Tip:
Highlight text to annotate it
X
I'm Keith Simpson and I'm a restaurant expert.
I've been a chef, a caterer, a successful restaurant owner,
and now I'm one of the top
restaurant brokers in the country.
You've got all the space that you need
for your Mom and Pop café, which is your dream.
After 30 years of running restaurants,
now my passion is helping other people find theirs.
Here we are -- the nerve center, the kitchen.
I've closed millions of dollars in restaurant deals,
and I absolutely love it.
First-time buyers, they're the toughest.
Feels like we're gonna be bumping into each other.
But there's nothing I'd rather do.
We've got to do undercover 'cause this is
a highly, highly confidential listing.
Today, I'm helping sisters Kelly and Lisa
realize their dream of owning a small American café,
and they're risking everything to do it.
So, you really think that we can do
all of this within our budget?
Well, I want to show you my ideas and my plan
of what we're gonna do in the restaurant.
I'm showing them three spaces, but only one will hit the mark.
If you're ready to buy a restaurant, I'm your man.
-- Captions by VITAC --
Closed Captions provided by Scripps Networks, LLC.
I'm here in Minneapolis, Minnesota,
about to meet Kelly and Lisa.
They're first-time buyers, and they're about to risk everything.
I'm here to help them, so, hey, the pressure's really on.
Lisa and I are sisters.
I'm older.
Right. I'm taller.
The closest thing we've ever done to opening a restaurant
was probably 30 years ago, a lemonade stand, do you think?
You can own your own restaurant
with not a lot of funds and not a lot of experience.
It is part of the American dream to be your own boss.
The idea sparked for Kelly
after a tragic event in her life.
My husband was killed in a car accident by a drunk driver.
After my husband passed away, I just had this real sense
of...wanting to create something
so that people would realize
just how precious every day is in your life
and have a place that you could go
and just spend time with one another
and celebrate life, really.
I know this is highly emotional for Kelly
and I take it personally and I want to ensure
that they get the right place.
They're looking for a cozy café where they can serve
homemade sandwiches, soups, and great coffees.
Really, what's on the line here
is the whole vision that I have for my future, really.
This is Kelly's dream.
She's risking her money.
But her sister, Lisa, is going to be
by her side every step of the way.
My budget's $300,000, and that is it.
I mean, I have to be all-in at that number,
not a penny more.
$300,000 is a lot of money.
That's a lot of pressure on me, I think,
to help her make the right decision.
But I think we're gonna get there.
This first restaurant I'm taking Kelly and Lisa to
is called the Cottagewood General Store.
It's about 20 minutes outside of the city.
This, I think, fits all of their criteria.
From the Mom and Pop charm to the simple menu,
this turn-key general store has it all --
including the support of the surrounding community.
This is so cute!
Look at that. Oh, I love the porch.
LISA: Hi.
Good to see you.
Good to see you.
Great to see you.
So, what's your first impression of this?
It looks like you plucked it out of a storybook, honestly.
Well, I did, and I thought it would make
the perfect starter restaurant for you.
Sometimes purchasing a restaurant,
you are only buying the business,
not the real estate.
In fact, more often than not,
you are only buying the business.
You have a $300,000 budget.
Now, this is only $100,000.
The rent here is only $1,000 a month.
This is a great price.
They'll have ample working capital,
and I will make sure they don't overextend themselves.
And what kind of numbers are they doing?
They're doing about $20,000 a month
open from May to October.
Just May to October.
I have good ideas. We could expand that.
[ Chuckling ] Nice. Okay.
Come on. Let's have a look.
[ Chuckles ]
LISA: Oh, look at this.
Nice job, Keith.
The moment I walked in the door,
it's like that picture I've had in my mind.
It's just adorable.
I love this vintage case.
You do?
Yes.
That was one of the first things I wanted to go, but okay.
Really?
That's all right.
Kelly and Lisa seemed really delighted with the charm
and the Mom and Pop feel of this restaurant.
But in order to make money,
they've got to make some renovations and some changes,
like the vintage case Kelly loves.
I see that as being two four-top tables.
Oh.
You see?
You take that away, and you've got more revenue coming in.
KELLY: Oh, this is so cute.
SIMPSON: It's lovely.
You know, it reminds me of an old English garden.
Right now, they're closing at 7:00.
We could go on.
I really think you can do something more in the evening.
And you're gonna double this business.
Kelly and Lisa are gonna have to market
outside of this neighborhood.
They can do so with quality and good service.
Laurie, hi, how are you?
Good.
Nice to see you.
Welcome to Cottonwood store.
I always advise buyers
to talk to the sellers as much as possible.
With Kelly and Lisa,
I really want them to know what they're getting into.
SIMPSON: How long have you had the business?
I've been here for nine years.
So, it's been nine good years for you, has it?
