$20 for $50 of food - Sushi Motto

[dkmlam]

For you sushi or Japanese food lovers out there! Pay $20 for $50 of food/alcohol (should work like a gift card).

www.dealfind.com/calgary (http://www.dealfind.com/?a=55e38483c4da)

I've been there multiple times and it has been amazing! Great reviews from urbanspoon too. (http://www.urbanspoon.com/r/15/1542950/restaurant/Uptown-17th-Ave/Sushi-Motto-Calgary)

[Disoblige]

Thanks for the post.

If you make another Dealfind account and use your own referral link, it ends up being only $10 for $50 :P

[max_boost]

Damn it is a hot seller. Now I hope this place isn't jammed packed when I decide to check it out :nut:

[liquidboi69]

Sweet. Thx for the find, definitely gonna check this out.

[[Yu]]

thanks!

[dj_rice]

Already posted in CalgaryBlogs deals post

[Euro838]

Originally posted by Disoblige

If you make another Dealfind account and use your own referral link, it ends up being only $10 for $50 :P

+1 :thumbsup:

[dkmlam]

Originally posted by Disoblige
Thanks for the post.

If you make another Dealfind account and use your own referral link, it ends up being only $10 for $50 :P

I'm confused! Wouldn't it be $15 since you get $5 off?

[toyboy88]

Side note, good on alcohol too! ;)

[phreezee]

Thanks OP, got 3!:thumbsup:

[Disoblige]

Originally posted by dkmlam


I'm confused! Wouldn't it be $15 since you get $5 off?
True enough! $15 for this deal, since you will get $5. My bad.

[max_boost]

Is it $5 for each voucher they buy? Or is it $5 total regardless how many they buy?

[SpeedIllusion]

$5 for each voucher they buy

[project240]

Thanks!

[RX_EVOLV]

holy 2800 purchased. I probably won't even try to use mine until like March

[dkmlam]

Originally posted by toyboy88
Side note, good on alcohol too! ;)

:thumbsup:

[Guillermo]

i would actually recommend trying to use this thing ASAP, since groupons and others like it have been known to actually put restaurants out of business.

2800 sold * $20 = $56000 that they made today

$56000 - groupon's 50% = $28000 that the business made today

Now, although the restaurant just made $28000, they need to provide 2800*$50 worth of food = $140000.

$140000-$28000=$112000 debt this place has. now of course they have a *small* profit in there, but not much... either way, they basically just signed a contract to spend >$100k on advertising...

I don't know what kind of investors htey have, but that would be a large hit for a small shop... one that could put them into bankruptcy very soon. so, if you bought some of these, I would recommend using them ASAP.

[bignerd]

Yeah buf if the restaurant couldn't afford it why not lower the number of coupons sold? Cap it at 1000 coupons vs. 2800.

And while some people will spend exactly $50 many people will spend more over and above the coupon.

[rojhero]

Originally posted by Guillermo
i would actually recommend trying to use this thing ASAP, since groupons and others like it have been known to actually put restaurants out of business.

2800 sold * $20 = $56000 that they made today

$56000 - groupon's 50% = $28000 that the business made today

Now, although the restaurant just made $28000, they need to provide 2800*$50 worth of food = $140000.

$140000-$28000=$112000 debt this place has. now of course they have a *small* profit in there, but not much... either way, they basically just signed a contract to spend >$100k on advertising...

I don't know what kind of investors htey have, but that would be a large hit for a small shop... one that could put them into bankruptcy very soon. so, if you bought some of these, I would recommend using them ASAP.

I've been thinking about Groupon ever since they started. Although I agree the coupons should be used soon (I just booked a dinner for tomorrow), I don't think Sushi Motto just spent $100K on advertising. Even if they did, it won't impact their books anytime soon and they would only realize a small loss several months from now. There's no "large hit" so to speak. There are a couple more things (and potentially more) that we have to factor in when considering whether or not they will be profitable long term.

