| A lot of time and money had been spent trying | | | | you already have. Yet many restaurant managers |
| to learn why restaurants fail. In truth, there are a | | | | allow unhappy customers to walk out, never to |
| lot of factors that contribute to a restaurants | | | | return. |
| success or failure, but there are a few things that | | | | Quality customer service starts with |
| can really destroy a food service business. If you | | | | management, and it is emphasized on a consistent |
| get these wrong, it doesn't matter how good you | | | | basis to the staff. Despite the training and talk |
| are with the other, smaller details. | | | | about customer service, if your staff doesn't see |
| Here are 3 big reasons why restaurants fail. | | | | it coming from management, they will never |
| These areas can make or break your restaurant. | | | | embrace the concept. |
| Failure to Control Food Cost | | | | In truth, there are usually several chances to turn |
| For most food service operations, food cost can | | | | things around with an unhappy guest before they |
| make up from 25% to 35% of your total budget. | | | | leave your restaurant. Many times it doesn't take |
| Along with your labor cost, this is the biggest line | | | | much to make the guest feel like their complaint |
| you have to deal with. Failure in this area is | | | | was heard, and that whatever was wrong is |
| probably the number one reason restaurants fail. | | | | getting fixed. |
| Unfortunately, many managers are not very good | | | | Many times, all your customer wants is to be |
| at controlling their food cost. | | | | heard, and to feel like you appreciate their |
| The first step in controlling your food cost is to | | | | business. If you kick in a free dessert on top of |
| learn how to cost out your recipes. That requires | | | | that, you probably will have a return customer. |
| going through each ingredient in the recipe and | | | | However, once they have gone, they will tell all of |
| determining how much it costs. When you add | | | | their family and friends about the bad service |
| the cost of all of the ingredients together you will | | | | they received. And bad press is a big contributor |
| know the cost of that menu item. | | | | to why restaurants fail. |
| Once you have the cost of the menu item, you | | | | Failure to Be Consistent |
| simply divide that cost by the number of portions | | | | Consistency is very underrated by many of the |
| the recipe makes. That will give you the cost per | | | | so-called experts in the restaurant business. They |
| portion. the recipe. Divide that number by the | | | | talk a lot about keeping up with the trends, |
| desired food cost and you will get the price you | | | | proper menu design, decor and ambience, and |
| need to sell that item for in order to hit your food | | | | many other factors that can help distinguish you |
| cost. | | | | from your competitors. |
| For instance, if you want to run a 35% food cost, | | | | While all of these are important considerations, |
| and the portion costs $2.50 to make, you would | | | | these are not factors that typically are |
| divide $2.50 by 35% for a selling price of $7.15. If | | | | contributors to why restaurants fail. However, |
| you sell that menu item for any less than that | | | | being inconsistent will keep customers from |
| and you will not hit your food cost for that item. | | | | returning to your restaurant, and that is a definite |
| The second step in controlling your food cost is | | | | reason why restaurants fail. |
| to control the amount of waste in your operation. | | | | Your customers know what they like. If they love |
| Selling items for the correct price will not do you | | | | your pasta sauce, they will return to your |
| much good if you are throwing food away, or | | | | restaurant over and aver again for that sauce. If |
| your employees are eating or stealing your | | | | they come back to find that the sauce is |
| profits. | | | | different than they remember, they will leave |
| One way to minimize the amount of waste is to | | | | disappointed. You may get one more chance to |
| make sure your kitchen staff uses a waste log. | | | | redeem yourself, but if it isn't right, they will not |
| Any food item that gets thrown away, for any | | | | come back again. |
| reason, must get written into the waste log. By | | | | There is a temptation to make changes to your |
| tracking what gets thrown away, your staff will | | | | ingredients and portion sizes during difficult |
| begin to pay closer attention to how they handle | | | | economic times. It is understandable to want to |
| the food in your restaurant. | | | | save where ever you can, but you need to |
| You also need to examine your food storage | | | | understand the risks when you make changes. |
| procedures. Make sure that your stock is being | | | | Customers want to go where they have enjoyed |
| dated and rotated when it comes in off of the | | | | the food in the past. If the food they remember |
| delivery truck. Put all of the new items on the | | | | is not that same as they remember, you could |
| back of the shelf and move all of the older items | | | | easily lose a customer. |
| to the front so they will get used first. | | | | There are many different reasons why |
| Failure to Focus on Customer Service | | | | restaurants fail. If your are serious about |
| The second big reason why restaurants fail is | | | | restaurant success, make sure you focus on |
| poor customer service. Research has shown that | | | | these three areas. Once you have them down, |
| it takes a great deal more money to attract new | | | | you can be making money while you work on the |
| customers than it does to keep the customers | | | | other things you need to know. |