Cooking Up Some Profits
Celebrity chefs move beyond the stove (and the camera) to corporate roles
Deen has also helped the company branch out into new products, developing a line of sauces, marinades, and spice mixtures. The company now has a presence in 40 percent of the country, but Schloss predicts that Deen-endorsed goods will open up stores across the nation to Smithfield. Deen says such opportunities have caught her by surprise: "One day I looked up from the collard pot and said, 'Shazam.'"
The new high profile has been jarring for those more used to thinking about baking sheets than balance sheets. When veteran chef Jean-Georges Vongerichten wanted to open a restaurant in New York he found himself in a two-month crash business course at the City University of New York's Hunter College. "I knew how to cook, but I never knew how to run a business," says Vongerichten. "I was 33 years old, sitting with a bunch of kids, so it was pretty memorable for me."
The class paid off for the French-born chef. Vongerichten now owns seven restaurants in New York alone and has stamped his imprint on restaurants from Shanghai to London. He recently signed with Starwood Hotels to create restaurants for the hotel chain. "Now this brings us to an even bigger league," he says. "I am relearning the corporate deal."
For younger chefs, business savvy has become as requisite as knife skills. The high-stakes world of running a restaurant in a city like New York is no longer as simple as dishing out a perfectly cooked steak. Opening a restaurant in New York costs about $1 million, not including salary, which starts at $250,000 for the top 10 percent of the Big Apple's chefs, according to the French Culinary Institute's Hamilton. High real-estate prices and tough competition have brought in investors who are looking to expand successful concepts beyond one restaurant. It's no longer about "how many pasta dishes do you have to sell to make a profit," Hamilton says. "It's not for the fainthearted; it takes someone with business savvy who will do what it takes to get attention."
Back to school. Four years ago, the school added a restaurant management class, cherry-picking professors from Cornell University's top-rated hotel management program. It's gotten so popular that chefs from as far away as Washington State have flown to New York to take weekend classes.
Unlike Vongerichten, New York's latest phenom, David Chang, plunged headfirst into the business end of cooking from the get-go. At 26, when most of his Trinity College friends were studying for M.B.A.'s, Chang wrote up a business plan to start a casual downtown noodle bar. "No one ever tells you that you have to have certain business skills and watch what you say to the press," says Chang, who apprenticed in kitchens in Tokyo and New York. "Here the cost of making mistakes is too much."
He eventually raised $130,000, applied for all the needed licenses, and hunted down a 600-square-foot East Village location on his own. Managing Momofuku Noodle Bar presented new challenges. "The first time I had to pay sales tax, I said, 'What...is this?'" he says. Now Chang, this year's winner of the James Beard Rising Star Chef award, has 75 employees and is set to open a third restaurant. "Opening a restaurant isn't glamorous," he says. "It's basically like opening up a shoe store-cash flow has to be good."
Of course, chefs can't forget what brings them fans in the first place. Backstage at the James Beard awards, Bobby Flay was changing from a presenter's suit into his chef's whites, getting ready to man his cooking station for hungry audience members. Even though he owns six restaurants, including the Mesa Grill in New York and others in Atlantic City, Las Vegas, and the Bahamas, and hosts multiple food shows, Flay says he spends about 90 percent of his time in the kitchen: "At the end of the day, it's all about the food."
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