Restaurant Incubator Project has Right Ingredients for Entrepreneurial Success

More than a few people dream of owning their own restaurant. They envision the unique recipes, the lively customers who will enjoy their food, and the charming ambience of their own establishment. Jeff Elsworth, associate professor in The School of Hospitality Business at MSU's Eli Broad College of Business, knows there is so much more to it.

Before entering academia, Dr. Elsworth spent 20 years as a restaurant manager and franchise trainer of managers. He now shares that hard-earned experience with MSU students in his classes on food and beverage management, food service planning and design, and facilities and maintenance systems management.

And, in a new venture, he is combining his scholarly research and teaching with a collaboration called the East Lansing Restaurant Incubator Project.

"The concept provides an opportunity for restaurateurs to test their cuisine concepts and run their business with reduced-cost overhead, while documenting information and generating data. We should be able to not only help the owners in the Incubator Project, but should eventually be able to pass along the research findings to other potential restaurant owners, investors, industry experts, and students," said Dr. Elsworth.

The physical space is designed for five to eight restaurant kitchen and table spaces. The goal is to provide approximately 18 months of overhead so that businesses can serve customers and potential investors in a venue that doesn't involve the full, and the expensive, set-up of a permanent restaurant. Owners will work with Dr. Elsworth and three teams of students covering an aggregate picture of marketing, operations, and finance aspects of each restaurant venture.

Reduced Start-up and Overhead Costs, Increased Experience

The East Lansing Restaurant Incubator Project is slated to open in the first floor commercial space of a multi-floor building at the corner of Grove and Albert, on the edge of downtown activity and a short walk from the Michigan State University north campus. Seven floors of loft-style apartments are planned for the rest of the building.

Jeff Smith is the project manager of new economic initiatives for City of East Lansing Planning and Community Development. Smith said, "We have been working with Professor Elsworth for a little over a year. His expertise and willingness to support the effort are invaluable. Having a world class program like the School of Hospitality Business is a perfect complement to a concept, and program, as novel as the restaurant incubator. It is Dr. Elsworth's real world knowledge that keeps this effort a reality."

Restaurant owners entering the incubator project will immediately benefit from reduced costs, and a learning environment that will permit missteps or mistakes at lower expense. The incubator project will have one liquor license and a common bar, some shared necessities in kitchen design dictated by state health codes (like a ventilation system), and the collective synergy that comes from giving customers plenty of options in a single location.

"It Should Serve as a Model for Many Other Communities"

Desi Anderson owns Gumbo and Jazz, a small eatery in East Lansing serving Louisiana cuisine with "a touch of creativity." She rents space inside another restaurant, and looks forward to joining the East Lansing Restaurant Incubator Project.

"The concept is excellent for start-up owners," said Anderson. "Many of us have great ideas and want to try, but the costs are intimidating. Health laws dictate that restaurant kitchens install a hood system for ventilation, and that alone is $25,000. Then there are all the things that you learn only by experience or by someone helping you learn, such as portion sizes, taxes or purchasing strategies."

"I encourage anyone interested to apply and learn more. The economy has affected the ability to get started with your own restaurant, and this project could provide the tools for success. I think it should serve as a model for many other communities. Not only is the city involved, but so is Michigan State University."

Students who work with Dr. Elsworth will gain valuable experience by practicing ownership-like thinking while involved with the project. Thinking like an owner for a constellation of considerations such as market niche, food and beverage sales, location, food allergies, staffing, and other aspects of restaurant management brings a serious reality to the students' work.

"We have developed courses that challenge students to behave like it's their business. Hotels, clubs, restaurants, and event planning firms want to hire students and graduates that have thorough knowledge and a practical approach because there isn't a large margin of error in the industry. It's highly competitive, fast-paced, and customers can be fickle. Not everyone will go on to own their own business, but the most successful employees are those that work as if they are the owner," said Dr. Elsworth. "That is why the restaurant incubator will be a powerfully positive addition to a student's resume."

"It is not a food court. These will be individualized, customized areas for customers to visit. One challenge will be to adapt kitchen space to accommodate different types of cuisine — barbeque in one location or sushi in another. We are working things out as we go along," said Dr. Elsworth. "This is an exciting project, one that has the potential to benefit entrepreneurs, students, and the community. Someday your favorite restaurant may have started at the East Lansing Restaurant Incubator Project."