1) Advertising and repeat customers - you've already mentioned this. If Sushi Motto is as good as the reviews are, this Groupon deal might give them a huge kick in repeat sales.
2) Coupon value does not equate to debt - again, you've already mentioned this, although 12% profit is likely highly understated. The coupon requires that tax and tip cannot be included. Also, many cutomers will spend more than the value of the coupon and efficiencies will be gained with a "full house" of customers.
3) Coupon usage - many of those who bought the coupon will never use them. Perhaps 10-15% from a quick google search.

There's a reason why Google just offered $6B for Groupon and it's not just for advertising. People do see real value in this for both Groupon and small businesses. I'm curious to see how this will pan out.

[Guillermo]

Originally posted by bignerd
Yeah buf if the restaurant couldn't afford it why not lower the number of coupons sold? Cap it at 1000 coupons vs. 2800.

And while some people will spend exactly $50 many people will spend more over and above the coupon.

I don't own the sushi business, don't ask me to explain why they did it. :dunno:

here is some further reading:

blog: http://www.retaildoc.com/blog/groupon-worst-marketing-business/

NY Times: http://www.nytimes.com/2010/11/18/business/18sbiz.html?ex=1305694800&en=4bfab41d08b43068&ei=5087&WT.mc_id=BU-D-I-NYT-MOD-MOD-M176d-ROS-1110-HDR&WT.mc_ev=click

google it, i'm sure there are more.

[Guillermo]

Originally posted by rojhero

2) Coupon value does not equate to debt - again, you've already mentioned this, although 12% profit is likely highly understated. The coupon requires that tax and tip cannot be included. Also, many cutomers will spend more than the value of the coupon and efficiencies will be gained with a "full house" of customers.

i'm not in the restaurant business, but 1) I think you're underestimating overhead, and 2) even if you aren't, there is absolutely NO WAY a restaurant can give away $50 worth of sushi and alcohol and make only $10, PLUS pay salaries, electricity, insurance, gas, etc. on top of that.


Originally posted by rojhero

3) Coupon usage - many of those who bought the coupon will never use them. Perhaps 10-15% from a quick google search.

Is this stat for coupon or groupon usage? i'm willing to bet that Groupon usage is far higher than regular coupons, since the folks buying them have already paid for the good or service.... but i'm almost certain Groupon wouldn't divulge their usage stats on the internet.




Originally posted by rojhero

There's a reason why Google just offered $6B for Groupon and it's not just for advertising. People do see real value in this for both Groupon and small businesses. I'm curious to see how this will pan out.

As I mentioned, groupon takes 50% of the initial sales - $28000 - and they don't have to now give out $140k worth of free food like the restaurant does. groupon is raking in the dough. Forbes magazine (i think it was) recently called Groupon the fastest growing company... EVER. it's clear why google wants to buy them.

[rinny]

Originally posted by Guillermo
now of course they have a *small* profit in there, but not much... either way, they basically just signed a contract to spend >$100k on advertising...

I don't know what kind of investors htey have, but that would be a large hit for a small shop... one that could put them into bankruptcy very soon. so, if you bought some of these, I would recommend using them ASAP.

Word of mouth is the greatest advertising. Though many people will buy these groupon's solely for the discount they receive, it gives many people the incentive to try a place that they wouldnt have otherwise tried or let alone have even heard of.

Repeat visits are what these places count on. And from the one and only Groupon that i've bought, it was to a place that I will certainly return to and perhaps my favorite restaraunt in town (Victoria) now.

[Guillermo]

Originally posted by rinny


Word of mouth is the greatest advertising. Though many people will buy these groupon's solely for the discount they receive, it gives many people the incentive to try a place that they wouldnt have otherwise tried or let alone have even heard of.

Repeat visits are what these places count on. And from the one and only Groupon that i've bought, it was to a place that I will certainly return to and perhaps my favorite restaraunt in town (Victoria) now.

i understand this. what i'm saying is that many small businesses can't afford the massive expenses that a groupon can cause. you don't have to take my word on it... just do a google search and you'll see what i mean.

i buy groupons all the time. i'm just saying it's probably best to use them sooner than later.

