FOOL ME ONCE SHAME ON YOU!

I have said from the beginning that the restaurant was a bad idea for SCA to take 100% ownership. It was too much of a financial risk( projected losses for 4-5 years and based on false assumptions). That’s my bias as I have said that the sooner it fails the more money we will save.

Here’s why this restaurant is failing and will ultimately fail:

1. People who return and return to the same restaurant do so because of consistency of product from food quality, friendly and efficient service and price. There never was enough competent market research to determine what had the best chance of success. Our Board of Directors by a 4-3 vote pushed an amenity agenda regardless of cost. Enormous legal costs were spent to create a contract that left SCA on the hook.
2. The Board of Directors wrongfully touted WHG who runs Buckmans as the right company. WHG runs restaurants generally attached to golf courses and has events and catering as their business model. That was not what SCA signed up for. So what you have is an ill-conceived model executed by the wrong operator. That evidence is everywhere as consistently good food and good service in a friendly atmosphere is not happening. And the current board majority pushes seeking solutions. Too little. Too late.
3. Catering was to be a key element and that isn’t working and an expansion to include outsiders fails due to the tax structure. And outsiders events weren’t desired at the beginning but the board is scrambling to figure out how to save it. Unfortunately Yorktown has failed and it is no longer a debate between positive & negative folks. The question is where do we go from here.

So what do we do?

1. The contract between SCA and WHG requires a one year period and then either party can trigger a withdrawal by notice of a six month transition period. That one year period ends sometime in later August.
2. I don’t believe current management and this Board of Directors have the ability to rescue the restaurant and if SCA doesn’t take some critical steps it is likely at some point in time that WHG triggers their exit. The worst thing for SCA is to ignore that possibility. This current board majority is capable of maximizing our loss.
3. What I would be doing now is deciding the best way to salvage the amenity and reduce losses. To find a restaurant entity now that will buy SCA out and operate is an option to explore. It doesn’t have to be a fire sale but we will incur a significant loss of wasted capital. My gut tells me that a breakfast/lunch deli is the best option to seek. Open from 7am to 4pm. But do we need to use the entire space? I think not. Just use the bar area as a fast food breakfast and lunch area like Subway, Einstein Bagels or Starbucks? Quality breakfast sandwiches, muffins, pastry and coffee and deli sandwiches. .This is where a survey and market research from homeowners would be helpful. But time is of the essence. The remainder of the space could be repurposed. I do not see this happening with current management nor current board majority. They are not competent. Look at their history.
4. So to have a chance at keeping a restaurant and not creating a fire sale environment is to elect a new board majority that will immediately give Sandy Seddon her 90 day notice, change counsel and start the process of seeking a tenant for the bar area. If successful we will stop the losses and recoup some money all subject to negotiation. The new board majority could create a committee of business professionals to lead this effort. I would volunteer to participate as a member but only if management is replaced by a new board majority. Then SCA will have about 9-10 months to get it done maybe more if WHG doesn’t pull the plug. The other option is just to shut it down. Those that claim it was designed to experience losses and breakeven in year five sold you a false premise. They had no clue and the projected losses far exceed their budgeting. SCA was just fed false rhetoric by Berman and Company.

So if you support taking prudent action please vote in a new board majority that includes John Marshall, Ben Leibson and Forrest Quinn. That’s the first step as I am sure they will recognize the problem and be better suited for solving it. No guarantees of restaurant success but maybe a smaller concept will work. That will be their decision.

If it were my decision I would pull the trigger at end of August and exit the WHG agreement after the 6 month transition period. I would even see if we could negotiate a shorter transition while exploring the other options.

But something has to happen now to cut our losses as Yorktown is done. If you haven’t voted and lean to the “status quo” candidates who support the 5 year nonsense I ask you to reconsider. Electing those who want business as usual because of friendships or otherwise or social reasons ought to look at the hard business realities facing SCA. Don’t buy the company line.” Fool me once shame on you.” “Fool me twice shame on me.”

Until next time…Robert