Restaurant economy in Seminyak Bali

Saturday night I ate dinner at a small restaurant in Seminyak. While waiting for my food, I chatted with a Balinese lady, who herself owns restaurants in Seminyak. She told me that no one is making money right now, and there are people who are losing 10m rp per month.

Bali is a weird market for restaurants. The 4 groups of people you’ll find in Bali are: locals, expats, domestic tourists, foreign tourists. If the style of food isn’t Indonesian, that pretty much cancels out the local market straight away. Tourists are okay, but they are only here for a short time, as soon as they find your place, its time for them to go home. Expats, contrary to what many people think, often go for the cheap places, even prefering to eat at home to save money. If you live in Bali, you can’t drop 100,000rp on every meal.

Some restaurants do well because they can bang out product for a low price, meaning they attract many customers. The thing is profitability, and what is their margin after all is said and done? With so many place opening and closing, people scratch their heads, to figure out some thing different. The lady I talked to has operated restaurants in other countries, and told me she was extremely successful. Here in Bali its a lottery, with too much choice in a small area.

I’ve often tried to look at restaurants, from a distance almost, and figure out what exactly is the difference, between the ones that are busy and the the ones that are quiet. Three places come to mind that are always fairly busy; Santa Fe, Cafe Moka, Warung 96. What do these places have in common? Santa Fe and Warung 96 are the kind of places that look ‘non-threatening’, a cool places to sit for a while. Some people are put off by a stiff waiter at the door, escorting them to their table. Better to make the atmosphere ‘easy access’ where people can stroll in and relax. Another place that does this is Made’s Warung in Kuta, the place is always packed. Cafe Moka offers expats a place where they can come 7 days a week, for simple breakfasts, lunches and dinners.

So it seems to me, the place is actually more important than the food. Just hope you can knock out the food at a low enough cost, that leaves you with a decent profit. Last night I suggested that Seminyak might be a good place, to experiment with a take-away type food business. I think if marketed right, a take-away ‘Asian rice’ type thing might go. Just ride up on your motorbike at the window, and get served in 2 minutes. Whatever, I’m glad I’m not in the restaurant business, and will leave it to the professionals to figure out waht works.