A Cuban entrepreneur, the owner of El Kioskito Cubano LLC, a bakery and restaurant in the United States, took to TikTok to share valuable lessons she learned after starting her food business. Her goal was to guide fellow Cubans considering a venture in the culinary industry.
The video, released last Thursday, runs for six minutes and 35 seconds and was introduced by the owner as an educational tool rather than a complaint. "Things I wish I had known before opening my business, and this is educational for those wanting to start a bakery, restaurant, or any food-related business," she explained at the outset.
Unanticipated Tax Obligations
The first major surprise came with taxes. The entrepreneur admitted she was unaware of the requirement to report sales tax every three months. "We didn't know that as a bakery, we needed to report these taxes quarterly... and when we received the notification, it came with a small penalty, and we had to pay $1,500 in the first three months of opening our business," she recounted.
Delivery Challenges and Security Measures
A recurrent issue involves delivery platform drivers. According to the owner, some fail to deliver complete orders or tamper with the bags, keeping part of the contents, leading to customer complaints and negative reviews for the restaurant. "Unfortunately, once a driver picks up the order, they are responsible; the restaurant is no longer accountable," she explained. To counteract this, the business packages orders with security seals.
High Fees and Platform Approval Processes
The commissions charged by delivery platforms also pose a significant challenge. "These apps keep an absurdly high portion of our profits; they've been taking more than half. For instance, if we make $1,500 a week, they've been taking $600," she noted. When she reached out to DoorDash, they justified the fees as covering marketing and service costs.
Regarding the registration process, the entrepreneur detailed that DoorDash approved her application on the same day, whereas Uber Eats required more documentation and took a week to approve her.
Practical Advice for New Business Owners
Among practical tips, she recommended activating delivery apps at least 30 minutes before the actual opening time to avoid receiving orders before being ready. She also warned that if an order takes more than five minutes to prepare once the driver arrives, they can cancel, and the platform won't cover the cost of the already prepared order. She experienced this firsthand on a busy Friday when a driver canceled an order that took under five minutes because the place was crowded.
This Cuban entrepreneur's experience in Miami highlights the typical challenges faced by immigrant businesses in the U.S.: navigating tax complexities, relying on technology platforms with unfavorable terms, and the extreme multitasking required from the owner. The Cuban community has a rich tradition in the culinary industry, particularly in cities like Miami and Hialeah, where many Cuban businesses encounter similar entry barriers.
"I am the owner, the manager, the cashier, the cook, the baker, the cleaner, the organizer, the customer service representative—I'm everyone. And lastly, dealing with an employee who won't listen," the entrepreneur concluded, humorously and candidly summarizing the reality of running a small food business in the United States.
Key Challenges for Cuban Entrepreneurs in the U.S.
What are the common tax issues faced by new business owners?
New business owners often face challenges with understanding the frequency and requirements of tax reporting, such as quarterly sales tax submissions, which can lead to unexpected penalties and financial burdens.
How do delivery platforms impact small businesses?
Delivery platforms can significantly impact small businesses by taking substantial commissions, sometimes over half of the profits, and causing issues with order delivery, which affects customer satisfaction and business reputation.
What advice is recommended for managing delivery orders?
It's advisable to activate delivery apps slightly before opening to manage orders effectively and to package orders with security seals to prevent tampering by delivery drivers.