Save ZenKitchen [General]

2014 May 26
Only hours in and .... $2000 raised by 11pm , Monday, May 26th.

www.gofundme.com/9io1xo

Please don't shoot the messenger here. I am not endorsing the saving of a restauranteer who may or may not have financial difficulties .. for whatever the reason(s) or no reason(s) at all.
I'm just here reporting.


2014 May 27
"they have fun afoul of the overbearing hand of government, namely the Canada Revenue Agency (the CRA) and now, the CRA has forced them closed."

This really pisses me off. Allot.

I work hard for a living, and I pay taxes on my pay cheques. And I pay even more taxes when I buy goods and services. This guy has a registered business and he collected those taxes on behalf of the government of Canada. He failed to remit those taxes to the government and now he's crying because they shut him down.

I'm not crying for him.

He had an obligation to pay that money to the government and he used the money for god only knows what instead of doing that....and now he wants us to feel sorry for him. CRA doesn't shut businesses down because they owed $4000 in remittances (the amount on their account when seized by CRA) they do it when it's in the tens of thousands.

Sad that a local restaurant has closed down and people lost their jobs, but if we have to pay our taxes everybody should.

2014 May 27
Maybe he was using that money to pay his employees and suppliers that he owed? S

While I understand that it's an obligation to pay taxes, not all of us have 16 or so people depending on us for income. So what do you do in that situation...pay the government and not pay your employees or pay your employees and not pay CRA (ultimately I realize you're simply delaying the inevitable...)

From what I have read he didn't owe just $4000...that's what was seized from the bank account. I'm not quite sure the total was ever revealed but understood that an agreement had been made to pay $3000/month. CRA then said pay us $20,000 which Dave could not pay.

Now to what Stuart is saying...CRA doesn't just shut down a business for no good reason so maybe this was an approach they already explored? Perhaps he was warned by CRA and informed that this was the next course of action...who knows.

3 sides to every story...your, theirs and the truth.


2014 May 27
I agree with what Stuart S is saying.

But I can stand behind this bailout more than the $700 billion the US government spent to buy garbage mortgage-backed securities and bailout Wall Street investment banks! Sorry, OT :P

2014 May 27
Jru, the point is, it was never his money. He was collecting it on behalf of CRA. Or to put it another way, he was holding it "in trust" for CRA until he was legally responsible to remit those funds. Lawyers hold funds in trust for clients. Same idea - it is not the lawyer's money. if I buy a house and put a down payment down that money goes to a lawyer who holds it in trust for his client. I am sure that client would rather (legalities aside) that he not use those funds to pay for staff or whatever else catches his fancy.

2014 May 27
As a person who collects HST on behalf of the government I understand full well that it is their money. Not mine. I have, in the past, paid them before or instead of paying myself. You should know that they are willing and able to shut you down. If you cannot remit the taxes that you have collected then you have a serious underlying problem with your business. Saying that, the CRA is sometimes a bit heavy handed.

2014 May 27
Dave isn't running the 'fundraising,' so I can't really fault him for it, but yeah, it leaves a bad taste in my mouth. Reminds me of when the Mayfair got people to pay for their new projector. If you're running a business and you can't pay the bills, maintenance, wages, and taxes -- you know, run a business -- it's time to make some tough choices. It's not a charity.

They're at over four grand now, though. Never underestimate spiral-eyed vegans. (I'm being flip, I've had several excellent meals at Zen Kitchen over the years)

2014 May 28
In the (hopefully unlikely!) event that they refuse, the funds will be dispersed to the staff who didn't receive their last paycheques. Anything left will go to unpaid suppliers.

^^^^...this is not too cool!ff
Not paying staff? I hope somehow they do make an arrangement to pay employees sometime.

It is too bad if they close, but the food is good and maybe if I could afford to eat there I might consider helping.
Then again the breaded mushrooms are almost $20 there......

2014 May 28
Well if he wasn't remitting the taxes to CRA they had a right to seize the funds in his account, and he probably still owes them . . .

The restaurant business can be a money pit, but "go fund me", the online equivalent of begging, is not the way to keep a business afloat.

Make good food and sell it, at a profit after all expenses are in, at a price the customer finds reasonable. It's the same for any business.

