the future of the hospitality industry

Prior to 2008, the idea of renting out your home or room to a stranger was considered ludacris. Now AirBnb is a 31 billion dollar tech company.

Prior to 2013, the idea of delivering any other food than pizza or Chinese was unheard of. Now Doordash, UberEats, and Postmates are billion dollar companies.

The hospitality industry is in a similar transformation/evolution. Food halls, ghost kitchens, cloud kitchens, shared kitchens, pop up restaurants are on the rise.

The COVID-19 pandemic has forced thousands of small businesses to close their doors for good. Now, more than ever, the hospitality industry has to think "outside the box" and prepare for a new "normal". As social distancing, curbside service and delivery become the new norm, the necessity for a full dining area has been greatly reduced.

We believe the pop up restaurant is the future of the hospitality industry. Consumers don't blink an eye when they see a bank in a grocery store, or Amazon in Kohls. Why should consumers blink an eye when they see two restaurant entrepreneurs under the same roof?

Any business owner that has experienced the process of leasing a commercial location can tell you it is an expensive and stressful proposition. Let's assume you wanted to rent a modest 1700 sq. ft. space in a busy retail area. For prospective, Smoothie King and Subway are typically this size.

Using current market rates in our immediate area, the rent at a location of this size would easily be in excess of $5,000 per month (without utilities and expenses). If you're skeptical, just call.

Now let's take a look at a bakery/pasty/candy business like yours. We can use Smoothie King and Subway as continuing examples. How often do you see patrons dining in at a bakery, candy shop, Smoothie King, or Subway? If you said "not often" you'd be correct.

Let's take a look at the economics of a lease:

Lease Down Payment/Security Deposit: $10,000-$15,000

Utility Deposits: $1,000 - $2,000

Finish Out: $10,000 - $25,000

Permits: $500 - $1500

Fixtures: $5,000 - $15,000

TOTAL UPFRONT INVESTMENT: $50,000.00+

These upfront costs do not include the fixed monthly costs of:

Internet: $100

Utilities: $2500

Grease Trap: $125

Fire Suppression Inspection/Maintenance: $100