Confused and Frustrated.

Hi Im new to the board, but I wanted some answers and advice on a few things. This is going to be a lengthy post but here goes.

My brother and I have been working in independent greek house of pizza places for over 2 decades between us. He is 21 and I’m 27. The pizza place we worked at the majority of the time was extremely busy and taught us everything we didnt have titles whatever needed to be done we did it.

Our dream was to open our own pizza place, However we wanted to sell italian style pizza made in deck ovens not greek pan pizza. An opportunity came my way, An owner of a building had a vacant spot with a walk in cooler, flat grill, fryolater,salad bar unit, hood system and slicer. He wanted to open a pizza place but had no idea how to do anything in a restaurant, so he wanted to get 2 guys to run the store, build it up, and buy it from him in 3 years.

We took the oppurtunity to open the store even though we didnt like the idea of having to “buy back” our hard work used to establish this place from nothing. We were excited to get to test out our recipes on a grand scale.

Fast Forward to today, my brother and I are doing $6000 net a week we have a driver to take deliveries at night. We have been open for 6 months now. We both work 80+ hours a week he pays us $650 each. We do have down time but Im responsible for everything he shows up when he feels like it Im ordering food, making food, cleaning making deposits, paying all the vendors, never getting a day off. My brother and I are hard workers but feel like we are being taken advantage of, my fiance isnt happy about our lack of time together.
Anyway Ive calculated the store costs about $4500 to run, He claims he doesnt get any money from the store but I dont see how he doesn’t. What should I do?

Just a quick clarification, do you mean you are doing 6000 GROSS a month? It is just confusing because net means he is making that much money every month EBIT.

You guys should have a pretty good idea on what your P&L is if you do everything. Sounds like you are in a pretty good position to be bargaining… doesn’t sound like the place would run without you but it sounds like he is assuming all the risk if things go south. You need to sit down and hash this out with him, you’ve only been open 6 months and it needs to be done sooner rather than later. If you have an agreement to buy out in 3 years, you need to get that in writing.

Sounds like things are going well, despite the arrangement. Whether it plays out the way you hope or not, this should grant you the confidence to go out on your own whenever the opportunity arises and repeat your success elsewhere. Hopefully this guy is being honest with you, if not, hopefully he see’s the bigger picture and compensates you properly, or he’ll have to deal with finding out how to run a pizzeria really, really quickly…

Are you buying the location/ property or just the Intellectual Property?(that you already have) Is he the landlord and investor?

Basically there is Rent, Wages and Profit in any given business all three need to be present. Don’t confuse one for the other. Which one are you working towards?

Sorry the store is making $6000 a week after rooms and meals tax.

Yes I know exactly what we pay for everything and exactly what we payout I keep track of it. He wants to 1099 me my brother and the driver. The only area Im not absolutly positve on is insurance costs I have no idea what that cost is. Its just frustrating because I dont have enough money to start my own place.

Im buying the business in 3 years the building will still be his and I would pay him rent every month. Yes he is the landlord and the investor

If he is getting his rent then I think he will negotiate on most every thing else. You are looking at the future potential of the idea. It can grow beyond his rental and investment.

Thanks Ronny and everyone, Im just irratated that I have someone else taking credit for my hardwork and feel like there is no light at the end of the tunnel.

Here is my 2 cents, I think that you approach it as this is our base, 6000.00
our food cost is 2100 (35 percent) and one driver.
I would tell him here are my needs. I need one more employee. That employee will work 2 days to start we HAVE to have one day off each.
Furthermore my brother and I want 30 percent incentive over this base number EACH. Meaning we are going to bust our ass to drive up sales AND lower food cost but we want some of the rewards as well. Let him know that he will still be getting the larger share of increase. But you currently have no reason to increase sales as you make the same just more work.

This LandLord is on it!! Not only is his building being rented, he is getting you to build a profitable business in it which he also owns!!! Then later, he will offer to sell you the business, with financing available, while continuing to rent his building.

Simply put, you are just an employee, and probably one that is underpaid. You would be smart to save 2 months of pay and then look for an empty building and start your own business. You will go nowhere with this shrewd LandLord.

Thanks for the honesty, I think I was being naieve and knew deep down something wasnt right with the situation but I really wanted to test my recipes knowledge and experience on new customers to see if I had what it takes, restaurant owners that have what it takes to open sustain and grow a profitable buisness are truly a dying breed. Im really considering taking your advice and saving to open my true first place that I dont feel is tainted frim the start.

Also what is a 1099 simply explained, and can I be 1099 we dont have a payroll I get paid in what looks like apersonal check that has ouq buisness name on it that he signs.
Ive been pressing for a payroll check but its always something about payroll insurance(whats that?) and something about making us 2% owners so no workmans comp has to be paid

Your LandLord is full of it. YOU ARE NOT A 1099 INDEPENDENT CONTRACTOR! You are not an owner. You are an employee! As such, he is already breaking the law by not withholding payroll taxes and paying social security, and unemployment Insurance. He probably IS NOT paying WORKMAN’S COMP, which isn’t optional, its MANDATORY!

With the 1099 BS story he is telling you, he’s making you responsible for paying HIS MATCHING payroll tax liability. The IRS will view you as a self-employed individual, which means not only do you pay your own tax, BUT ADDITIONALLY, you’ll have to pay your own self-employment tax.

He most likely is under-reporting his sales to also cheat the state and local government out of their sales tax.

THIS GUY IS NOTHING BUT A NASTY, DISHONEST CHEAT. DO NOT BELIEVE ONE THING HE SAYS.

Make his day by calling the local Labor Department and reporting what he is not doing.

Yup, what he said. You are getting taken. Get OUT now.

Agree with pizza2007.
You have do have some negotiating power.

It has been a month since December was last here…I wonder what happened…I wonder if his pizza career is already over…

December , what happened?

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He also owes you overtime. Take him to wage and hour and make him pay.

Hey guys that was a few yrs ago. This thread was resurrected from the dead for some reason.

But anyway story was my bro and I continued running the store, until 2014. We were about to walk away to go start our own place, realizing his best option was to sell the buisness to us, he gave us a deal. We decided to take his offer. We are so glad we did too! Bc now we have the place to ourselves without any uneducated bs from him. We average more than triple that $6000 a week sales now.
My new wories are about the end of my lease, buying the bldg etc