:18 Gio: It's, it's, it's a little sweeter. Like the taste is, is, is sweet, but it's, uh, especially the head. It's just, um, it's really profound and it's really creamy and, uh, it just tastes like, like the best expression of shrimp that you ever, you know, it's just like the flavor really literally explodes and, and everything, you know, the color, the size, it's, it's crazy. You want to eat everything.

00:19:47 Carlos: Like.

00:19:49 Gio: So that's the thing. Like if someone wants to, you know, like people, people don't necessarily want to be educated, but like, maybe just people wants to try things that they haven't tried before or, you know, and I feel like kind of like all stars there. So we'll see, we'll see what happens. I think we, some of the, the things that we are offering are very classic, like the aguachile or the shrimp cocktail. We have a tuna tostada. So those are really classic things. Um, but we're also doing other stuff that is not as classic. I would say we have a taco, the.

00:20:30 Carlos: Sardine.

00:20:31 Gio: Sardine taco that Carlos came up with. We have a something that it's classic, but in an unusual presentation that we have like a pinch of the Caesar salad. So it always comes on like, you know, a steak and other things that we, we are trying to really be playful with is the oysters. So we, we're trying to have some inspiration on, on cocktails, uh, like the micheladas or gin martini or a mezcal margarita, but in, in, in an oyster sort of expression. So that's something where like, you know, trying to go a little bit beyond like what's in any other place. And we, I mean, the camarones zarandeados we have, like those are really popular in Mexico, not as much as, as their, I mean, here, I don't, I don't think you can find it anywhere.

00:21:32 Jenny: Tell us what this dish is quickly.

00:21:34 Gio: This. Do you want to explain it? You do.

00:21:36 Carlos: You? Yeah. I mean, zarandeados are just they're really popular in the same area as actually like Culiacan area. And it's just like usually like grill shrimp, like they just cook it with like this sauce that's base of mayo with like chilies. So it's like a spicy red sauce and they sear it. It's delicious. So we're gonna do something like that. I feel like ours came out. I mean, we, the three of us loved the shrimp. And it's definitely, I don't know, anywhere in New York where you can get them. They're super traditional in Mexico. And I think that was one item that we really wanted to have on the menu because we loved them. And I think it came out also really, really good once we made it. Um, so I'm really excited to bring that.

00:22:26 Gio: Salsa has like some, uh, this combination with mayo and chilies and for me, like mayo and shrimp has, I mean, it always has been.

00:22:36 Jenny: Amatch made in Heaven.

00:22:37 Carlos: Yeah.

00:22:40 Jenny: At least he brought his hands together as like a marriage. A sign of marriage.

00:22:47 Alex: Wait, what about mayo on the, like, crazy, fancy Spanish shrimp? Is that a sacrilege or.

00:22:52 Carlos: Yeah, I know.

00:22:55 Alex: It's a fancy mayo for the fancy that.

00:22:57 Gio: Honestly, yes. I wouldn't put any mayo on that one.

00:22:59 Carlos: Keep it clean. Yeah. Even the way they cook it, it's just like olive oil and salt. They don't put anything.

00:23:04 Alex: I mean, why would you. Yeah. It's like putting sauce on caviar. Like, don't fuck with it, right?

00:23:09 Carlos: Yeah.

00:23:10 Gio: Oh, we also have caviar. Talking about caviar.

00:23:12 Carlos: And I mean, we have the sigalas. We have some langoustines. Yeah.

00:23:15 Alex: Sounds like a lot of cold dishes. Are you gonna use that?

00:23:18 Carlos: Fifty fifty? It's fifty percent of the menu's called. Fifty percent is hot.

00:23:22 Alex: So tell us more about the hot side and the cold. The cold side is running by the window, right?

00:23:26 Carlos: Mhm.

00:23:26 Alex: Yeah, yeah. It'll be prepped by the main kitchen, but there'll be somebody picking up on the bar side.

00:23:32 Carlos: Yeah, yeah. I mean, some other of the cool stuff we're doing is like we're going to do a caldito de camaron. It's like super traditional in Mexico. It's just like a shrimp broth or like a shrimp consommé. It's kind of really concentrate and usually a little bit spicy. Um, they serve it in many places in Mexico. You sit down as soon as you sit down, they'll serve it to you. And it's just like a shot or it can be a bowl, but like, I think we might just do the shot. Okay. Um, we're gonna do this dish that I personally grew up eating and love in Mexico City. It's called like filetto de pescado. It's just like a fried fish. It's just like, it's literally just a piece of mackerel and a beer batter. And you eat it with like, hot sauce and lemon.