[BokCh0y]

Thanks OP :thumbsup:

[rojhero]

Originally posted by Guillermo
i'm not in the restaurant business, but 1) I think you're underestimating overhead, and 2) even if you aren't, there is absolutely NO WAY a restaurant can give away $50 worth of sushi and alcohol and make only $10, PLUS pay salaries, electricity, insurance, gas, etc. on top of that.

I assumed incremental profit and also that the restaurant would have survived for at least a year without this coupon. I'm not a business grad or accountant, but I'm pretty sure this is the correct way to do it. Maybe they have to hire an extra server, but you're not really "giving away $50 to make $10 PLUS pay salaries, electricity, insurance, gas, etc. on top of that". Instead, you're giving away $50 to make at least $10 (because people will spend more) and maybe lose some because you have to hire another server part time.


Is this stat for coupon or groupon usage? i'm willing to bet that Groupon usage is far higher than regular coupons, since the folks buying them have already paid for the good or service.... but i'm almost certain Groupon wouldn't divulge their usage stats on the internet.

Stat is for gift card usage. My guess is that groupon is about the same. Some will be used for gifts to non-deal-seaking people and even people that like deals lose stuff and get lazy. I think the fact that this is an internet coupon might make it slightly easier to forget about too. I hope we can agree to disagree on this point.


As I mentioned, groupon takes 50% of the initial sales - $28000 - and they don't have to now give out $140k worth of free food like the restaurant does. groupon is raking in the dough. Forbes magazine (i think it was) recently called Groupon the fastest growing company... EVER. it's clear why google wants to buy them.

Agreed, but to be sustainable, this has to be somewhat beneficial for small business owners (not sure about long term or small businesses as a whole).


i understand this. what i'm saying is that many small businesses can't afford the massive expenses that a groupon can cause. you don't have to take my word on it... just do a google search and you'll see what i mean.

Definitely agree, but if executed correctly (unlike the case in your reference), there should be no massive expenses.

Please don't get me wrong, I agree mostly with what you're saying. I also believe that in this particular deal, it doesn't look so hot for this restaurant compared with others. I just don't think the picture is as bleak as you imply. It's always a good idea to use these earlier though.

Anyway, sorry to derail this thread. It was only a matter of time before some discussions started about Groupon. I should really be spending the time creating my own deal blog to direct traffic to the site instead. Then I can take a share of the fastest growing company. =).

[max_boost]

rojhero, write a review of it tomorrow.

Motto has sold almost 4000 of these vouchers. That's just insane for a small restaurant. :nut:

[Disoblige]

Yeah I would definitely use these coupons ASAP. 4000+ of these vouchers? Sounds like it will go downhill FAST lol. Could be wrong of course..

[C4S]

I wonder how they can keep the business ..

4200 coupon .. they get $42K back, but then need to serve $210K plus food/drink .. will be HUGE lost for them ..

They are at least, in $100K plus depp hole now .. :(

I bought 5, and will go this week, and I suggest to pay them good tips .. :thumbsup:

[dkmlam]

Originally posted by C4S
I wonder how they can keep the business ..

4200 coupon .. they get $42K back, but then need to serve $210K plus food/drink .. will be HUGE lost for them ..

They are at least, in $100K plus depp hole now .. :(

I bought 5, and will go this week, and I suggest to pay them good tips .. :thumbsup:

I think the business is relying on long-term outcome and profit rather than focusing on short-term losses.

They are expecting customers to return and spread the word via word-of-mouth to attract other customers.

Let's hope they have a surplus to start with so they are able to cope with the short-term hole they have dug themselves.

[Disoblige]

Well then.. They better deliver. What I usually see is that most people will be like "yeah it's good because of the coupon, but likely won't come back for full price". And.. Wonder if this place has new management from the last sushi place.

[max_boost]

They aren't in that deep of a hole.

I expect their costs to be in the 30% range.

So 42000/210000=20%

Assuming people spend over the amount, they'll be just fine. I don't know what the ownership arrangement is but maybe the owner(s) are hands on and get a portion of the tips etc. lol

Just advertising.

