Hey guys,
Some of you probably read a few of my old posts about my in-laws who own a Chinese restaurant in a less-than-desirable area and that is over an hour away from us. They're now in their 70s and continue to work their rears off, staying at the restaurant for 12+ hours a day with my FIL laboring in the kitchen and my MIL hunched over at the front desk taking orders on the phone and keeping track of the money. Their commitment to their work and work-ethic blinds them from the longer-term, especially now that they have a grandchild who my MIL has admitted she very much misses and will regret if she doesn't see him more often.
At first, we really wanted to push them to sell the place, but they would more than likely have to end up walking away from it if anything. I really don't think most Chinese restaurant entrepreneurs would want to pick this place up given the location. Other than the amount of money they make on delivery and also that they get pinged to have movies, tv shows and commercials filmed there several times a year, it's just not in a good area. They insist on staying open LATE too (like midnight). My cousin-in-law, who is a cop in the area, pleaded with them to close earlier and to work less; so instead of closing at 1am they now close at 12am....LOL And they stay open 24x7x365 pretty much; working through major holidays like Thanksgiving and Christmas. This is the life my wife grew up with - the restaurant was always child #1 to them.
Anyway, all that said, selling seems like a bleak proposition given the combination of all those things. So I'm wondering if there's another way out of this hell for them. Could they hire a manager (or promote one of the workers to manager) to oversee and run the restaurant while they kick back and 'retire' (or at least do the minimum amount of work while still reaping the reward [years and years of labor])? Could they even claim 'retirement' while still owning the business? I don't know all the tax implications but at this point in time they could use the cash flow. As it is, they don't have much if any savings (and if they do it's all in cash and not invested - they're so old school that they just stockpile their cash rather than investing and growing it via other means). I seriously don't think we could convince them to change their ways as far as how they handle and save their money. But at least having a cash flow would do something for them. Then, they could move down closer to where we are and just check on the restaurant maybe once or twice a month. As far as taxes, etc goes, they do have a CPA who they use but I don't know how much involvement he has in the business other than helping them with their taxes.
The only major roadblock I see with this approach is their [lack of] willingness to even consider entrusting the running of their business in hands other than their own. They [or at least my MIL] claims she'll go crazy and not know what to do if she "retired" - this seems to be at odds with her feelings about having a grand kid though. From what I've seen though, their tune hasn't changed all that much. At most, they have been making it a point to come visit us at least once every week - usually they'll come in late at night just before restaurant closing, stay the night, and stay through the better part of the day before heading back. They also refuse to move into one of those "senior living" communities, one of which is one not too far from us. We visited once with them and could tell they weren't very excited despite their friend who lives there desperately trying to sell them on it (part of which included her treating us to Hometown Buffet lol). Since they own a business and have a home mortgage, low-income housing would be out of the question...although, even if they didn't own the business and home mortgage and qualified for low-income housing, the wait-list is ridiculously long and pretty much impossible to get into if you're wanting to move in within a few years.
The other big catch is that they're only renting the restaurant space as a tenant, which obviously takes from their cash flow. It sounds like the landlord is increasing the rent too and I'm not sure what his terms will be. For them, they don't want to bother asking and just want to leave it up in the air and find out as they go...not very smart being the lesser of aggressors in this case.
At the end of the day, we obviously can't make decisions for them and they're going to do whatever they want to do. It's just going to be tough when one or both of them become hospitalized and we're forced into a situation harder than it should have been because of their poor decision-making. They're literally working themselves into the ground at this point, even if it doesn't feel like it for them. This whole "the restaurant gives me energy" is all a front IMHO. I think they've just gotten used to being tired all the time and showing face to cover it up at the expense of their pride.
Rock and a hard place I tell you.