00:24:20 Alex: A fillet or a whole fish.

00:24:22 Carlos: Uh, fillet. So it's just like a piece of fish, but like it's very in Mexico City, you can buy it in the markets, like really well, you're doing shopping, you can get one of those. And as a kid, I ate many of those. We're gonna have had shrimps. That's another hot dish. We'll just cook the heads with garlic. Olive oil.

00:24:41 Alex: Only heads.

00:24:41 Carlos: Only heads. That's like Giovanni's favorite part of the head. Big head. Yeah. We're gonna have some.

00:24:47 Alex: You eat the whole thing. It's not like a.

00:24:49 Gio: I mean, you don't eat the shell, right? But you suck it as hard as you. You know, you just, like, go in. Yeah.

00:24:56 Carlos: Squeeze it out.

00:24:57 Gio: Yeah.

00:24:58 Jenny: Are you gonna have a picture of how to do it?

00:25:00 Gio: Yeah, I mean that for sure. We're gonna have to. Yeah. Tell people I don't know how, if it's really in a picture, but yeah, we're gonna.

00:25:08 Jenny: I don't know why. I'm like, imagining.

00:25:10 Carlos: Like a.

00:25:11 Alex: YouTube video. Yeah.

00:25:12 Carlos: Yeah.

00:25:12 Jenny: You know, like the silly, like choking posters that people now have. Yeah. It's like I'm like envisioning.

00:25:17 Tania: We did a silly one.

00:25:18 Jenny: Oh you did?

00:25:22 Tania: Yeah. But yeah, I think.

00:25:23 Tania: Obviously all of that will have to be like social media videos and stuff like that. Things that people need a little more education with.

00:25:32 Carlos: And I mean, I think also comes with the training for the people at the bar. Like they're gonna need.

00:25:37 Tania: To.

00:25:38 Carlos: Know how to describe and explain customers what it is and how to eat it.

00:25:43 Alex: And everything is seafood. Are there, are there, are you going to throw something on for the bro that wants a piece of meat or a vegetarians or something like that?

00:25:54 Carlos: Well, we have some options.

00:25:56 Gio: We do have, um, we have two salads.

00:26:00 Carlos: We have olives.

00:26:01 Gio: We have olives. And that's It.

00:26:06 Carlos: And I think that's pretty much it.

00:26:08 Gio: That's it.

00:26:08 Tania: I think like the Ramirez brand is not very vegetarian friendly anyway, you know.

00:26:14 Carlos: Yeah.

00:26:15 Alex: Speaking of Ramirez brand, are there you mentioned the sardine taco. Any other tacos that will bring people back to.

00:26:22 Gio: Yeah.

00:26:23 Carlos: We're we're gonna do a taco Gobernador. That's very classic from the Ensenada or from from the Baja side. More on the north side near Ensenada. It's a taco of like shrimp with beans and cheese on a corn tortilla. It's super good.

00:26:41 Carlos: Yeah.

00:26:42 Tania: I love that.

00:26:43 Carlos: Yeah yeah.

00:26:44 Jenny: Yeah. And that's probably your best food cost to know.

00:26:47 Carlos: Mhm.

00:26:48 Tania: There is a it's not a taco, but the pescadito.

00:26:52 Carlos: Yeah.

00:26:53 Tania: Oh, yeah. You already took the mackerel. Yeah. That's so good too.

00:26:58 Gio: We have the carpaccio.

00:26:59 Carlos: Oh, yeah. We have.

00:27:00 Gio: A.

00:27:01 Carlos: Carpaccio de gambas.

00:27:02 Gio: Like caviar.

00:27:04 Carlos: Shrimp. Like more a Spanish version of, like, uh, shrimp carpaccio. It's very classic there. They just put olive oil and a little bit of caviar. Always make it better, to be honest.

[AD BREAK]

00:27:20 Alex VO: Last season, we watched Rasheeda build Ramen by Ra around two very different experiences an intimate chef's counter and a fast moving takeout window. Square helps her manage both while also connecting online orders, in-person sales, merchandise and guest information. That means Rasheeda can recognize the customer who ordered ramen last week and bought a shirt two weeks ago. It's tech helping a small business feel even more personal. The Build is presented by Square. Learn more at square.com.

00:27:51 Jenny: What's running in my mind is like, this is all new purveyors and things for you to write, because you're obviously very different menu than what you have at the other two locations or other three locations.

00:28:00 Alex: We just need a really good shrimp guy.

00:28:03 Carlos: Yeah.

