Best Business Tips for Restaurant Business Owners

One cannot think well, love well, sleep well if one has not dined well, says Virginia Woolf, a modernist 20th-century writer. We are sure no one will disagree with this statement. And when we talk about good food, we tend to turn towards restaurants. As it has been visible for a decade that the frequency of dining out in India has seen a tremendous rise.

Now, people do not sit and wait for the weekend to have a gala time at a favourite restaurant with their loved ones. Long gone are those days when people were seen dining out only on special days like birthdays, anniversaries, or other celebrations.

May it be a tempting South-Indian breakfast, a sumptuous Maharashtrian thali for lunch, a cozy cup of Irish coffee, or a 5-course fine-dine dinner, it has been a routine for one and all. And this dynamic change in the mindset of people has boosted the restaurant industry. Now when we state a restaurant, we do not precisely mean a lavish 1000 sq. ft. restaurant, it can be a tiny Quick Service Restaurant, a bistro, a cafe, or a fine-dine outlet.

Thus this ever lucrative industry has seen dynamic changes with the passage of time and has tastefully moulded itself too.

But we have also seen more than 80% of restaurants shutting down within the very first year of operations due to several challenges. Stiff competition, appreciating rent, quality control, human resource, etc., have been few reasons for the sudden closure. Thus it has become all the more important for restaurants to understand how to expand business in this competitive market.

To answer the question above, let’s get enlightened over some helpful business growth tips for restaurant business owners.

1. The Picture Perfect Locale

The location of the restaurant is pivotal in driving its success. One must pick and choose a place that has many passersby but must not be on a cross-road junction. If the restaurant is at a cross-road junction, parking might be a problem for the customers. The location depends on the type of restaurant. If it is a QSR, it can be on a busy street, outside a college or university. If it is a cafe or bistro, it can be on a calmer street with lesser traffic to give your customers a calm and relaxed ambiance. Thus the location is one of the most important small business tips that need consideration.

2. The USP

Brew that perfect unique selling point for your restaurant as it shall be one of the best business tips for you. It can be a star chef, a stellar dish, a reasonable price, an innovative menu, or the overall theme and feel of the restaurant that can drive the customers. All successful restaurants run on this principle of having created a USP to bring back their customers over and over again. The restaurant business owner must be in a position to give the customers a solid reason to return.

3. Cost Control

Every restaurant incurs fixed and variable costs in its operations. Fixed being rent, staff salaries, etc, and variables are electricity, raw material costs, food, and vegetable costs, etc. The trick is to ensure the restaurant’s smooth functioning is to optimize these costs without compromising on the quality. You can source the raw materials from a vendor that gives a good discount or choose a location with ample fresh air and light to reduce electricity usage.

The human resource costs too can be made dynamic based on the skills and requirements. A pro chef can be hired full time, whereas extra serving staff can be engaged only during rush hours. As only proper money management can heat up the kitchens and also warm up your pockets.

4. Watch your Inventory

Keep a close watch on the inventories of your restaurant. The inventory of your restaurant must run like a well-oiled machine. Make an automated inventory sheet that must be updated daily, weekly, or fortnightly in accordance with the size of your restaurant. The answer to how to grow my business lies in managing your inventory seamlessly.

You must make a list of slow and fast-moving items for your restaurant, considering the peak and non-peak hours. This will help you replenish the commodities without overstocking. Also, at times diversifying and introducing a special day menu based on the inventory available is a good quality of a pro restaurateur.

5. Satisfied Staff

While concentrating on the customers, you must not sideline the staff that is slogging it out for your brand. A satisfied employee spreads smiles, affection, and most importantly, the goodwill of your brand.

The food, decor, or pricing might be in place, but if you oversee the shabbiness of your waiters, rude behaviour of your staff, all of this might soon lead to the closure of the restaurant. To ensure the sustainability of the business, you must regularly train your employees for basic etiquette, body language, dressing, and overall image. As the hospitality industry relies predominantly on the qualitative service, you provide.

Expectations and responsibility work both ways.  Thus offer your employees competitive salary, health work conditions, ample leaves, and progressive career opportunities. This shall boost the staff productivity and increase your profits in turn.

6. Today’s Saviour - Technology!

With these tough times hitting hard on every industry big or small, the restaurant business has been no exception. Hence, embracing technology in every vertical of the restaurant business will answer your question on how to grow your business. Technology has turned out to be a boon in these rough times for everyone. Here’s a quick list of how you can employ the technology to drive success.

• Tie-up with online home delivery aggregators.
• Utilizing social media platforms for publicity.
• Building a powerful website for brand development.
• Installing automated ordering, billing, inventory, and operational system in the restaurant.
• Keeping a watch on the location through CCTV surveillance.

7. Customer is the King, Always!

However big your business is, always keep in mind that the customer is the king. And every king deserves a sumptuous meal, refreshing ambiance, friendly service, and a cost-effective menu. Thus, you must be in a position to provide this every single day.

Apart from this, a customer might not be friendly at all times. Hence, you must be prepared to face a demanding or a rude customer too, efficiently.

One can handle grievances in a polite yet innovative way by gifting free coupons, free-meal, passes to an event, flowers, or gifts, etc to calm down an irritated customer. These are some from those many small business tips that can help you sustain the aggressive market.

8. Document it

A restaurant has to undertake several licenses and approvals from government officials. Right from FSSAI to the local commissioner, every restaurant owner must keep a track of all the protocols and regulations in order to keep the operations proper. Non-adherence to these norms may directly lead to closure of the venture. Thus a restaurant owner must document all the papers in a structured and updated manner.

Become a critic for your own business and analyse your restaurant closely. Inviting mystery customers, other restaurant experts, or food industry professionals can help you understand your business in a better way. Just step into the shoes of your customers and look for yourself.

Accordingly, refocus, readjust, and reshape your lens to become better with each passing day. Last but not the least, strive hard with genuine effort and innovative ideas to transform your customers into patrons. Patrons that shall shower your restaurant with regular visits, valuable feedback, and genuine word of mouth publicity.

Also Read:

1) Best Business Tips for Supermarket Owners
2) 8 Business Tips for Wholesale Business Owners
3) Best Business Tips for Kirana Store Owners
4) OkCredit: All you need to know about OkCredit & how it works.

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FAQs

Q. Which food business is most profitable?

Ans. The most profitable business can be a tea shop or coffee corner. As it has less investment and more profits.

Q. Do restaurant owners make good money?

Ans. On an average, a small unit may earn around Rs. 50,000/- a year. At the same time, a larger bistro may earn a few lakhs in a year.

Q. What do restaurant owners struggle with?

Ans. Managing inventory and restocking is one of the most dreaded operations many of the restaurant owners struggle with.

Q. Why do most restaurants fail?

Ans. About 65% of restaurants close within the first year, the reason being improper location and mismanagement of capital.

Q. What is the average lifespan of a restaurant?

Ans. A median restaurant can survive around 5 years, but only hard work, proper money management, innovative ideas, etc. can keep the restaurant alive and kicking.