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'You've got to analyze every expense' by ProQuest


Consumers have cut back on dining out during the recession, and that's meant about a 5 percent revenue decline for Pals Cabin, a moderately priced restaurant that serves breakfast, lunch and dinner. [...] that original 1932 eatery wasn't a restaurant - it was just a hot dog stand.

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									                                                             Lessons Learned
                                                                                                                                                                                                 began selling charcoal grilled steaks

‘You’ve got to analyze every expense’                                                                                                                                                            for 15 cents.”
                                                                                                                                                                                                      Being a third-generation restau-
                                                                                                                                                                                                 rateur “gives you the determination
Coleslaw serves as a business reminder about paring needless spending to survive during the recession                                                                                            and the grit that you can survive, but
                                                                                                                                                                                                 you have to be willing to do what it
       BY BETH FITZGERALD                   assumption that we don’t know when                        on payroll.                                    they’re a far cry from the Great            takes to survive,” Horn said. “Cutting
AS MARTY HORN looked to cut                 that will be.”                                                 He’s also been able to save               Depression, when two “pals” —               expenses while still giving customers
expenses at his West Orange restau-               Labor is Pals’ biggest expense,                     $30,000 a year on health insurance by          Horn’s grandfather, Martin Horn,            great value and great service in a
rant, Pals Cabin, he spent a lot of         “so we looked at every employee on                        talking with each employee to make             and his partner, Roy Sales — opened         friendly environment — that is what
time in the kitchen, closely examin-        our payroll and every hour they                           sure they were properly covered. For           Pals Cabin at the corner of Prospect        my grandfather was doing in 1932,
ing the workflow — and he got to            worked, to make sure we’re being as

                                                                                        Steven J. Dundas
thinking about coleslaw.                    productive as possible,” Horn said.
     “We had always made coleslaw                 Shifts were rearranged to put
from scratch, shredding the cabbage         more workers on between 5 and 9
and the carrots and then mixing it          p.m., when Pals does the majority of
with our recipe for the dressing,”          its business. Overtime was eliminat-
Horn said. All that chopping and            ed, and Horn laid off several employ-
shredding meant a kitchen worker            ees — something he clearly didn’t
was spending an hour and a half on a        want to do, but “we had to make sure
batch of coleslaw.                          our business was profitable at a lower
     So Horn began buying preshred-         level of sales.”
ded cabbage and carrots, cutting                  The coleslaw changes meant
coleslaw prep to 15 minutes. Even           Pals then needed one less prep
though preshredded is pricier than          cook in the kitchen. That employee
cabbage by the head, overall expens-        now sets up the whole salad station
es are now lower. “We redesigned            and the salad person, “who used to
about a dozen recipes” to cut down          start at 10 a.m., can now come in at
on kitchen labor, Horn said.                noon, when the lunch business is
     Consumers have cut back on             heating up.”
dining out during the recession, and              By driving down expenses in
that’s meant about a 5 percent rev-         line with lower revenues, “if and
enue decline for Pals Cabin, a moder-       when sales improve, we will already
ately priced restaurant that serves         be making money,” Horn said. “As
breakfast, lunch and dinner. So Horn        long as we can make money now, at
has taken his sharpest paring knife to      this level, we will stay in business. But
the restaurant’s budget, trimming           restaurants that can’t cut expenses
needless spending in ways that are          may be out of business.”
invisible to his patrons.                         The Horn family owns Pals
     “You’ve got to analyze every           Cabin and Mayfair Farms, a restau-
expense” if you want to maintain a          rant and banquet hall also in West
good business during a bad econo-           Orange. The two facilities have
my, said Horn, who runs the restau-         about 180 employees, so payroll
rant with his three brothers. “When         processing is a major expense. For                             Brothers Marty, left, and Peter Horn are third-generation owners of family-owned Pals Cabin restaurant in West Orange.
will this roller coaster end? We’re         30 years, the company had used the
operating our restaurant on the             same payroll-processing firm; by                          example, Horn discovered that one              and Eagle Rock avenues, where the           when he was just selling hot dogs
                                             switching companies, Horn said the                       employee was still getting the
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