00:28:04 Jenny: Yeah. So how are you thinking about and you mentioned you wanted to do mostly wild seafood. So how are you thinking about sourcing and, and have you found all your.

00:28:14 Gio: We're still working on some of them, but, um, uh, Carlos just, um, he's working on a new connection from product that is, is coming from Mexico. And we also have a family member that it's, uh, it's, he can help us on that. But the problem we've been having at that at this level as of now is that the volume, like for someone to sort of like bring something from Mexico, it needs to be like, we need to talk about like a pallet trailer.

00:28:47 Carlos: Oh, wow.

00:28:48 Gio: So we need to probably find other people who will be interested in, in using that product, or maybe Aquafish, who is also a friend of Carlos. We, we want to talk to them and see if there will be interested in managing like.

00:29:03 Carlos: Pretty much seafood purveyor.

00:29:04 Gio: Yeah.

00:29:05 Carlos: Yeah.

00:29:06 Jenny: And that's like the one in Chinatown.

00:29:07 Carlos: Yeah.

00:29:09 Gio: So that we've been talking a little bit with, um, some, um, oysters that we actually met at, uh uTILITy.

00:29:17 Carlos: At uTILITy Island Creek. Yeah.

00:29:20 Jenny: I love a uTILITy meet cute!

00:29:21 Carlos: Great. Yeah. Yeah.

00:29:23 Gio: So we've been talking to them, too. uh, I think it is not going to be like one source for sure. It's just we're just going to have to like spread.

00:29:32 Carlos: It's definitely going to be a few different because I feel like we're picking things from like each provider, whatever makes sense. What.

00:29:39 Alex: What you want. Yeah.

00:29:39 Carlos: Mhm. Yeah. And I think also we've been lucky because, I mean, there are two providers I'm talking to right now. They came just through like they just demo presently.

00:29:49 Gio: Yeah.

00:29:50 Carlos: And one also is the one has the langoustines we need in a really good price. Oh yeah. They're just kind of like coming up to us to offer us seafood. So it's been not too hard.

00:30:05 Gio: And maybe shrimp and fish.

00:30:07 Carlos: Yeah. We'll see. I mean, I, we love shrimp and fish. They're really close friends, but I don't even know if they have what we are looking for, but they might. We'll see.

00:30:20 Jenny: Are you worried about setting up new vendors, maybe who are not tried and trusted and then having supply chain issues since you have such a specific menu. Or is that something you're just going to roll with it? Sorry, Tanya.

00:30:32 Tania: Like things I never thought about. And no, I don't. No, I don't think so.

00:30:43 Jenny: I'll figure it out.

00:30:44 Tania: Yeah yeah yeah. I think it's just a matter of like you're saying, having options to like, if this person doesn't have this specific, I think we got to be flexible enough to work with someone else for that product. Maybe it's not the price that we want to pay, but if it's an emergency like that. Yeah, I think it's fine.

00:31:07 Alex: Are there any takeaways from Ramirez or Socceria that help inform how you're getting your food and how you're prepping and storing and all those things?

00:31:18 Gio: Yeah, I think we're, we're, we're just figuring everything out from, you know, not having much reference from from that.

00:31:27 Carlos: To me feels very similar to the idea. I mean, that idea, if you go every morning, they're prepping every single day what they're gonna use that day. The pastor is prep one day, like the guy that makes the Trump Paul pastor preps their own pastor. So it's like, it's everything very like fresh and very like the space is so small that they, the product gets there kind of almost every day. So I, the way I'm seeing this, just because it's seafood on the coast of it, I think we're going to be receiving products most days and we're going to be working those products.

00:32:03 Alex: Most shrimp is coming in frozen, right? It's getting frozen on the boat when it's um.

00:32:07 Carlos: Yeah, I think yeah, yeah.

00:32:09 Alex: Do you have storage in the basement? I don't, I don't remember.

00:32:11 Carlos: We do, we do. Yeah. We, we have like a good amount of storage in basement and prep area. Yeah. So that should help.

00:32:20 Jenny: How do you think about menu laddering up to like average guest check size and your overall financial model.

00:32:27 Carlos: Um.

00:32:28 Gio: We… so the experience will have to. The wine is an essential part of the menu as well. And I feel like considering food and beverage, uh, it will be close to one hundred per head around that number. That's, that's how we projected it to be.

00:32:46 Alex: How much of that's food versus alcohol?

00:32:49 Gio: Probably. Pretty equal. I would say.

00:32:53 Jenny: fifty fifty.

