Office Hours: Expansion Is the Fastest Way to Go Broke

I’m Josh Kopel, a Michelin-awarded restaurateur and the creator of the Restaurant Scaling System. I’ve spent decades in the industry, building, scaling, and coaching restaurants to become more profitable and sustainable. On this show, I cut through the noise to give you real, actionable strategies that help independent restaurant owners run smarter, more successful businesses.

In this episode, I dive into what it really takes to scale a restaurant successfully—and why opening a second location isn’t always the right next step. I break down how to strengthen your systems, master your financials, and get your house in order before expanding. I share the key lessons I’ve learned about maximizing one restaurant’s potential first, so growth becomes sustainable, not stressful.
 
Takeaways

• Expansion isn't a milestone; it's a multiplier.
• A second location doubles your overhead, not your skill.
• Scaling inside one location is smarter, cheaper, and faster.
• Most operators have 30 to 40% more revenue potential in their existing location.
• If you can't take a two-week vacation without issues, you're not ready to multiply.
• Expansion is math, not momentum.
• You need a minimum of 18% net profit margin before expanding.
• Having a cash cushion of six months of operational costs is crucial.
• You should have a leadership team that can clone themselves.
• Focus on maximizing current revenue before considering a second location.

Chapters

00:00 Introduction to Restaurant Success

01:51 The Myths of Expansion

05:40 Preparing for Expansion

07:07 Actionable Steps for Growth

If you’ve got a marketing or profitability related question for me, email me directly at josh@joshkopel.com and include Office Hours in the subject line. If you'd like to scale the profitability of your restaurant in only 5 days, sign up for our FREE 5 Day Restaurant Profitability Challenge by visiting https://joshkopel.com.