squareconsulting | 12 Grave Mistakes of Restaurant Owners!!!
Franchise, Restaurant, Consulting, Consultancy, Hospitality, Marketing, Branding, Advertising, Operations
portfolio_page-template-default,single,single-portfolio_page,postid-163,ajax_fade,page_not_loaded,,qode-theme-ver-7.6.2,wpb-js-composer js-comp-ver-4.6.2,vc_responsive

12 Grave Mistakes of Restaurant Owners!!!


20 November

About This Project

We see a lot of new restaurants coming up in our cities now a days but the worst is when a lot of them shut down their operations owing to the losses they incur due to some really nasty circumstances. These include staff issues, lack of sales, sudden quality deterioration, overall lack of management and many other reasons. To be honest, in the true sense the reason for the failure of these businesses is not as Macro as we think it to be, rather mostly the reasons for the businesses shutting within say 24 months of the launch is largely owing to some mistakes made by the owners of the business, some really GRAVE Mistakes to be precise! Well, I have compiled some 12 major ones to start with, you can also give your inputs as the more we understand the problems the better we find the solutions.

12 Grave Mistakes of Restaurant Owners!!!

  1. We don’t need professional staffing – It’s a fair kind of argument put up by most of the restaurant owners, they state that the professional staffing solutions are not for them as there are very less people available in the industry and there is a lot of snooping and poaching (pun intended).

  1. Who needs marketing? I don’t need to market my startup – Well. The most common reason for restaurants not faring well in recent times has been not being able to market the restaurants to the target audience. Going deeper, we see that the marketing segmentation and targeting is absent from the businesses from the initial stage itself and this leads to lack of correct marketing efforts and finally, the fall of a freshly started business.

  1. The Customer doesn’t know anything – This is a common misconception that is prevalent in the industry and almost all the startup restaurant owners suffer from this delusion. As a result, they start up with business models that do not have a market and the same leads to the closure of the business.

  1. I don’t have to communicate with the customers’ ­– The biggest and most successful restaurateurs also make it a point to talk and interact with their customers and take their feedback, the customers are the life of the business and communication is everything. The lack of communication in a business as dynamic and competitive as hospitality and food service can be lethal to the business.

  1. I don’t need to collect consumer data – Most of the restaurant startups do not realize the importance of the customers in building the decision around a concept for the business. This is more like setting up the foundation of your business on a swampland. The future of a baseless business is doubtful even before the business starts. You can avoid it! Try and analyze what is the need of the market and build a business in accordance.

  1. We are truly original! (And utterly rigid) – Being original is a different thing but being rigid about the products and innovation part is not cool. The reason I am saying this is because it is not at all bad to learn from competition and being inspired is not directly copying and pasting some products from competition on to your own menu but to get a concept and give it your own twist or creativity. Ideas are always welcome for a business that wants to stay updated and fresh for a longer part of its life. Even big restaurant chains have cross referenced menu lines and look for cutting into each other’s product development with a little sense of creativity and flamboyance.

  1. I am not concerned or bothered with my numbers, that’s my accountant’s job ­– Come on! This is one of the lamest ways of saying “I don’t give a Damn!” which is the worst thing that the owner of a business can do to the business. Checking up on your numbers and making some calculations doesn’t make you any less of a visionary; instead, it will give you a far more clear picture on the performance of your business (Like Cost of goods sold, ROI, Gross : Net Profit ratio etc)

  1. My business doesn’t need promotions, offers or loyalty programs – Forget the times when word of mouth used to be everything, those are medieval times in comparison to now. Today’s customer is smart, choosy, moody and above all – Looking for a great deal! Yes, The customer is more powerful than ever and the result of this phenomenon is that the customer now looks for more and more reasons to critique your strategy, your methods and your business. Let’s try and give him fewer reasons to be against you and more reasons to be for you. Tools like promotions, offers and loyalty programs will definitely help you get things straight with your beloved customers.

  1. I am in the Food business when I run a restaurant – FALSE! You are not just in the food business, you are in the customer service business, you are in the hygiene and safety business and above all – You are in the glamour business when you run a restaurant. Nothing else takes as much of a toll on an individual than running a restaurant, but never forget that it is one of the most profitable and fulfilling business too!

  1. Blah! Who needs social media ­– This is the information age and the impact of social media has never been more. Even in a country where there is lack of basic infrastructural facilities, they have social media. The impact of social media is something that simply can’t be ignored. Instead of that, the power of social media should be harnessed in the correct way (creating engaging and interactive social media campaigns and communicate better with the customers)

  1. Reviews! Who reads them? – Reviews, whether good or bad, have a definite impact on the business so the simplest way around is to revert and respond to criticism (good or bad) in the most composed and practiced manner and make sure that the communication gets an impact.

  1. Competition is the enemy – We are not on the battle front with our competition, and it’s a good thing to know your competition and discuss mutual avenues for growth and development for the overall business. You might be surprised to see the results of small steps like monthly competition meetings and strategy formulations on the basis of discussions and talks with other restaurant owners in the neighborhood. Tools like cross promotions and offer clubbing also work big time.

If you are an existing restaurateur or planning to open one yourself, do consider these as somewhat of a heads up for yourself. Further, if you have any requirements for developing your brand or expand an existing brand through franchising, do feel free to get in touch with us.