Interview with Izzy Kharasch: How To Rescue 700 Restaurants

I am a hospitality consultant. That means I train people—not just in the restaurant industry, but also in any other business that needs to be hospitable to grow, like medical or dental offices, and law firms. 

After serving in the army I graduated culinary school. I worked as a chef for quite a while, but one day realized it was not my passion. However, I still enjoyed being a part of the restaurant and hospitality industry. So, when consulting firms were even unheard of, I decided to start one. Back then, all I had was just a beeper and a few years later—a fax machine. I went door-to-door, offering training to increase productivity and help reduce staff turnover. Now, three decades later, we manage various restaurants, nightclubs and hotels nationwide with $70 million in total sales.

We often start by analyzing a company’s financials to identify areas where training can improve operations—whether it’s food costs, labor costs, or management. We get clients who are losing anywhere from $20,000 to $2 million annually.

But we don’t just give clients a report listing their problems and possible solutions. Instead, we identify where the training will improve the operations and step in for months or even a year. We implement the necessary changes to turn the business around and train the management to maintain it after we leave.

The most fulfilling part of my job is seeing my clients become successful and knowing that I had a part in helping their company prosper. 

A business owner approached because he lost $300,000 in the first year. We reviewed the restaurant’s financials and I reached out to the owner right away. It turned out, the general manager was not just taking money, but embezzling it—about $150,000 in cash over the year. The owner was stunned; he had full faith in him before.

The general manager faced arrest, charges, and ultimately, a conviction for embezzlement. Our intervention stopped their monthly $25,000 losses within just 60 days. Now, five years later, they are thriving and making profits.

First of all, plan ahead and calculate your costs. Some of our clients expect to invest in their first restaurant a certain amount of money, but when we do the calculations, it turns out that the actual cost is three times higher. It’s better to know it from the start—I generally tell people if you are going to fail, you will plan for your own failure six months before you even open. 

Secondly, owners need to be more involved in their financials. Many resterateurs just look at their profit at the end of the year and think everything’s fine. But if they managed costs more closely, they’d see that they could be making a lot more. 

Finally, it’s also very important to delegate. I know many owners who own 10 or 20 establishments and can’t possibly visit each one every day, but their restaurants are still thriving. The key is training great managers and employees to run the restaurant exactly as the owner would. If a restaurateur feels they have to be there all the time, then they haven’t trained their staff well. The most successful are those who have faith in their team. 

Also, owners with high turnover should take a hard look in the mirror. It’s not just about pay—employees leave because they don’t respect management or feel mistreated. 

My advice is to just work hard, at whatever position you begin your career. I’ve seen dishwashers work their way up to become managers and chefs.

The industry is beautiful that way—you do not need a college degree to be highly successful.

It is one of those very few professions where you can make it without a formal degree if only you are committed enough and have hands-on experience. If you prove yourself—showing up on time, asking questions, and working hard—you can advance quickly. 

Oh, the shift after COVID has been massive—more significant than anything I’ve seen in my 30 years. Before 2020 finding and retaining employees wasn’t too difficult. But now we see labor shortage like never before. Right now I’m working with a restaurant that typically employs 80 staff members in peak season, but we haven’t been able to fill more than 30 positions.

Many experienced professionals left the industry and chose careers with better work-life balance. The level of dedication among new employees also isn’t what it used to be.

Many only want to work a few hours a day or don’t even show up after being hired. At times, I think it might be a generational issue. But then I meet a young employee who is exceptional—punctual, hardworking, and truly talented. 

Customers today are more sophisticated. They are well-traveled, they have tried international cuisines and new dishes, and they have higher expectations for food quality and service. Even for something as simple as a hamburger, they want the best cut of meat or a unique blend. This shift has been great for the industry as it pushes the restaurant forward. 

It mostly addresses staffing shortages. For example, in a couple of our locations, we have started to use robots. They bring food from the kitchen to the dining room, saving the restaurant over $60,000 annually in labor costs.

We don’t use robots to replace humans—it’s more that we don’t have enough people to fill these roles, so we have to improvise.

We’re also seeing more automated kitchen equipment, like fryers that can cook food to perfection with the press of a button. It allows one person to do the job of three, and it’s making operations more efficient.

The fine dining segment might suffer because of the rising cost of livng. However, it won’t completely disappear—there will always be customers who can afford it. Fast-casual and casual restaurants are adapting better and this segment is going to get an even bigger market share. 

But whatever the concept, the goal for every restaurant should be to create a remarkable experience. Those with excellent food and service will always survive, and mediocre restaurants are the ones that will die out.

Even considering all the challenges, I do believe the future of the restaurant industry is bright. There’s definitely a growing demand for unique and personalized dining experiences and innovative concepts.