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January 21, 2015

6 Ways to a Successful Restaurant Business

The popular notion is that if you have good food to offer, success in the restaurant business is yours for the taking. This is not always the case. The food is only the product and it has been shown time and again that products alone, no matter its quality or desirability, do not always guarantee business success. As in other types of enterprise, the restaurant business requires an amalgam of factors to be able to hit the big time.  

Here are 6 ways to make a success of that restaurant business you have long planned to embark upon:

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#1 Never start without the big three. The big three are a great chef, a great location, and a great concept. These all work together. Your location should fit your concept. Your chef or “talent” must fit this concept otherwise your restaurant’s cash register will not be ringing merrily. It’s foolhardy to say location doesn’t matter because you have a destination restaurant. Location is everything. So do some research on a target area and understand what local patrons are missing and ask yourself if you can fill that void successfully. The restaurant should be in a busy location with a lot of parking.

#2 Always overestimate your capital needs. Plan on capital expense that would last six to nine months before you can break even. Many start-up restaurants see a major downswing in business after the opening’s initial excitement. That’s when capital is critical. You have to wait to see if the restaurant would really catch on. A lot of restaurant owners start out with cash in reserve and start blowing it because they think the honeymoon phase will last forever. That’s why most restaurants go out of business. So never let initial success go to your head. Success is only determined years later.

#3 Don’t get cheap with guests. The most important money you will spend is money that adds value to the guest. Don’t try to go cheap on certain things like equipment, valets, and even desserts. This is short sighted because everything that touches a guest is important. Bear in mind that guests love it when a dish comes out and the server says, “The chef wanted you to try this.” This creates a real connection and makes the experience more personal. Hence, make sure you spend as much money as possible on the guest experience. Spend money on the people already in your restaurant because that’s the best way to generate positive word of mouth.

#4 Focus on organization and systems of operation. Failing to put systems in place is one of the biggest mistakes an independent restaurant owner makes. Many restaurant owners don’t want to come across as a corporate entity on the belief that this would make their diner impersonal. This idea is misplaced. Developing a system will make your restaurant build guest demand, hold on to key people, and make money. Otherwise it would have been impossible to open two locations. Organization gives you the freedom to be creative.

#5 Be ready to evolve. Many businesses are started by a craftsperson with an idea for a product. Rarely does that idea become anything unless that person partners with someone with a complementary ability, like, “You carve wooden bananas and I can sell them for you”. That’s when an idea becomes a business. So always look for people who are smarter than you. As a restaurant owner, the smartest thing you can do is partner with people who know things you don’t—and then give them a reason to care.

#6 Acquire experience in all areas of the restaurant business. Again, this is so you can understand and appreciate the responsibilities of your staff, and also so you can motivate and guide others effectively. Dish washing, waiting tables, and bar-tending are some of the positions you should undertake. You need to know how to perform every position in your restaurant so you can both train new staff members if necessary and know when a staff member is misinforming you.


SEE ALSO: 10 Best Restaurants Worth Visiting in Essendon North, Melbourne


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  2. Gregory Grookett here from the United States and I see so many restaurants fail because they should of read an article like this. Good eateries are hard to find over here especially in my area.

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