We were reviewing a pizzeria with an arcade when something did not add up. The business normally generated around $80,000 a month. During bank verification, the current month appeared to be tracking closer to $40,000.
A drop like that deserves a question. What happened?
The pizza oven had broken. Customers could still use the arcade, but the restaurant could not make pizza. The owner was waiting for insurance, and the replacement oven was going to cost roughly $20,000.
Understand the cause before judging the decline
Restaurants have money going out constantly. Inventory, hourly employees and regular operating expenses do not stop because a piece of equipment fails.
We asked the owner to document the situation. He provided video showing the equipment problem and the arcade operating while the pizza side was quiet. That helped explain the revenue decline.
We funded the business, and the owner had a replacement oven within about a week. He later paid off the funding in roughly two months under negotiated early-payment terms.
A repair needs a repayment plan
The useful question was whether replacing the oven could restore the part of the business that had stopped producing. We still had to look at the payments and what the business could support while recovering.
Every equipment emergency is different. Insurance proceeds, installation delays and reopening demand all affect the plan.
Watch the video
Broken Oven Cut Sales in Half: A $50K Pizzeria Funding Case Study
Let’s talk about your business
If a breakdown is costing your restaurant sales, explain what failed, what it costs to fix and how the repair changes your cash flow. Visit treeoflifefunding.com/apply to discuss your options.