I just hope they can keep up with the huge demand now.

[Weapon_R]

Originally posted by max_boost
They aren't in that deep of a hole.

I expect their costs to be in the 30% range.

So 42000/210000=20%

Assuming people spend over the amount, they'll be just fine. I don't know what the ownership arrangement is but maybe the owner(s) are hands on and get a portion of the tips etc. lol

Just advertising.

I just hope they can keep up with the huge demand now.

Keep in mind that people will rarely stop at $50. I can eat almost that much on my own, and I don't intend on going by myself. Add a 20% tip, a few drinks, and you are well over $50.

[kenny]

They'll probably spend a lot of time premaking a shitload of the popular rolls so they can handle the demand. Probably wont be much better than all you can eat sushi until the crowds die down.

[max_boost]

Got my resos for Sunday at noon. They are completely booked up until then! :eek:

[rojhero]

I'll be there in half an hour. As recommended by max_boost, I'll post a full review. I'll try to write it tonight but I'm pretty busy today.

[cloud7]

Originally posted by Disoblige
Yeah I would definitely use these coupons ASAP. 4000+ of these vouchers? Sounds like it will go downhill FAST lol. Could be wrong of course..

I am not worried at all. Dealfind will give you a refund if the restaurant goes under.

[tenth]

Originally posted by Guillermo
i'm not in the restaurant business, but 1) I think you're underestimating overhead, and 2) even if you aren't, there is absolutely NO WAY a restaurant can give away $50 worth of sushi and alcohol and make only $10, PLUS pay salaries, electricity, insurance, gas, etc. on top of that.

Rojhero makes a good point. The underlined bits are fixed costs which they're going to have to pay whether they go through groupon or not. When evaluating a promotion like this you really need to consider the incremental cost/benefit and ignore any fixed or sunk costs.

I'm not sure what their margins are on sales, but I suspect this promotion would result in a small loss for the company (ignoring fixed/sunk costs), but that cost would pail in comparison to the cost of getting that many people through their doors using any other method.

[Guillermo]

hrm, well I guess you guys are right... all of the bankrupt businesses you read about on the internet and in The New York Times must be fake. :dunno:

[Cos]

Originally posted by Guillermo
hrm, well I guess you guys are right... all of the bankrupt businesses you read about on the internet and in The New York Times must be fake. :dunno:

did you read maxboosts post? He may know a thing or two about costs of running a restaurant.

Also I assume you can limit the number of vouchers that can be sold. I would assume someone calculated what they could handle.

[Xtrema]

Originally posted by Guillermo
hrm, well I guess you guys are right... all of the bankrupt businesses you read about on the internet and in The New York Times must be fake. :dunno:

I can see them breaking even. So depends on how fast people cash in, they my run a few lean months but may gain some regulars in the long term.

But they better not cut back In quantity or quality and piss off customer while people are trying them.

[SilverGS]

As max_boost said food costs generally run 30%.

They are giving up on potential profit for advertising not racking up huge debt. As with any promotion it depends on how the company handles it. If they can keep the quality and service as good as before with all this new business they will win in the end with return customers.

I have also heard that Margin at sushi restaurants are higher then other restaurants so my guess is they are close to breaking even if anything.

Of course it would be prudent to use the voucher sooner then later n case they don't handle things well and the promotion backfires and destroys their fledgling reputation

[Guillermo]

i'm not saying that they are gonna go bankrupt because of this, i'm just saying that it does happen. on the other hand, many of you are arguing why it won't happen. there are many examples of places that have went under, that's all i'm saying. :thumbsup: best of luck to the restaurant, though! from the pics, their food looks excellent. i wish i had bought one of these things!

[you&me]

Originally posted by Guillermo
i'm not saying that they are gonna go bankrupt because of this, i'm just saying that it does happen. on the other hand, many of you are arguing why it won't happen. there are many examples of places that have went under, that's all i'm saying. :thumbsup: best of luck to the restaurant, though! from the pics, their food looks excellent. i wish i had bought one of these things!

