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TRANSCRIPT
Stoking the wood oven is a daily ritual at a busy pizzeria in Melbourne’s east, owned by Daniel Barrese (Bah-RAY-see) and his wife Sansita Bootsrakoothanachok .
“We're making the wood fire Napoli style We have a big oven which is very high temperature."
The couple has worked hard to turn the business around financially, after a long struggle. Like many owner-operators, they initially followed a well-worn path.
“We didn't pay ourself or the money that we make, it's go to the staff, it's go to the wages, go to the cost. So its not very good for the business."
Despite plenty of dine-in and take-away orders, wages were eating into profits. Ms Bootsrakoothanachok, who is a migrant from Thailand, said their first challenge was to reduce service staff.
“I talk to my husband, can I handle the floor alone when we not busy like the weekday even though when we are full house I'm very confident that I can handle alone."
It was an exhausting move for the couple, who married seven years ago, but one that paid off. Ms Bootsrakoothanachok says cash flow has gradually improved.
“Sometime we nearly give up and my husband actually asking me, are you all right to do this? I tell him that I am Thai and I am a fighter. After a year we have a meeting with our accountant and they actually say, what did you do to the place? Now we start to have a profit! "
Hard work turned the tables at Boss Pizzeria, but a new report shows that, many other hospitality owners have given up. Patrick Coghlan (PRON: Cog-lan) is the CEO of credit reporting agency CreditorWatch) .
“We are looking at about one in 10 food service businesses shutting its doors. Now that could be voluntary administration, it could be insolvency, it could be just closing the business down. That is a record high failure rate that is double the national average."
Industry advocate Wes Lambert, CEO of the Australian Restaurant and Café Association says falling revenue and soaring costs are to blame.
“The cost of goods sold, cost of produce and protein and coffee and other input costs into businesses, not to mention skyrocketing increases to insurance and utilities and other underlying expenses that those businesses pay. Operators around the country are telling us that there's just no money in hospitality, so they just are not paying themselves and they certainly are not able to pay any arrears to the ATO or any back rent that's due."
CreditorWatch says smaller food service operators running on razor thin margins are likely to remain at risk for the rest of this year. Patrick Coghlan explains.
“Demand has obviously softened significantly in the consumer spend, particularly for dining out and we talk about it as this concept of trading down with real wages falling and interest rates up. Australians are cutting non-essentials.
To survive means managing costs. Ms Bootsrakoothanachok says savings were made by reducing food waste and getting up early to buy fresh vegetables.
“We go into the market ourself and we prep by ourself and we do the service as well. So the business is to the point where we paid off our loan, we don’t have any loans anymore and I am very happy at this point."
Another secret to their success she says - friendly service! And customers agree.
“just love the pizza here, I love the customer service and the atmosphere."
It has taken time to turn a healthy profit and Ms Bootsrakoothanachok hopes their success can inspire others. The couple can now afford holidays to see family in Thailand and recently bought their first home.
“Very, very proud. I achieved the big, big goal in my life. And I'm not scared of anything now. I just have to try hard and keep fighting."