If he was doing that, but still in the red, then perhaps he isn't watching the till carefully. I've chatted with a few restaurant owners. Because a lot of transactions and tips are in cash, unfortunately people steal. They can also steal food, driving up costs. I'm talking staff here.

One friend who owns a high end French restaurant in Ottawa (a place with a great reputation, but a money pit for him), says he basically breaks even on food, because it's not cheap to buy the best ingredients and pay good chefs. If he has a chance to make money at all, it's on the alcohol. If he can buy good premium wines on sale and cellar them, the can make enough margin on the alcohol sales to stay in business (he hasn't so far, but he thinks he can get there).

If you are not good with money or accounting or minding every nickel, don't go into the restaurant business or you will lose your shirt !


2014 May 28
I've never eaten there, though I'm mostly vegan (or try to be).

I think prettytastyreviews might be on the right track though. The food is good, but too expensive. In which case he doesn't have a sustainable formula for business success yet.

2014 May 29
Pay your taxes and you'll stay out of trouble.
If this works all the other restaurant owners in the city who have investors and bank loans will be mad at themselves. This guys getting money from complete strangers who want nothing in return.
I think you'd have to be crazy to give this guy a dime.

2014 May 29
From Ron Eade's blog this morning, for those who missed it:

ZenKitchen has “tentative deal” with tax man that could see it reopen in June

roneade.com/?p=1402

2014 May 29
Another way to save / start a business (a pub in this case). They offered customers a free beer for life for $1000:

Does it work ? Is it profitable ? I need an actuary !

www.nationaljournal.com


2014 May 29
You know, I really want to meet this 'tax man' some day. I think he'd have some really great stories. I'd buy him a beer and we'd laugh and laugh and then I'd kick him in the teeth when he wasn't expecting it.

That's my dream.

2014 May 29
Since we have a queen, (God Save the Queen !), shouldn't it be called the tax woman ?

2014 May 30
"Yesterday, our accountant and I had a serious discussion"

His accountant is an idiot. He should have told him to close when he realized he had to rip off his customers and the government of Canada to stay open.

The fact that people are willing to help this guy pay his debts off when the business isn't viable is amazing to me. There isn't a single restaurant I've ever eaten at that I would part with my money to save because they made terrible business decisions. I just don't get it.

2014 May 30
I find it difficult to condemn the generosity of others.

2014 May 30
I loved Zen Kitchen, thought the owner was great. Too bad things did not work out. However, I would rather see Zen kitchen's return happen based on hardwork/ downsizing/streamlining/merit/etc, and not by this type of bailout.

There are so many fantastic community programs in that neighbourhood that struggle to survive. I can't help thinking of how much they could benefit from the money being raised...

2014 May 30
re: condemning generosity

Me too, and that's very big of us.

Generosity is one thing. Offering to straighten a crooked picture frame in a house with a crumbling foundation is another.

2014 May 30
I'm so torn on this. I'm vegan and have dined at Zen Kitchen roughly once every two months since it opened. I loved Caroline, but Dave always struck me as a little strange. Not bad, but strange. When Caroline left, there was a definite change in the vibe of the restaurant. I started going less frequently.

While I want the restaurant to continue (because I love their food and I hate to see those great chefs penalized for this), I don't want it to continue like this. If your business ran afoul of some tax stuff, and you've admitted it your problem, deal with it instead of accepting a bailout. Close, open a new venue after you've sorted your stuff. If your fanbase likes you enough to try to raise 20k, they'll like you enough to try your reopened/new venture.

2014 May 30
And the taxman also motivates (or he did for Richard Branson):

“Incentives come in all shapes and sizes,” Branson wrote, “but avoiding prison was the most persuasive incentive I’ve ever had.”

www.slate.com

Branson negotiated a settlement with the government, totaling 60,000 pounds, worth more than 700,000 pounds today. If he couldn’t pay, he would be re-arrested and put on trial.

This being the story of a future Davos fixture, the incident turned out to have a silver lining. In order to pay back the previously unimaginable sum they now owed to the queen’s government, Branson and Virgin needed to learn how to run a business. “The next two years were a crash course in how to manage cash,” Branson wrote. “From being a completely relaxed company running on petty cash from the biscuit tin and a series of unpaid IOU notes, we became obsessively focused. We used every penny of the cash generated from the shops towards opening up another shop, which in turn was another pound towards paying off my customs and excise debt.”

