Restaurants closing

m.j.w

Was just wondering how people can pay to start up a business only to close it a month or 2 later. I have no idea about the start up costs or anything, always thought they must be very high. In drogheda takeaways are always changing hands, how can people afford to pump money into starting up just to end up closing? Just recently there has been 3 or 4 closed, 2 of which that only opened this year. There is one takeaway that must have changed about 5 times in the last yea. How can they do it, and where is the money coming from to fund the business.

markymark21

m.j.w wrote: »

Was just wondering how people can pay to start up a business only to close it a month or 2 later. I have no idea about the start up costs or anything, always thought they must be very high. In drogheda takeaways are always changing hands, how can people afford to pump money into starting up just to end up closing? Just recently there has been 3 or 4 closed, 2 of which that only opened this year. There is one takeaway that must have changed about 5 times in the last yea. How can they do it, and where is the money coming from to fund the business.

Friends, families, loan sharks etc?

Its worth remembering that many take away's are used as a means for people (non-nationals especially) to launder cash. Chinese lad in work says he knew of a few Chinese restaurants (which changed hands a few times) which were used as a means for Chinese 'students' to make cash and move it around, they'd get a cut from any new operators who decided to take over the lease.

RATM

Money laundering could be one explanation- I know of at least three Chinese restaurants smack bang in Dublin city center where rents are sky high. Every time I pass them they are empty and doing no business- even a Saturday night they barely have 10 customers in. But they are still in business and have been for well over two decades so I'm a little suss to say the least.

But the main reason is likely to be a combination of people with redundancy payments start up full of enthuasism and then running into cash flow difficulties and being cut off by their suppliers.

Also Drogheda is a notoriously difficult town to make money in- there are some businesses that do extraordinarily well but the majority seem to come and go with alarming frequency. The town has been a graveyard for many business people who were successful in other towns and then expanded there only to leave 6-12 months later in debt. I don't know why it is, perhaps the population are fickle and don't return to restaurants even if they had a good time, perhaps there is just too much competition for the (now) limited discretionary spend on recreation and eating out.

Even that pub on Narrow West Street which changed ownership a lot and name (Squires/Drumms and a few others) was always packed Thursday to Sunday with about 400-500 punters. Now it is closed down and no-one seems interested in renting it. The Trinity Arms just 200 meters away was jammers with the drinking crowd from 1995-recently but that is closed too. I grew up there and there is no way I'd set up a business there- it seems to be an extraordinarily tough market to operate in.

m.j.w

RATM wrote: »

Money laundering could be one explanation- I know of at least three Chinese restaurants smack bang in Dublin city center where rents are sky high. Every time I pass them they are empty and doing no business- even a Saturday night they barely have 10 customers in. But they are still in business and have been for well over two decades so I'm a little suss to say the least.

But the main reason is likely to be a combination of people with redundancy payments start up full of enthuasism and then running into cash flow difficulties and being cut off by their suppliers.

Also Drogheda is a notoriously difficult town to make money in- there are some businesses that do extraordinarily well but the majority seem to come and go with alarming frequency. The town has been a graveyard for many business people who were successful in other towns and then expanded there only to leave 6-12 months later in debt. I don't know why it is, perhaps the population are fickle and don't return to restaurants even if they had a good time, perhaps there is just too much competition for the (now) limited discretionary spend on recreation and eating out.

Even that pub on Narrow West Street which changed ownership a lot and name (Squires/Drumms and a few others) was always packed Thursday to Sunday with about 400-500 punters. Now it is closed down and no-one seems interested in renting it. The Trinity Arms just 200 meters away was jammers with the drinking crowd from 1995-recently but that is closed too. I grew up there and there is no way I'd set up a business there- it seems to be an extraordinarily tough market to operate in.

Maybe your right!! I only ask as there was a resteraunt on wellington quay opened up by an itailian couple, got nothing but great reviews on the louth section here and from anyone I heard that went to it yet it closed after about 3 months. Everyone was suprised it closed down!! Before that it was owned by a spanish couple and it was called quay 4, it only lasted about 9 months

highlandseoghan

I think some people open businesses and think there going to make huge money from the start and they dont have a cash reserve to cover them at the start.

I know of a butchers in drogheda that only opened for 6 -8 weeks and has now closed. I heard he closed because he wasnt getting the level of business he needed.

If your opening a business you need money to cover your expenses for at least the first 6 months to get you started.

enricoh

rents in drogheda are fairly reasonable these days but the rates are a killer, still celtic tiger levels. plus theres still plenty convincing themselves its cheaper to shop in newry n spending their dough in the cafes up there