It has, and I love it. I love this place.
I love the people. I just need a change.
And I'm gonna move to Colorado.
Wow.
That's exciting.
I understand you have a kitchen back there.
We do, and we don't utilize our kitchen.
We do everything right here.
SIMPSON: And by everything, she means sandwiches and that's it.
If Kelly and Lisa want to expand the menu,
they'll need a decent space to prep and cook.
I'm a little bit worried about the size of it.
It feels like we're gonna be bumping into each other.
You know, you want a small kitchen.
You're paying rent. You're paying per square foot.
You need the smaller kitchen
and as much space outside as possible.
Well, I want to show you my ideas
and my plan of what we're gonna do in the restaurant.
SIMPSON: This dining room is a great start
for their must-have -- a cozy Mom and Pop-style atmosphere.
But we'll need to make room for more seating,
so we'll remove the shelving, cabinets, cases, and counters.
And the merchandise can be condensed into one cabinet.
We'll keep the beadboard ceiling,
old-fashioned lighting, and extend the hardwood floor.
We'll add a barista station with seating
and a register for take-out orders.
And then add more tables and a few soft chairs
to round out the seating for 45,
including a cozy booth by the front window.
And that window table's gonna be
one of the best tables in the house.
KELLY: It is.
Love it.
With an estimated renovation cost of $25,000,
Kelly and Lisa are looking at $137,000 all-in
for the first year, leaving them just over $160,000
for start-up costs and working capital.
By adding more seating, extending their opening hours,
I believe it's gonna take them
approximately two years to get their investment back.
Next stop, downtown Minneapolis,
a high-traffic café where the sale is confidential,
so we're going in undercover.
SIMPSON: Today, I'm working with Kelly, who is a first-time buyer.
She's enlisted her sister, Lisa, to help her
find a small America café they can run together.
It looks like you plucked it out of a storybook, honestly.
Well, I did.
This next place I'm taking Kelly and Lisa to
is highly confidential.
Even though it's for sale,
it's not actively advertised to the general public.
Located in the heart of the city
in an office building with 3,000 workers,
this café is a turn-key operation.
The restaurant is listed at $120,000,
and the monthly rent is $2,200.
This fits right into their $300,000 budget.
A confidential listing is a listing that the owner
doesn't want his employees or his customers to know.
If the word gets out the restaurant is for sale,
the customers flee, the employees flee,
and the sales go down.
Ladies, this is something very exciting.
We've got to do undercover
'cause this is a highly, highly confidential listing.
Okay.
Okay?
Undercover dining for a confidential listing
is so important.
The owner and seller may be telling you
he's got the best food in town, he's got the best coffee.
You go in there, the coffee's cold,
the milk's sour, and the pastries are stale.
Really? You believe anything else he's gonna tell you?
We're gonna soak up the atmosphere
and see if you like this downtown city center,
which is very different from what we've seen before.
Absolutely. I mean, the ball field's right there.
How many thousands of people a day
are going past your front door?
We have an appointment to see the space later.
The owner won't be here, but for now, let's go in.
All right. Let's have a latte.
Sounds great.
SIMPSON: Our first order of business, trying to order.
Hello, sir. Is there anybody there?
Walking in, my first impression is
that there's no one behind the counter.
I think he's on the phone.
There's an employee you won't take on.
If I owned this restaurant, that guy would be history.
That's the kind of advice I'm here to give Kelly and Lisa.
So, you can see what to put right.
I think it's got a nice feel.
KELLY: Yes, absolutely.
I just don't know how you would
get people in the building to come in here
as opposed to all the competition
that's up and down the street.
You know, you have to look out for what's called your USP,
you're unique selling point.
What makes you different
to the corporate coffee shop around the corner?
You know, if we delivered things up to people's offices --
I mean, we could blast out there on social media,
"I can have a warm brownie on your desk in five minutes."
That's a great idea.
Kelly's a dreamer. I can see those wheels starting to spin.
But I'm a little bit concerned that we're gonna have
some pretty heavy competition downtown
and I'm not sure that we're gonna be able
to create the right atmosphere
and the relaxed feeling that we were hoping for.
Okay, how's yours, ladies?
The fruit is really fresh in here, so that's pretty good.
How's the panini?
Mmm.
That's really good.
Is it good?
And looks like my seven-layer bar is local.
Okay.
I like that.
And maybe I just won't even look at how many calories are in it.
One of the tricks I use frequently while undercover,
I will pretend to be the owner.
I will walk up to a diner just to see
how they like the food, how frequently the come,
'cause that way we're really gonna get to the truth.
And do you come in here every day? Just sometimes?
Good reputation?
Once the place closes,
we get our chance to investigate the kitchen.
Here's the nerve center.
Have you ever used one of these puppies?