2014 Jun 1
I find it difficult to feel good about someone who failed at business being generously bailed out while so many people who work in our community have children that go hungry. I'm not against generosity in any way, I'm against rewarding someone for not doing the right thing, and if his settlement with CRA is $20k he wasn't remitting them for a while...not when he had a bad period last year as he states all over the media. I wish CRA could publish what he owes and how long he went without paying...I bet people would be less generous if they knew the truth.

2014 Jun 1
Having owned a small business - an art gallery - I would think "robbing Peter to pay Paul" is not uncommon. I remember paying my artists before they Hydro Bill from time to time. Not sorry about that.

What I do find troubling is that initially the fundraising was to pay staff and suppliers, which I thought was a good cause. Now the site says its to pay the CRA. I don't like it when the purpose of donating changes. Would like more clarity on what these donations are being used for. CRA? Staff? Suppliers?...

2014 Jun 1
People aren't donating to this fund explicitly to benefit the business owner--that's just a side effect. They are donating to keep a place in business because they *want* it to stay around. Most donations are selfish, and there's nothing wrong with that. It's the same reason I promote good restaurants here without charging for advertising. I want to live in a city with great food choices!

Personally, I wouldn't donate any money to that fund for two reasons: 1. I'm not vegan. 2. A sustainable business needs to be run by someone who would close *before* getting behind on something as fundamental as HST payments.

2014 Jun 1
If people are willing to donate to keep the business around, then the restaurant should raise it's prices and customers can keep the business profitable, and around, by eating there at a price that covers expenses and taxes. But some people have complained it's already too pricey. So that may not be a viable solution.

If it's the staff they are concerned about, they can leave bigger tips.

If it's paying CRA they are concerned about . . .

2014 Jun 11
Just saw this on Ottawa Citizen. A lot if money has been raised. I wish people would be so eager to give money to people in dire need...

ottawacitizen.com

2014 Jun 12
"Loan struck a deal with the CRA that will allow him to re-open if he can pay the CRA a sum “in the tens of thousands of dollars” before July 1. He must also pay debts to suppliers and staff.

Loan said Tuesday that the money raised at Korean Palace plus more than $7,000 raised so far by a separate online funding drive would be used “to pay back staff and to begin moving forward.”"

He's still more worried about paying his staff than paying the money he duped his customers out if in the name of CRA. I hope CRA tells him that he either pays every cent he owes up front, or they'll shut him down again after seeing his intentions for the money.

This whole thing disgusts me.

2014 Jun 12
Haven't read today's Citizen blurb yet but I gotta say that he likely owes CRA over $50,000 or more. I don't work for CRA or anything but ... I don't think they would get tough with a small business owner over $10,000 or $20,000. Also - likely a small business owner would have quite a few tricks up his or her steeve to keep wolves at bay. Staff should be paid first, suppliers second and CRA last. If this can be managed maybe the business can start up again. No promises it will run a profit ... I always wonder how restaurants can afford to invest hundreds of thousands of dollars on rennovations. Just think, paying off reno loans has to come out of profits. That's hundreds of thousands of dollars of profits straight to pay off loans, how can owner's draw pay from profit. Is there really really that much left at the end of the day? Also, vegans likely drink nice bottles of wine but do they drink lots of beer and alcohol (shots, mixed drinks, etc.) This is where there's a higher profit margin. Just saying ...!!!

2014 Jun 12
If this weren't a vegan restaurant would we be having this conversation?
I can't help but think there's a political aspect to this issue.

2014 Jun 12
Care to elaborate on what you believe the 'political aspect' is regarding Zen Kitchen and their money woes?

2014 Jun 12
I just don't think a bunch of carnavores would be that up in arms about their favourite steak house going under. I think there's more of a community attitude about this issue, for vegans, because there's a kind of philosophy that vegans adhere to that us foie gras eaters don't identify with.
Perhaps 'political' was a poor choice of words, but I find it interesting that this topic seems to have such traction.

