A restaurant’s success depends on a variety of factors. Tying these individual attributes together in a natural feeling way is what separates a dying business from a thriving business.
Attached is a test you can take to gauge what improvements can be made to your restaurant. Improving your concept with these guidelines in mind, is a sure way to create a more successful business. Auditing your business will help you find areas of focus for improvement strategies.
Make sure to be honest with yourself. After all, your restaurant is like your baby, and everyone’s baby is perfect ;) but unlike a human, a business can be judged objectively. It’s easy to be blind to your own weaknesses, and this self assessment is no place to sugarcoat the facts. Check your ego at the door. If this is too difficult, think about asking people you can trust to be honest, for their participation on the test.
This is a weighted test with emphasis on the more important categories that determine a restaurants financial success. The categories are as follows:
If you have any questions regarding the test do not hesitate to email me!
For many restaurateurs, choosing the right social media platforms, creating content, and executing successful campaigns can seem like a never ending job, which requires a dedicated team. There are more social media platforms than ever before, and attempting to stay relevant on them all will only water down your intention.
As a business owner, it’s important you focus on achieving maximum results for a minimum amount of effort. You probably already understand the Pareto Principle which states:
"For many events, roughly 80% of the effects come from 20% of the causes.”
This concept is important when implementing an affective restaurant social media strategy. If used appropriately, this concept can increase your ROI on social media.
Some known examples in marketing using this principle include:
Using Pareto’s Principle on social media, one should focus energy on Facebook and Instagram. Facebook and Instagram are the restaurant industry leaders in social media, and narrowing focus on these two platforms is a great way to steadily grow business (Facebook and Instagram are the 80% in this example).
Facebook is the largest social media platform in the world and currently has around 2.23 billion monthly users. Facebook is a great platform to convey the message of your brand since users are keen to learn about your story and values. Blog posts do great on this platform and are highly suggested for redirecting visitors to your website. Older audiences are more likely to be using Facebook as opposed to other platforms which makes it a solid all round platform to focus energy. On the other hand, Facebook is a poor platform for growing exposure and a fanbase. Facebook will be your weakest performing platform. This is why balancing Facebook with it’s other sibling is a great combination.
Instagram (now owned by Facebook) is ranked 6th in the world for photo sharing apps and has around 1 billion active monthly accounts. Instagram is best for sharing beautiful photographs of products and food! Using hashtags on instagram is a great way to target interested customers. A branded hashtag can be used in a unique marketing campaign and can simply be the name of your business or a slogan/tagline. Instagram appeals to a younger audience and is often viewed as entertainment. Since Instagram is entertainment focused, this is a great platform to gain an audience and keep viewers up to date with what is new at your restaurant. The platform’s geotagging ability is also being used by travelers as a guide to find restaurants/things to do when they are abroad.
Although this strategy will primarily focus on the above two platforms it’s important that we maintain consistency across all platforms. The other primary platforms include Google Business and any review sites like Trip Advisor. Since my restaurant (Warung Falafel) is based in the tourist economy of Bali, Indonesia my focus is on Trip Advisor and Google reviews. This will differ depending on what platform is popular in the geographical location of your restaurant. In the United States, Yelp will be the platform to consider. Ensuring that these listings are consistent with all other platforms, will increase the frequency your restaurant shows up in customer search results online (SEO).
In summary, Facebook and Instagram should spark the question from guests: do I want to try this restaurant? Much of the time, these guests will seek the answer to this question by viewing your credibility online (reviews).
The ultimate goal for restaurants should be to create a stellar guest experience, which entices current customers to leave positive reviews online. Once this process is running, social media will be most effective in funneling interested guests to your website and review platforms so a decision can be made.
A restaurants social media strategy should always begin with a quality guest experience, so before implementing the above strategy, make sure to read my other article "WHY SERVICE COMES BEFORE SOCIAL MEDIA.” "The best social media execution in the world combined with a poor guest experience would only speed up the demise of your restaurant..."
The restaurant business is a notoriously difficult one to do well in. It takes a lot of work and the margins are slim. You have to be a certain type of person to want to be a restauranteur. However, if you work hard, have a great concept, and implement efficient systems your bound for success.
The above graphic is a general breakdown of costs for the food industry. Obviously these percentages vary depending on your concept and particular situation, but these numbers are a good starting point to consider when organizing your restaurant.
According to the National Restaurant Association, independent restaurants have a profit margin of around 4-5%. In contrast, chain restaurants profit margins range between 10-12%. There is an average difference of 8.5% when comparing the food and beverage costs of these two styles of restaurant. This can largely be attributed to the fact that chain restaurants have more resources and therefore better inventory and food systems in place. Therefore, food costing is perhaps one of the most important factors to consider when trying to increase your profits.
When addressing food costing, it’s important to realize the difference between “ideal” and “actual" costs. Ideal costs are what the cost should be, if executed perfectly. Actual costs are what the cost actually turned out to be.
The formula for “actual” food cost is as follows:
Often times the difference (cost variance) between “ideal” costs and “actual” costs is about 9-10%. It is possible to decrease this difference by addressing the following:
If you address each of these issues, you will be on your way to increasing your margins and running a more efficient operation. The results that chain restaurants achieve are available to everyone if you put the work in to managing your costs through the implementation of systems. Although systems require diligence to implement, once they are working your life will be much easier. The goal is to create systems that work, so you don’t have too!
Social media’s potential to effectively capture customers is huge. Advertising has never been so readily available to the small business owner and as such, restaurants have no reason not to utilize this amazing tool. Although social media is necessary in this day and age to attract and retain guests at your restaurant, it's important to pair this marketing with a quality guest experience. The best social media execution in the world combined with a poor guest experience would only speed up the demise of your restaurant.
With the variety of restaurant options available to our guests, it’s important to understand that guests want more from their eating experiences than a tasty meal. One of the best ways to ensure a quality guest experience is by implementing guest service training. The importance of service to our guests can be seen in the following statistics:
After understanding the importance that service plays in our guests decision making, we can than devise a guest service strategy. Once implemented the strategy will ensure first time guests become loyal repeat customers who advertise on your behalf through word of mouth.
The best way to start formulating your strategy is through writing out (as detailed as possible) your guest experience before you even start construction on your property. This will help you create a concept which can be tailored to your guests experience from building design, to marketing, to team training.
A guest experience should be considered from the first point of contact a guest has with your business. For some, this might consist of a guest calling your restaurant for a reservation, or walking by on the street. For many, the first point of contact will be through social media or company website. In all of these scenarios the restaurant owner should consider all paths a guest will likely experience before, during (checkin/host interaction, table greeting, music…), and after (guest satisfaction email, customer review, word of mouth referral…) an encounter with your restaurant. Not only will this process help you create a team training guide, it will also help you fine tune your concept and uncover/resolve potential issues you never thought of previously.
The ultimate goal is to create a die hard, repeat customer who will spread the quality of their experience at your restaurant to everyone they meet. This word of mouth encounter will funnel more guests through your doors than social media could ever do. The combination of this outcome and a quality social media strategy is a sure way to increase your restaurants sales.
Sky's experience in the restaurant industry started when he was a kid growing up in his families restaurant. His journey took him to Bali, Indonesia where he now owns a restaurant and consults for others.