Opening a new restaurant or business is not for the faint of heart. There is a lot more to succeeding than a good menu. According to CNBC, around 60 percent of new restaurants fail within the first year. In London, it is not news that the turnover rate for businesses is high, but what is the reason for it?
Spruce on Wellington is the latest restaurant to lock up its doors. Thomas Waites is an executive chef and provider. Four years ago, Waites started an in-home catering service. Soon after, he opened and became the owner of his newly-closed fine dining restaurant.
“In the beginning, I said I don’t want you to go to Toronto or Stratford to have good food and good experience. I want you to be here and have that,” says Waites.
Spruce was a cozy little building with a tight floor plan but size isn’t everything. It was an original and refreshing addition to the local business scene. The restaurant had a unique menu, each dish crafted with an artistic touch.
Many reasons for a business failing
Tolu Aibana is a fourth-year student in the Ivey School of Business. She says that there are many reasons as to why a start-up could fail, such as: failure to understand the market, a market that is not ready for the product, or a team that does not work well together.
“London’s market to me is unique because London is a University Town, so huge portion of its demographic are students. [It] also changes the seasonality of London’s Market because [eight] months of the year, the students are here,” says Aibana.
She adds that businesses will have to adjust to a different marketing or operating approach with majority of their market gone during the summer months. However, Waites went against the typical target market of the forest city. Instead, he aimed to hit the smaller percentage of those in the mature age range who were willing to spend a bigger buck on a meal.
Although Waites found success in his approach despite going against the norm, what really triggered Waites’ change of heart for running his own restaurant were the lessons he learned through the experience.
Lots of sacrifices for entrepreneurs
“You don’t get weekends, you miss a lot of events with friends, you lose friendships because you’re not working nine-to-five. You’re working 80-90 hours a week. You lose relationships as well. It’s taking a lot out of me and so I’ve realize what’s important to me, and it’s cooking. [Cooking] is very important to me but my relationships in my life are more important. I have to do what I have to do for myself and I have to be happy and healthy,” says Waites.
“I would say that it’s generally known that most start-ups fail because it takes a lot of time and perseverance to launch a business. Not only do you have to be committed to the goal, you have to be able to put in the amount of work, perseverance and dedication,” adds Aibana.
Waites shares that there are two different types of entrepreneurs.
“There’s the one that just wants to have the lifestyle and have nice cars and have nice clothes and say ‘Hey, I own a restaurant.’ Partying and all that. And there’s the other entrepreneur who is in the business 24/7. Doing everything that he or she could do to make it work. [Giving] it all and that’s [who] I am – you have to be,” says Waites.
“Follow your heart”
Grit is essential to a successful business, but Waites says that nothing is as important than happiness.
“I would say you wish you have to follow your heart. I would say, if you’re doing something that you don’t love or is not your passion, why are you doing it? Life is so short,” says Waites.
Aibana encourages educational institutions to invest more resources to help shape future leaders in society.
“… At the end of the day, it’s great to create these bright individuals who can work at leading firms and what-not, but what’s really going to change the world is bright, young individuals who are willing to challenge status quo. [These] individuals won’t be able to succeed in society if the institutions that they’re attending don’t try to foster and motivate this kind of attitude and perspective towards the world,” says Aibana.
There are many reasons as to why London businesses have a high turnover rate, but for Spruce on Wellington, happiness and health came first. Although Spruce is no longer operating, London can look forward to seeing the bright minds of future entrepreneurs brewing up new innovations to come.