KELLY: No, I haven't.
No? Ready? Whoo-hoo!
This is your steam train.
This is something that's gonna make lattes
hopefully to the tune of 300 or 400 a day.
And here's the other important factor --
coffee business is highly profitable.
How much do you pay for a cup of coffee, let's say a latte?
4 bucks, 5 bucks.
Do you know what that costs to make?
Less than 40 cents.
Really?
So, look at your profit margin.
There's got to be huge potential
for what they're doing here currently
versus what we kind of envision
for what we'd like to be selling in addition to what they've got.
Absolutely there is because this place is doing $150,000 now.
With what we've talked about with delivering upstairs,
you're gonna increase that business $100,000.
Well, let's walk out.
I want to show you my tablet
and show you the ideas that I've got for design.
SIMPSON: While Kelly and Lisa love this downtown location,
we can make simple changes to cozy up this dining room
to better fit their must-have
of a Mom and Pop-style atmosphere.
We'll start by removing the shelves, display cases,
and the clunky wooden storage cases.
I love how open that is then.
Right, then you've got a view
to some, like, customers coming through.
Next, we'll replace the front counter and creamer station
with new ones made from reclaimed wood.
Gone are the rugs, artwork, and harsh color scheme.
The seating will be updated
with larger tables and soft chairs.
Then along the length of the front window,
we'll add a long counter with bar stools.
You know, that's where people would sit
just to watch people walking by.
Add your food... it's a winner.
SIMPSON: With an estimated renovation cost of $12,000,
Kelly and Lisa are looking at almost $160,000 all-in
for the first year,
leaving them just over $140,000 for working capital,
which is plenty for a small café like this.
With the changes we're about to make,
it'll take about three years
to obtain their return on investment.
It's exciting to think about being downtown.
I mean, that place had great foot traffic.
I'm a little bit concerned that we're not gonna have
that Mom and Pop feel that we had talked about.
I still want to keep it on the table.
Seems like that one's a great opportunity.
This next restaurant I'm gonna show Kelly and Lisa,
even I'm scared about.
An abandoned bakery with high risk
but even higher reward.
[ Chuckling ] This has got to be a joke.
Good to see you.
Great to see you.
SIMPSON: Kelly is looking to start a new chapter in her life
after losing her husband in a car accident.
So, with the help of her sister, Lisa,
they're looking for a small American café
they can make their own.
So far, I've shown Kelly and Lisa
two very different restaurants --
a small café in a cozy community...
You know, it reminds me of an old English garden.
...and an urban café in a downtown office building.
It's exciting to think about being downtown.
Both are viable options,
but this next one is a bit of a wild card.
Located in a town with 17,000 people,
it's well situated on a main road.
But three years ago, it was left abandoned.
This is by far the scariest restaurant
I'm gonna show Kelly and Lisa.
I'm not even sure they're gonna walk in the front door.
[ Lisa chuckles ]
[ Chuckling ] This has got to be a joke.
I have no idea why he would bring us here
because it's completely rundown.
KELLY: Well, and I'm kind of wondering why the bakery.
We're looking for an American café.
What do you think? Isn't this amazing?
[ Laughs ]
Uh...
It's a great opportunity.
Why are we here?
It's a bank-owned property.
It's on the market for $49,900. That includes real estate.
Including the real estate?
Including the building, including half an acre of land.
Oh...
Now, remember, ladies -- imagination, imagination.
My first reaction walking in here
is this place is a dump.
There's, like, bird poop on the window inside.
Bird poop?
It's disgusting in here.
It is.
Keith, that is mold.
Yeah, there's gonna be a few things back here.
There really is.
Look at this!
I know it looks scary and daunting,
but it's only dirt.
I wouldn't have brought them here
if I didn't think they would be successful.
Oh, I want you to think out of the box.
Here, you've got all the space you need
for your Mom and Pop café, which is your dream.
That's what you were thinking of, wasn't it?
Yeah.
Right. So, here it is.
But I'm gonna tell you about another business
that you can add on to the back.
The bakery is gonna be a huge opportunity
at the same time as owning all the real estate.
We don't bake.
We don't know what we're doing.
Yeah, but are you risk-takers?
Well, yeah.
Yeah.
Adding the bakery component to this
is what is gonna make it
hugely successful and money-making for you.
The bakery part is then wholesale.
You have restaurants, you have supermarkets
all wanting sticky buns, bread in this community.
Lisa and I actually came here as kids.
So, I mean, I remember when it was a bakery.
KELLY: So, talk to me about the dining room space.
Right now, I see at least 50 here.
Take away that wall, you get another 10 to 20 in that area.
It would be kind of cool to do one of those
big, like, community dinning tables
right up the middle of the space.
Fabulous, fabulous. People love those.
Can you see this taking shape?