00:32:54 Gio: Yeah. Yeah. I think also the sort of experience that we were thinking about, like, unless it's something like a really a quick bite, but even, even, even in that sense, like if it's like one or two dishes in a glass of wine, it will still probably, it will probably go more towards the food. But if you spend more time and you know you're doing this chit chat thing, it will probably be fifty fifty.

00:33:21 Carlos: Because I mean, we're, we're also like really working hard also on the wine side, but we have our wine, like we have a person just dedicated to source the wine and like milk make the menu as our friend Carlos or Carlos. Um, um, we, I think the wine work and we've been sourcing wine since the beginning of the year. We already have like a sourcing.

00:33:47 Alex: You mean.

00:33:48 Carlos: Like just.

00:33:49 Alex: Like tasting wine?

00:33:49 Carlos: Yeah. We've been drinking wine.

00:33:52 Alex: Sourcing wine all year.

00:33:54 Jenny: Six months of hard hitting research.

00:33:56 Alex: I love it.

00:33:57 Carlos: Well, it’s all the cool wines. They come in very small quantities to New York, so you need to pick like, if you are lucky, you get two cases of the wine you want, right?

00:34:06 Carlos: Mhm.

00:34:07 Alex: So you have a very specific list or a big list or both.

00:34:11 Carlos: I think it's going to be both of them. It's very specific. And it's, it might be, it's going to be like we have wines from everywhere so far And they're all very, like, unique.

00:34:22 Alex: And what about that storage situation?

00:34:25 Carlos: We have already like seventy cases of wine there.

00:34:28 Gio: We have good storage. That's a good part. Yeah. And I think the wine program will be more about like really keeping things rotating. Yeah. And not necessarily buying the same wine, you know, like we want Carlos in that sense. He has a, he has a good amount of work just because he basically needs to make new orders every week for wine.

00:34:50 Alex: And this Carlos is working as a contractor with you guys or he's a full time employee.

00:34:55 Gio: He's going to be a full time employee. Right now, he's like freelancing because we're not open yet. But but once we're open, he'll be pouring the wine there.

00:35:04 Carlos: Yeah.

00:35:05 Jenny: To customers to be like service director and some or beverage director.

00:35:09 Carlos: Yeah. Yeah.

00:35:12 Jenny: Cool.

00:35:13 Gio: Cool wines.

00:35:13 Carlos: Really cool wines. And it will be just like. I mean, every time you come, you're gonna have to try a different one because we don't have a lot of them.

00:35:20 Alex: The wine will change. Will the will the food menu change also?

00:35:22 Carlos: No, I don't think we're thinking. I mean, I think for the menu, we have thought about maybe having some things that are going to be specials and we might have sometimes. Uh, but I think the menu, we're trying to keep it like.

00:35:33 Gio: Yeah, steady.

00:35:34 Carlos: As you see it. Yeah.

00:35:36 Alex: I want, I want to practice dishes.

00:35:38 Carlos: Yeah.

00:35:39 Alex: I don't want these, uh, your experiment from yesterday. I want something you guys have worked on. You know what I mean?

00:35:45 Carlos: Yeah.

00:35:46 Alex: That's how I look at it. It's like I want something that's been tested.

00:35:49 Gio: And we want people to crave for for what we're doing.

00:35:53 Alex: Yeah. And you want to come back and get that. I think for the cooks in the kitchen, it's a little better, less stressful that you're not going in every Monday and you have to like create something brand new, learn how to make it. Chefs, you know, have to teach it every week.

00:36:06 Carlos: Yeah.

00:36:07 Alex: I think there's a lot of asset to that, but that's my own personal stuff.

00:36:12 Alex VO: Now we're all hungry. But before you go satisfy your cravings, listen in as we chat with Lauren Fernandez about some key learnings of growing and operating a multi-unit restaurant group.

00:36:21 Jenny: Okay. All right. Well, I'm excited to chat with you, Lauren investor founder, all things restaurant growth guru. Um, so I'm curious to hear from your perspective, what are the biggest watch outs for founders? Um, from both like a financial perspective and an operational standpoint who are going from, you know, rapid expansion starting at three restaurants and getting to five by the end of one year.

