Brower: How to avoid unpleasant surprises after opening a food business
December 22, 2016
In my last five years of working with Grand County entrepreneurs who want to open food-based businesses I have discovered an unfortunate circumstance that crops up frequently.
Because the restaurant and food-based business health inspectors work for the state of Colorado and not for Grand County, they are only in the county completing their personal, on-site inspections about once every three or four weeks. Because of this, business owners who are in a hurry to open their doors with the health department's blessing frequently complete "honor system" questionnaires and floor plans to send to the state so they can open "conditionally" before an inspector can complete an on-site inspection.
The on-site inspection comes some time later. This usually takes place after the restaurant has been leased and after business has commenced. Many times the restaurant operator has some unpleasant surprises at the time of the on-site inspection. The surprises can require improvements that are extremely expensive. In rare cases the inspection can result in a complete closure of the business.
Here are some examples of the sorts of unpleasant and expensive surprises confronted by these well-meaning business owners. They will need a new hot water heater to meet new and more stringent hot water flow standards. They will need to put in or relocate sinks or mop sinks so that the placement eases the sanitary preparation of food. They may need a new hood over a deep fryer. Perhaps the refrigeration system isn't adequate for the state standards for storage of food. Perhaps the wall or ceiling coverings aren't suitable for proper sanitation. The possibilities are endless.
These problems are surprisingly expensive to fix. A new water heater, with installation, has frequently been costing in the neighborhood of $4,000. Moving sinks or mop sinks or installing multi-chambered sinks can be a lot more expensive than imagined if it requires jack-hammering a concrete floor and running plumbing (for drainage and water supply) from a far reach. I've seen the cost of a new mop sink that required in-floor pipe-placement run as high as $3,250 (labor and materials). New hoods are extremely expensive ($20,000 at least).
You get the idea. Sadly, these sorts of surprises crop up right when a budding entrepreneur is at the end of his or her cash flow for start-up and not really seeing significant income from operations. So, basically, they can't afford these required repairs. They must scrape the bottom of the barrel for cash or, god forbid, borrow more money.
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This is not to say that the health department repairs and improvements are somehow excessive or unnecessary. We need health and sanitary inspections.
What I'm saying here is that the "surprise" element of these needed improvements can be mitigated.
Anyone who is considering opening a restaurant or food-based business should always, long before signing a lease or buying, have what the health department calls a site evaluation. The cost is $75 and such an evaluation can be scheduled by calling the Colorado Department of Health and arranging an in-person meeting with a health inspector so that the proposed location of the restaurant can be evaluated long before a lease is signed or the doors are opened.
What do I mean by "long before?" I suggest that such an evaluation take place at least four months prior to the planned opening and at least two months before a lease is signed or a property purchased. This way the entrepreneur can know way ahead of time what to budget for the important health and sanitation repairs and upgrades that would be needed.
They say being forewarned is being forearmed. This is especially true with food-based businesses that must meet health and sanitation standards.
Patrick Brower is the Enterprise Facilitator for the Grand Enterprise Initiative. He provides free and confidential business management coaching for anyone who wants to start or expand a business in Grand County. He can be reached at 970-531-0632 or at firstname.lastname@example.org.