I still haven't seen back here, so I am a little bit nervous
about what kind of mess is going on back there.
I'm kind of an eternal optimist, and I would get myself
into a huge mess if I didn't have Lisa.
Checks and balances, right?
So, let's come back and see the kitchen.
Here, we've got an old cranking rotary oven.
Lisa, you're gonna be cranking.
[ Laughs ]
Okay? You're gonna have the oil.
You're gonna be oiling the chains.
Isn't that right, Kelly?
You know, it's fun talking about this,
but all this has to go.
SIMPSON: It looks like a big job,
but they can save by getting used equipment.
Now look what you've got in here.
Oh, my God.
Where they see a mess, I see a busy kitchen making a profit.
Round here, you've got tons of power
coming into the building.
Along here, you'll have refrigeration.
LISA: I don't know if we have the resources,
let alone the time to take care of this size of a project.
I need Kelly and Lisa to realize their own potential
so they can take whichever restaurant they buy
up to the next level.
The beauty of this space is that it's a blank slate.
After cleaning it up,
we'll add a classic tile floor and fresh paint to match.
You like those?
Yeah, I love this black on the beams.
SIMPSON: Half walls painted with a dash of red
will direct customers to the bakery cases.
The dining room will be a combination
of community tables and booths.
But the best part -- a window into the working bakery
to entertain the guests waiting in line.
So, you really think that we can
do all of this within our budget?
Absolutely, I do.
You have a budget of $300,000.
The building is offered for $49,900.
I think you can get it for less than that.
You've got $50,000 for the dinning room area.
You've got $150,000 for the kitchen.
And you've still got $50,000 to $60,000 left
for working capital and cash flow.
Yes, this can be done.
This bakery has the highest up-front costs.
But down the line in the future, it has the greatest chance
of making more money than the other two.
Now, I've shown you three different properties today.
But you need to sleep on this and think about it
or we need to make a decision
because these places aren't gonna last.
This is a big decision to make.
It's the biggest business decision
probably in your life.
[ Both chuckle ]
Okay.
A lot to think about.
We're about to find out which restaurant
Kelly and Lisa have chosen.
They need to throw the numbers out of the window
and go with their heart, their passion.
That's what's gonna make them so successful,
and I'm so excited 'cause I don't know
which one they're gonna choose.
With a budget of $300,000,
Kelly's entire future rests on this decision.
So, let's have a look. Let's see what we've got.
I like to recap a little bit.
Our first stop, the Cottagewood General Store,
is full of charm and doesn't need much
besides more indoor seating.
But right now, it's only open for half the year.
Well, you really can't go wrong as far as the feel.
I still am a little concerned, though, about the seating.
My bigger concern is more about
getting additional traffic in from just the neighborhood.
That is your challenge. So, let's look at the next one.
SIMPSON: The confidential café is in a prime downtown location
with a built-in customer base.
This business is ready to go, but it would need
a cosmetic facelift to feel more cozy.
The seating that you put along the window is perfect,
especially when people are leaving the ball game.
LISA: We can change the look.
I'm still not really sold on how
the clientele that we're looking for
is gonna happen here.
Okay, okay. Sure.
But let's look at the high risk, high reward bakery.
SIMPSON: With plenty of space for their café,
it's a two-for-one with the potential
to add a wholesale bakery business.
But the abandoned space needs a total overhaul.
Then when you start talking about all the equipment,
the renovation costs, it's a little frightening for us.
We've never owned a restaurant before, let alone a bakery.
Well, first place, I know. It looks daunting.
So, there's all three.
Yeah.
What do you think?
Um...right off the bat,
I think we can eliminate the confidential coffee shop.
I don't really feel like it's got
that Mom and Pop thing we were going for.
I just don't think it's there.
I respect that decision.
Now, we're down to the two.
You've got the Cottagewood and you've got
the high-risk bakery and Mom and Pop café.
What do you think?
On the one hand, you have something
that's a little more turn-key,
and the other one's just total wild card.
I mean, I think the opportunity is huge there,
but the risk is equally huge.
You're gonna think I'm crazy, but...
I think my heart's on the bakery.
Wow. Fantastic.
Yay!
Fantastic.
Oh, God, congratulations. Congratulations to both of you.
BOTH: Thank you.
Fantastic.
SIMPSON: Kelly and Lisa ended up getting the bakery
under asking price for $30,000,
leaving them $270,000
for renovations, start-up costs, and working capital.
Now that we're finally standing in the bakery that we own,
I just can't wait to get the doors open.
LISA: My wish for opening day is a line around the block
and everybody's still smiling when they get to the door.
I hope this bakery becomes a place for me
to come in and sit down and slow down
with the people who stop in
and really genuinely get to know the people
who care as much about this place as I do.
SIMPSON: For more about Hans' Bakery, go to...