2014 Jun 12
Just to add my two cents: I think there is so much support for saving Zen Kitchen because, as far as I know, it is the only restaurant that serves exclusively vegan dishes. (Some restos have vegan dishes as part of a menu which may include vegetarian and even meat dishes.) So it would probably attract a dedicated clientele for that reason alone. Also, Zen Kitchen makes some fabulous dishes which even appeal to some of us carnivores. Add to that the owner(s) have supported local farmers right from square one. So, over the years, they have attracted quite a fan base. Unfortunately Domus fell on hard times and had to close up shop barely making a splash in the news. Unfortunate but that's the way things go...

2014 Jun 12
Pasta Lover hit the nail on the head, and I agree with the people that want to keep it open. I just don't think he should be in the news saying he basically has no intention of paying CRA back until everyone else is paid and I don't think the very people who he took money from and didn't pay to the CRA are right in the head for giving him even more money.

The viability of the business is clearly not great, but the community surely thinks it's worthwhile.

Maybe I just feel this way because I pay allot of taxes.

2014 Jun 12
Surely there is room for at least one well run vegan restaurant in this city of Ottawa + Gatineau, of close to 2 million people.

2014 Jun 12
No, the Ottawa Gatineau CMA (a large large area) has a population of ~1.2 million. Your point is totally valid but the number is way off. :)

2014 Jun 12
Yeah you are right. 1.2M as of 2011. Maybe a bit more now.

www.cbc.ca

2014 Jun 13
For other vegan options, just down the road from Zen, is Cafe My House in Hintonburg.

Café My House


2014 Jun 13
What? Pay back CRA first? Did I really hear this Stuart S? I don't think he said that he wasn't planning to pay CRA ---- I wouldn't hold it against him if he pays employees first then suppliers. If he can do this and then pay CRA, he would be on the right track ... (at least IMHO)

We do need more places with vegan options ...

2014 Jun 13
If Dave Loan, Zen Kitchen, or anyone for that matter owes money to the CRA you have to pay ASAP - they are merciless... I used to work for someone who is a former CRA employee - she used to process income tax forms for individuals. She told me that when tax time comes around they review the forms to make sure they are complete and that all receipts are attached then process them. When tax season is over they do random audits on individuals and if you ever get a notice of assessment saying you owe money then you have to pay and they are NOT flexible. I imagine the same rules apply for businesses. If I were an employee of a business that went bankrupt for whatever reason and didn't get paid I would be upset too but the employees usually end up last on the list when it comes time to settling the finances.

2014 Jun 13
It may be symantics, but what people said in previous posts was that he wasn't paying CRA. Business owners collect tax on behalf of CRA.

So tax was already charged and collected when the food was sold, and it belongs to CRA, and CRA has a right to it.

It's not a question of him paying CRA first. It's the customers who paid the tax to CRA, and the business owner is only the collector of it on CRA's behalf.

In his case it's gone, whereas it should have been set aside to begin with, because it wasn't his.

At least that the way I'm reading it without looking at the accounts . . .

If the business is going bankrupt then it has no profit and ows no tax on profits. But it still needs to hand over the tax collected on CRA's behalf at time of sale.

2014 Jun 15
If he declares bankruptcy his employees may be able to get some of their money through the wage earner protection program (www.servicecanada.gc.ca), but it only goes back 6 months from the date of bankruptcy. The longer Dave waits, the less his employees would be able to get if the WEPP is a viable option for them.
The issue here isn't that some middle class couple bought themselves a restaurant, bungled it, and some vegans want to bail them out with donations (that's just depressingly hilarious). The issue is that a bunch of cooks, dishwashers and servers, who, by and large, make sub-poverty line level wages, are owed money that could make the difference between having to pay rent with a credit card and not having to pay rent with a credit card. It's disgusting, but not surprising.

2014 Jun 16
Well, I guess if people want to donate they can.

Everyone and their dog, is using "go fund me" for things they want or need it seems.

Some 92 year old lady I heard of took a trip, without travel insurance and injured herself in Korea and these people online donated around $30,000 to that.
I guess no one is making them donate- but still.

Maybe I need some dental work and phisio and should try doing the go fund me thing since I am uninsured and not able to work at the moment??
I think I only need a couple thousand for physio since it is around $50 per apt...

2014 Jun 16
Wow $30K. I guess you have to tell the right story.

I wonder if anyone will fund my lunchtime foodie addictions . . . . please ?