Maybe you should go try it anyways and pay full price... You know, to off-set their losses on all the vouchers :thumbsup:

That's the other thing these promotions do is spread word to others who didn't purchase the coupons... I know I'll be going. And I've seen similar topics posted on 4 other local boards... That's a lot of exposure that will last long after the promotion expires.

[Little Dragon]

What're some of the best ones to order?
Not much of a sushi expert and I'm always stumped when looking at the menu.

[max_boost]

Just had lunch there today. They opened at noon, we arrived at 12:15pm, party of 4. Got seated, service was friendly, quick and prompt. I noticed the place was basically 90% filled by 1pm and the tables that weren't, had a reserved sign already.

We ordered chicken katsu (generous servings), gyzoa (have had better), miso soup (typical), mango roll, cobra roll, deluxe assorted sushi/sashimi and the the tiger eye and flames roll. The last two really stood out, delicious!

In general the food servings are more than fair and the food was quite good.

We finished off with tempura ice cream, yum.

Overall, I would go back without the vouchers but man the vouchers just sweeten the deal for sure.

Total bill was $114.00

Used two vouchers for $100, dropped a $40 bill and off we went.

So $140 including/tip/tax for $80.

AWESOME.

[jwslam]

Originally posted by max_boost
Just had lunch there today. They opened at noon, we arrived at 12:15pm, party of 4. Got seated, service was friendly, quick and prompt. I noticed the place was basically 90% filled by 1pm and the tables that weren't, had a reserved sign already.


boat and i were there too lol.
i called at 1215 for a 1230 table.
I love how the owner's wife went around telling everyone that sushi would be a while because everyone else ordered sushi too.
we had yam tempura roll, flames roll (i didn't appreciate it that much actually), house special roll, dynamite combo. miso soup + brocolli something (with sesame sauce) appy.

the larger rolls had a double layer of rice going around like half of it... they need to work on that.
$5.55 bill paid 14.
we were there for like an hour 45 total... the soup came sooooo fast lol and that was about it.

i bought 2 so i'll be there again sometime soon =)

[Isaiah]

Just a friendly reminder for everyone that when using a coupon, either Groupon or otherwise, you should be tipping based on the total bill amount without the coupon. This isn't directed at anyone in particular, just a general comment.

[Guillermo]

ahhh, I love it when I'm right...


Originally posted by Guillermo
i would actually recommend trying to use this thing ASAP, since groupons and others like it have been known to actually put restaurants out of business.

2800 sold * $20 = $56000 that they made today

$56000 - groupon's 50% = $28000 that the business made today

Now, although the restaurant just made $28000, they need to provide 2800*$50 worth of food = $140000.

$140000-$28000=$112000 debt this place has. now of course they have a *small* profit in there, but not much... either way, they basically just signed a contract to spend >$100k on advertising...

I don't know what kind of investors htey have, but that would be a large hit for a small shop... one that could put them into bankruptcy very soon. so, if you bought some of these, I would recommend using them ASAP.



Originally posted by ANGRY INTERNET MOD
BLAH BLAH BLAH YOU'RE AN IDIOT, NONLINEAR


now, from today's FFWD:


Tom Kim, owner of Sushi Motto on 14th Street S.W., has had his share of negative experiences from placing an online deal with Dealfind.

“I needed to build a customer base,” Kim says, “and I expected this deal would sell about 500 vouchers.”

More like 4,400 vouchers.

If someone had asked him to spend $178,000 on advertising last year he would have laughed them out of his restaurant. But that’s the amount he says he ended up losing in profits when he signed up to offer $50 worth of Sushi for $20 last December. (Check the math: Dealfind collected 50 per cent of the profits, and with a five-per-cent credit card fee, Sushi Motto received $9.50 for every $50 of sushi ordered by customers with vouchers — a loss of $40.50 per customer, if they had paid in full.)

As for the promise of gaining long-term, loyal customers, Kim says he didn’t really gain any. “They just move on to the next deal.”

