Cut-throat competition is a reality of the restaurant business. Considering that 60% of restaurateurs close within their first year, the million-dollar question is, “What’s the recipe for success?” Of course, a killer concept, quality cuisine, and stellar customer service are key ingredients, but there’s more to it than that. Sprinkle in smart strategy, careful planning, and tight management, and you’ll stack the odds in your favor. But to beat the odds — and even boast long-term success — you need to avoid these all-too-common pitfalls.
1. An unclear concept
As in any competitive market, it’s important to set yourself apart. However, don’t go overboard in your quest to be different. If you stray too far from existing restaurant categories, you run the risk of confusing customers or (even worse) alienating them completely. While it’s beneficial to have a unique selling proposition, your concept should be easy for consumers to understand. Once you’ve established your concept, commit to it, so your target audience is clear on your one-of-a-kind offering.
2. Lack of consistency
Even with the most compelling restaurant concept, you can’t build a loyal customer base without consistency. From the speed of your service to the integrity of your food, consistently deliver the same quality product so customers know what to expect. Realistically, there may be variables outside of your control, but take measures to guarantee consistency whenever possible. For example, use high-tech, reliable equipment to ensure reliable results and efficient cook times. And from a service standpoint, stick to an effective retention strategy to retain top talent.
3. Financial mismanagement
A clever concept and first-rate food will help you build your business, but to have staying power in the restaurant industry, you need to carefully tend to the financial side of your business. Maintaining positive cash flow (read: have more money coming in than going out) is critical to your success. How can you do that effectively? Keep a balanced budget and plan for upcoming expenses. Beyond careful budgeting, make smart purchasing decisions and invest in energy efficient equipment to make sure you have a healthy profit margin from month to month.
4. Undervalued employees
The restaurant has a reputation for a high turnover rate. But, it doesn’t have to be that way. If you show your employees you’re invested in them, they’re more likely to stick around for the long haul. From training to retention, spend the time and effort to show your employees they’re valued. Keep them interested from the get-go with engaging training tactics and encourage them to stick around by offering rewarding incentives. It takes a little work, but it’ll pay off in the long run. Not only will you save money, but you’re more likely to have a top-tier guest experience with a solid team.
Stay current on the latest dining behaviors to boost your success.
These tactics will help your business to stand the test of time, but while you’re implementing these strategies, make sure you’re capitalizing on changing trends. Check out these pointers to see how you can cash in on the latest dining behaviors.