00:36:46 Lauren: Yeah. So the number one concern is always going to be operations, right? Because in a perfect world, all the money and time and perfect locations are there for scale. And there's plenty of market demand, which I think are all things we can discuss shortly. But I always look at the operations first. And in this economy, especially right now, there's very little margin for error on restaurants as they used to exist. There was plenty of buffer and food costs. We really enjoyed lower labor costs than was historically normal compared to other industries. But post Covid, we've seen a lot of adjustment up on those food costs, those paper costs because of third party and a lot more delivery and off premises consumption, and of course, an adjustment up on labor significantly. It just doesn't leave a lot of room for wiggle and the profit margin of a business. The danger is when you are on it and you are the new kid on the block and you are enjoying accolades. And in all of the buzz, the sales are there and higher sales can cover a number of those unit level economic sins. And what I see happen is the popularity of a brand. The demand for the brand and its general goodwill will generate a lot of sales for a significant amount of time, as long as you're able to maintain standards. And that's fairly straightforward to do from units one to three. Because if you picture yourself as an owner operator, you're kind of like an octopus, right? Like you have a hand on everything and you've got really solid number twos, maybe in your kitchen, maybe in your front of house, a good sort of team that you can rely on that doesn't need to be copied and pasted like repeatedly into each location. So you can wear a lot of hats, so to speak, and cover many different aspects of these businesses from one to three. But when you start going to four or five, six, there become gaps. And the systems and the processes that, you know, just because you do them as an owner operator and you know, that's your standard don't exist unless you're in The Building or someone you trust and is trained directly is in that building behind you. And that is a piece of scalability that is necessary for repetition beyond unit three. And I tell people all the time, if you had to go on vacation for a week and leave the business, who would run it and how do they know what to do? And the best advice I can give to any operator who's looking to scale beyond unit three is to challenge yourself to take not just one week off, but two weeks off from your business and see what breaks while you're gone. Those are the things that you should tackle first as processes and procedures, and if necessary, the people hires to make sure that the business can run smoothly at scale. As I could sit here and tell you, oh, it's an open to closed checklist and close to open checklist. And it's training your managers this way. And it's a front of house that looks like this. There are a myriad of restaurant consultants who do that work, and it's the Lord's work, so to speak, like it's the hard stuff, right? But the simple test is, can you leave it? Can you leave the baby in someone else is capable hands. And how do they know what to do? And if they were irreplaceable, what would you do then? Right? Like really having a thoughtful analysis of what it takes for the business to run smoothly from a financial perspective, when you tighten on your unit level economics, because I think a lot of operators see success by the number that's in the bank account, especially in units one through three. But if you ask them what's their profit margin, they can't answer the question. They just know that they're comfortably making payroll. The rent's not a concern. And there's so much demand. They have too many covers. You know, let's open another location. But actually, fact checking on those costs, like the theoretical cost of a plate, the actual cost of a particular menu item, what it takes to operate that restaurant, and what it means for another location to take on that operating model are all questions I think, that require a certain level. And I say this in the loving way, nerdiness and love of Excel spreadsheets.

00:41:21 Jenny: I always say freak in the sheets. We have to be freaks in the sheets. Yes. And the spreadsheets.

00:41:25 Lauren: It's taking that data from your point of sale, taking the information that you have from a chef perspective and building a plate and really, truly understanding the cost to take in those raw, you know, inputs, right? The inventory, convert them with the talent on hand and produce them to public within appropriate profit margin built into your pricing that ultimately contribute to that bottom line profitability. And I see successful restaurants all the time. I actually saw one just last week that was operating well north of five million dollars and a twenty percent profitability, but they were leaving at least ten points on the table. Wow. And when you think about what ten points is on a five million dollar plus AUV, that's a lot of money to be leaving on the table that could fund your next location. And so to most restaurants that are thinking of scale, even if you've done it well in unit one and two and three, do you know your profit margin? Do you know the break even number for that location? You've done the math on the labor and the rent and all the other add ons that. So, you know, you need to make X million dollars a year before you turn a profit. These are alarming questions as an investor that I find that many early stage entrepreneurs can't answer. And it's not hard if you have solid restaurant level accounting, a knowledge of your core numbers and how they work with each other, which is really fundamental to what we call unit level economics in a restaurant.

00:43:03 Jenny: Mhm. Do you do you recommend that people run completely separate panels for every single location. And because you're right, like, yeah, and I think so many people are exactly the.

