Consider the costs of opening a new sit-down restaurant in terms of real estate. In a market like LA, the usual down payment for commercial space is estimated to be between $150 and $350 thousand dollars. That’s before you include in the expense of renovating and installing a new kitchen, which may run into the millions of dollars.
Then there’s the matter of work. A typical fast-food business must budget for around 25% of sales to be spent on labor. A fine dining establishment will be charged significantly more, frequently up to 40% extra. This equates to $400 thousand in annual labor expenses for a location that earns a million dollars in top-line revenue.
Paraphrase by Quillbot.com