Every business owner lives in fear of failure, but for restauranteurs, this fear can be all too real. With almost 80 percent of restaurants nationwide closing their doors within the first five years of opening, the reality is that this industry is harsh and unforgiving.
If you’ve found yourself in dire straits and you’re unsure how to dig your restaurant out of its downward spiral, consider these tips and strategies.
Don’t Avoid Your Finances
If money is tight and your budget has been stretched too thin for far too long, it’s time to stop avoiding your financial statements. You’ll need to sit down and take a good, thorough look at your financial performance. Do you have too little money coming in? Could you approach an angel investor to help bail out your business? Perhaps there’s too much money going out; your lease is too expensive, or you’re paying too much to source ingredients that you could get cheaper elsewhere. It’s important to make changes now before an existing deficit or debt get any worse. Consider speaking with a financial advisor before making any big moves and see what you’ll need to do to get your business right side up.
Get Customer Feedback
If you’ve noticed sales are declining, you often have empty tables in your restaurant, and you’re not achieving the customer loyalty you’d like, consider the feedback available at your fingertips with just the click of a button. Check out customer reviews, and take notes of any criticism. Use Yelp to check out what’s already been written. What might be convincing customers to steer clear of your business. Ask in-store customers for some feedback or suggestions as to how you could improve their dining experience. Drastic times call for drastic measures, and transforming your restaurant practices to better suit your consumers’ needs. This is a surefire way to increase profits and keep your business afloat.
Enhance Consumer Volume
If you need to ramp up your revenue, you’ll need to seat more customers each day. This means turning tables quickly and efficiently, without sacrificing customer service that your patrons have come to expect. To turn tables quickly, there are a few strategies to consider. First, take a hard look at your menu. If it’s endless, with page after page of offering, your customers may be spending the bulk of their time at the table simply perusing the options. Paring down the number of options on your menu will expedite the ordering process. This will reduce the risk of missing customers unwilling to wait for a table.
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Consider Your Staffing Needs
It’s also important to always have enough staff on hand to handle orders and bus tables. If guests have to wait inordinate amount of times for their meal or check, not only will you deal with dissatisfied customers but you also may lose out on guests who walk out the door after waiting too long to be seated. Perhaps you have too many wait staff on hand; labor costs are a large part of restaurant expenses, and better managing your staff levels will help you save. Use a service like TSheets.com to enhance communication and better track employee hours. You’ll be amazed at how much you can save on a monthly basis by not paying employees to simply stand around.
If You Decide to Sell Your Restaurant
While many small businesses fail within their first few years of operation, this risk is heightened with a restaurant business. If you’ve decided to part ways with your business in order to get out of debt or rid yourself of the stress and worry, you may choose to sell the restaurant as a whole, or liquidate your assets one by one. This might meaning selling off your restaurant equipment, selling a license for liquor (which can often carry a price tag of thousands of dollars depending on the area), or selling the actual property, assuming you owned instead of leased. It can be hard to admit defeat, but considering the statistics stacked against restaurant owners, you’re in good company, and it’s important to retain perspective—there will always be another opportunity.
If your restaurant is failing, keep these considerations in mind and take steps to turn it around as soon as possible.