00:43:14 Lauren: The P and L. And I tell people this all the time, I have a business degree and took, you know, graduate level accounting. And I didn't, I, I sat inside businesses that had millions of dollars on their PNL. I had budgets that were millions of dollars, but I truly did not understand every line item on a piano until I had to run a failing restaurant. And what I learned, very simply put, was your sales at the top of that PNL is the driver of your success, but managing every cost on that profit and loss statement down to your net income or your EBITDA, however you want to look at that is mission critical to running a profitable restaurant. That is where your knowledge of how the business works in operations meets the finance piece. And I can't state this enough. Finance helps you understand how all of these pieces come together to make money, and it helps you look forward into the future about how you can make projections and better manage your inventory and forecast and all those great things. But the accounting is so critical to this because if you have garbage accounting, you're going to end up trying to do garbage forecasting. Like it just, you know, they love this expression and accounting world. It's like garbage in, garbage out. And so I tell people all the time, the numbers have to be sacred, consistent, and identically treated between each location. If oil is a certain cost center in one location on a PNL, the oil needs to be the same cost center on the next PNL. So you can go apples to apples across your units. And I find that this isn't magic. It's just a standard restaurant chart of accounts that's managed by someone who has a deep understanding of restaurant accounting, Period. And that is the basis for really understanding the financial health of a restaurant and also where to go apply fixes. You know, you see something that's out of line and it gets a flag to understand. Again, connecting that financial result to an operational cause is really, really important. So it's not a big leap, but I find that many restaurant owners are so scared of the numbers and they shouldn't be. They're your friend. They are the early warning signal, the smoke, if you will, of an impending fire somewhere in the business, whether it's theft or shrinkage or inventory mismanagement, whatever the cause of the loss may be, the name of the game isn't just building sales, it's protecting against inappropriate or inexcusable losses that impact your profit margin.

00:45:57 Jenny: Mhm. Yeah. No margins, obviously everything. And controlling opex and inventory costs and and all of those things is what we, we live and die on EBITDA. right? Which is so true when you're scaling what, um, you know, the other thing that's happening this season with, um, the team as they're scaling is that they're, they're funding the restaurant mainly themselves. So, and I know this is common, you know, with themselves and some like family style investors. So, you know, capital isn't infinite. So what are some of the pieces for them to watch out for as they're thinking about how the best ways are to deploy capital in this environment?

00:46:34 Lauren: So I am a huge fan of understanding and being on site during construction. The only way I know to control any sort of cost overruns on construction is to be visible and painfully so on site as much as possible. And that does take up a lot of time. And that was my job for many years while we were building multiple sites at once. I fortunately was in a franchise situation, so there was a little bit of a copy paste repeat, so I did not have to spend a ton of time worrying about process and procedure, just that they were being followed. And that to the extent that we developed any additional processes or procedures that those were implemented well. So I, I really had a heavy reliance on my general managers that were authorized, if not deputized, to act as the mayor of their restaurant. They were financially incentivized to make sure that their financial performance and their operations performance were in line with our expectations. That allowed me to really focus on development, and that was really critical for our success at some point. I think it was around unit nine ish. We did hire a director of operations to be an intermediary between me as the owner operator and our many gems, and that was appropriate. But for me, I really had to focus on those builds and keeping them on budget, because that is one of the things that I spot most often is you have a number of different subcontractors. They're trying to get the job done. Left hand's not talking to right. And someone might have a cost overrun or a time delay that impacts the entire schedule. So there was a lot of creative problem solving, a lot of asking why questions, trying to, without being obnoxious to the contractor, insert myself to help solve problems wherever possible. And I did you know, whether it was a landlord issue a neighbor issue issues with water supply, electrical like I man, I was, I was like, little miss fix it. And I'm not even terribly handy. I was just trying to be a facilitator of that project. And I would say that cost overruns and construction are kind of the number one concern. I'm also going to say something that may sound a little bit unpopular, but lots of times everybody wants brand new equipment, and there is sometimes some value in those warranties and having the new shiny widget. But there are just certain pieces of equipment and I will die on this hill that do not need to be new. If there is a vent hood already in a location, please try and figure out how to work with that. Like if there is already a fire suppression system, you really have to deeply understand what the cost is of removal and replacement on some of these key features, walk in coolers, etc. you know, really understand what you're stepping into. And if it's a second generation space, I see people make this mistake all the time. They'll go in and think they're going to save a ton of money, and then they start going, but what if we just move this two feet? You move a wall and all of a sudden it's a can of worms. It's not up to code. Like it's just a nightmare. So I, I, I am a big fan of work with what you've got and really try to optimize the spend on the F and E in the restaurant and put it where it counts. And don't think that you're going to, you're not going to make that money back, right? Like it doesn't matter. So, you know, could you improve it six months down the road when the restaurant is wildly successful? Yeah, sure. Do it then. But just getting the door open and getting it open quickly, especially after you've signed a lease, is mission critical. With respect to financing, I love a self-financed project, especially in this economy where the cost of lending really the cost of any capital is approaching a more historical average somewhere around eight to eight and a half percent. And if you have the cash flow and you're willing to reinvest in yourself, I think as an owner operator, that's a great idea. But it it doesn't need to come at the cost of stress or sacrifice to other units or to hiring the appropriate employees at the right time. One thing to remember is if you've got cash sitting in, in, in an account ready to deploy on a project, many banks will loan against that at a lower, more favorable rate, especially if it's secured by real estate. Um, so you can look at some kind of bank financing, a construction loan that will just give you some added liquidity to get the project done quickly. So you're not slowing the opening down because of cash concerns. And so in that situation, I would seriously consider, for example, a revolving line of credit that's secured by some other capital that would allow them just the freedom to breathe, to get the project done in a quick fashion. In many cases, banks will work with you. And when that line of credit is exhausted or done with a project, they will allow you to either pay it back at that time or over a three month period, for example, or take a slightly longer term, like twelve months to two years, and it's at a fixed interest rate, and you just pay it back directly out of the proceeds from that unit. And it's just a safer way to ensure that you're getting the doors open on time, because really, that's what's mission critical. You want that thing open as soon as possible and making money.

