Question about running a restaurant
 

I watch Kitchen Nightmares from time to time and the restaurant owners talk about being in debt hundreds of thousands of dollars. Last night I was watching one and they were in debt just under $1 million.

How did they get so much credit? Why does the bank keep giving out loans? How did they get the loans in the beginning?

you are leveraging against your business, property, contracts, and past business dealings. Plus you could also be getting private loans from friends and family. The restaurant biz is just so hard to keep afloat...

Don't know but good question

probably not only in debt to the bank, but to providers.

just dont let the menu touch your silverware or plate....

My cousin owned a restaurant; he would make 20K profit one month, and $1,200 the other. You have to be able to manage your cash flow.

He was never able to get a loan from a bank, and ended up losing his 400K home.

The best day I had when I owned my Deli, was the day I sold the Deli to some new sucker.

i've been meaning to ask you... can i see your boobs?

zuzana showed it all...

the least you could do is show some boobies.. (or full nudity if you prefer (I DO))

Most of the time it's debt to suppliers. They do net 30-45 and then let you hold out if you just can't pay. So you end up stocking stuff every month you can't pay for for 6 months and then whammo your month to month operating costs stack on top for 6 months and you're in debt 500k. Very easy to do.