“I don’t know why any restaurant would sign up for this. You can’t make any profits.”

[dirtsniffer]

too true. but they probably could have earned some repeat business by not being so ghey about it all

[winson2001]

thank you guillermo for the link to the 2 articles, they are very interesting :D
it was mentioned that food cost runs about 30%, does that include wage/ rent/ utility/ etc? if 30% is cost of everything, then it cost him $15 to serve $50 worth of food, n he will get $9.5 back so he have lost $5.5 per groupon sold, thats only $24200 of a lost instead of $178000... I'm no where close to knowing any knowledge about businesses, but the owner is kinda of exaggerated he lost making it sound like it cost him $50 to serve $50 worth.

while the restaurant got really busy (i assume..) that might drive some of the reg customers away for being too crowded, and it might be tougher for them to up keep their food quality.... i dont think its a very good deal for them....

I guess the whole groupon thing might be good if ur in a mostly service industry like massage... cleaning... etc, where u pay ur employees busy or not, then every 45cent/dollar that comes in counts....

[C4S]

Probably not losing that much money .. but make less ..

Of course, some of my friends, everytime goes there, try to make the total ~ $50 .. that case, the Rest can't make a penny, but losing money ..

Everytime we go there, we rather spend ~ $70-80 total, will use one coupon, plus $40 cash or so, that case, the owner probably still make some money, (or at least, not losing)

Still, our first choice would be EL for Japanese food .. :D :D

[winson2001]

may i ask what and where is EL? Im willing to try anyone's fav rest :D

[SilverGS]

First of all he said in potential profit but I guarantee you I would never of gone if not for the voucher. May not of even heard about it. This also includes a couple people I bought vouchers for.

I am sure many of those 4400 vouchers would never of gone if not for the coupon so no way he lost out on $178,000 in profits since many would never of gone in the first place.

It is disappointing to hear him say that but I suppose he just did the math the article posted and thought crap!! I could of bought a house.

Truth is I liked my experience there and it is now among my choices to go to when I feel like eating Sushi. I hope he realizes that sure there was an advertising cost to his deal but I for one will go back and there is value in that.

[Disoblige]

El's have gone downhill slightly.. :(

[max_boost]

Originally posted by winson2001
thank you guillermo for the link to the 2 articles, they are very interesting :D
it was mentioned that food cost runs about 30%, does that include wage/ rent/ utility/ etc? if 30% is cost of everything, then it cost him $15 to serve $50 worth of food, n he will get $9.5 back so he have lost $5.5 per groupon sold, thats only $24200 of a lost instead of $178000... I'm no where close to knowing any knowledge about businesses, but the owner is kinda of exaggerated he lost making it sound like it cost him $50 to serve $50 worth.

while the restaurant got really busy (i assume..) that might drive some of the reg customers away for being too crowded, and it might be tougher for them to up keep their food quality.... i dont think its a very good deal for them....

I guess the whole groupon thing might be good if ur in a mostly service industry like massage... cleaning... etc, where u pay ur employees busy or not, then every 45cent/dollar that comes in counts....

Yes exactly. He paid around $24k in advertising and not $178k. :nut:

Assuming most people tipped well and ate above the $50, I would say there was a small profit somewhere or it drove traffic=advertising whatever you want to call it.

You know Asians though, always thinking about the MAX dollar, like every dollar lost matters etc. haha hence the $178k amount.

I've been approached by dealathons to run a deal but I declined. Honestly, spend $100, throw a sign on the side of the road, GRAND OPENING, 20% OFF just as effective. IMO. :dunno: :rofl:

[max_boost]

And btw, you can put a cap on the number of vouchers you sell. It didn't have to be 4400 although that's cool for bragging rights lol

I remember seeing Baton Rouge up on dealfind awhile back and they stopped it at 1000.

[Redwagon]

I've been back there a couple times without the coupon because I liked it there when I went with the coupon. So they got at least one extra customer but I'm assuming they converted more than one.

[guessboi]

smart business max_boost, smart business! :D Do the math and some common sense before you sign up...