00:52:07 Jenny: Yeah, I think that's something that it's really helpful for our listeners because I think that people just don't even think about asking for debt when they have cash on hand. But the best time to ask for money from a bank and a loan is when you don't need it necessarily where it's. We always try to say like, ask for the money when you don't need it immediately, or if maybe you do, but you still have cash. And when you talk about the assets being backed, you're. It's not just a lease you're referring to. People have to have like owned assets that they can just for the clarity of our listeners.

00:52:36 Lauren: Yeah. So in most, let's, let's just use the SBA loans as an easy example on a lot of those. What secures the loan is the furniture, fixtures and equipment inside the leased space. If you have the dirt, if you own the dirt, it's a completely different ball game. That is a much different, easier loan to acquire. But most people have a lease. So what will happen, and this is pretty typical in an SBA situation, is they do an analysis on how much of furniture, fixtures and equipment are on hand that is secured by a lien. And then whatever the air gap is between the value of that F and E, and the total value of the note is usually secured by a personal guarantee. And that can be dangerous for a lot of restaurateurs. I generally advise against signing a personal guarantee. If you can, you can ever just put the notes in the name of the business or the LLC that is preferred, and in most situations you can secure construction financing for the LLC. And it's exactly the way that I have mentioned. You put it in the name of the business. It's secured by the F, F, and E, which is a physical, tangible asset that can be leaned against. But also you pledge some cash to the deal. So sometimes it's ten percent, sometimes it's more. But I find that local banks are more likely to play in this situation local to regional. And especially like you mentioned, like having the cash on hand really, really helps. Or having some other collateral that you're willing to pledge safely. So the danger with a personal guarantee is it reaches all of your assets. And the last thing you want in a restaurant situation, when you're going from unit one to two to three, is to have cross collateralization between the units. You want to try to insulate the risk into each individual location. And maybe this is a little bit of the lawyer in me talking here, but it's a smart play, right? You're going to the bank and you're saying, look, I'm willing to put up X and the bank's like, great, because we only need half a million to loan you two. And you're like, okay, great, here's X, Y, and Z. I'm going to pledge as collateral. And you know what you're exposing to risk, even if it does engage the other restaurants to some extent, It's not, you know that dangerous. It's a little bit more mitigated, shall we say?

00:55:02 Jenny: No. And this is super helpful because it's like it is in the weeds on how you can deploy capital and help protect yourself. At what point do you think people do need to seek outside capital, right when they're scaling and growing? Like what's a good barometer test?

00:55:17 Lauren: So when you are self-funding and you think to yourself, yes, I can do this on cash, we have a great plan. I think you always have to plan for the unexpected, in my opinion. And this was just how I handled it. As an operator, we were rapidly building new locations, so the draw on cash far exceeded even our best forecasts for what our existing units were throwing off. We were also trying to build a catering business at the same time, so having a revolving line of construction credit was critical just to keeping the flow of funds moving on as many as four concurrent construction projects at a time. So from our perspective, I treated the existing business and its stable operations as mission critical first. So we put about three months of what we know we knew we needed as buffer for operations, just not to have it sitting there in account, but just as a constant ability to have cash cushion and be drawn down all the time just to operate the business. And then we separately sequestered funds for construction. We used that capital plus a line of credit to basically deploy a mix of debt and cash on hand to fund our rapid growth cycle, and that's how we managed it. It also led us equally and equitably distribute the debt that we put down on each unit to be even and fair. And one of the reasons we did that was because we had multiple investors involved. We had payback periods. You know, there was obviously a denigration to profit sharing for partners and investors while we were aggressively paying down debt. So we just had an agenda to make sure that we weren't overburdening one location as compared to another. So number one, prioritize the existing business operations and do not short the existing business operations on cash. To the extent that there's additional cash available for development, separate, segregate those funds and when available, if it's enough and you have a whole basket for the entire amount. Great. But if you are short in any way, shape, or form, I would highly recommend padding that with available debt, not debt that you have to use or that you're taking out and paying interest on immediately, but a line of credit that you can draw down on.

00:57:43 Jenny: I think that's really helpful. And I think this is something that we're seeing happen within this episode, is that they're funding. They're using proceeds from other locations in order to fund The Build out of location number four. Currently, and to my knowledge, they don't have a line of credit. So I definitely think this is good advice and a good time for them to go and get one of those line of credits, especially with episode five. Episode five, I'm thinking, I'm thinking of the podcast, especially with location number five on the horizon. Um, you said something interesting before about, you know, construction overrun versus timeline and for opening because people are, you start paying rent. So how do you balance that piece of the budget when you're thinking about, hey, do I just pay a little bit more to get it open faster? Or do we just wait until everything's ready and let construction go a little longer? That's something we're seeing right now too.

00:58:38 Lauren: So I always had a set open date and I, every Monday morning I had, and I still have this, like I use it all the time with clients, probably. I don't even know how many pages deep this Excel spreadsheet is, but it's literally everything you need to think of when you're opening a restaurant and it's a T minus. So you put the grand opening date in the front. I built this myself because like it didn't exist. And it's from, you know, all the way from six months out to opening to the day you open and then what happens after. So I knew at any given moment how off schedule we were for opening and whether or not more money thrown at it would actually impact opening. From my perspective, if you're looking now, this all goes back down to your lease, right? So if you have a lease that has language in it that says you start paying rent at the later of your certificate of occupancy or your grand opening, you're, you're golden that those are terms that in a lease that I saw all the time because I signed leases in a lessee friendly market. It was not in favor of the landlords. It was in favor of the tenant. Right? Not so much in this economy. What we are seeing right now is terms that are like, you will start paying rent in three months. You are signing today, you will pay in three months. And I would say in those instances, it's like having a gun to your head. It's extremely stressful. I've never known construction to run early. It always runs late and over budget, and I'm sorry if that offends some contractors out there, but it's just facts. It's just what happens. I'm, you know, show me one restaurant.

01:00:21 Jenny: Yeah. Caller like, audience, tell us. I mean, I legitimately.

01:00:26 Lauren: I, I, I have gone so far as to offer a cash bonus to contractors who can deliver early. And they always go, oh my God, you can see the sparkle in their eye. And then it never happens because I know, I just know, and it's sometimes it's not their fault. It just happens. Like, you know, we owe the fire inspectors on vacation in Aruba for two weeks. And so you can't have your CEO. And I just see a contractor looking like his head's going to pop off, you know? So I number one is always budget. Like it's going to be late, always budget, like it's going to be at least ten percent to fifteen percent over. And I know that scares people, but you should plan for that. And I think three, it's a time value of money equation. Like if you know, you can get it faster and it's going to start making you money, especially if you're already paying rent, then that math needs to be done. Like that equation needs to be run on, even if on the back of a napkin. I've had very few situations where I've been like, you know what? It's just worth it. We're gonna, we're gonna throw the money at it. Instead, I have come up with weird solutions like I opened without a sign one time. We just had to have a banner that was all we had, and it was awful. And it was a permitting issue that we could not avoid, and it just was what it was. And so yeah, it was low key, tacky, but we had to open, we did a soft open with a banner and it got it done.

01:01:47 Alex VO: Some amazing advice from Lauren Fernandez here, including how to sidestep a last minute signage issue. Now you're free to answer your hunger pains from our earlier menu chat with the Peludo team.

01:01:57 Jenny VO: Next time on The Build: Restaurant 201, join us as we chat about building the team while growing your restaurant group.

[CREDITS MUSIC]

01:02:07 Jenny VO: The Build is produced by me, Jenny Goodman, along with Alex McCrery and Sam Gerardi. Our audio engineer for this episode is Sam Gerardi. The show is produced in partnership with Square. You can learn more at Square.com. Be sure to subscribe to The Build wherever you listen to podcasts, and follow along @TilitNYC for special behind the scenes moments and more from the show.

01:02:27 Alex VO: The Build is presented by Square. Supporting restaurant owners and small businesses with the tools they need to start, run and grow. To learn more, visit square.com. And we'll see you next time on The Build.

[CREDITS FADE]