A new competitor down the street is taking your business, or a new traffic pattern rerouted regulars across the street. When business is quiet and negative reviews abound, a lot of restaurant owners start making impulsive decisions. They constrict their hours, cut their menu, reduce portion size, increase prices, and may even decide to close their doors.
Nobody wants to give up, but when it gets slow or you run into supply chain problems or you have trouble hiring, there’s a fight-or-flight response that comes out in the best of us. Before making any rash decisions, there are steps you can follow to identify the root cause of your issues, take action, and get creative to save your business.
Gather reasonable feedback
Good restaurant triage begins with listening. As an operator, you have powerful feedback mechanisms at your disposal. Your servers, bartenders, cashiers, and cooks will all have a perspective on the restaurant’s challenges. Not only does your team have insight from their professional training, but they also notice patterns in guest feedback. Listen carefully. When you receive feedback from within your four walls, this is an opportunity to investigate, identify problem areas, and create solutions with your team — solutions that have a real chance of being productive because you have team buy-in.
While you can gather a lot of information from inside your restaurant, it’s important to be attuned to the conversation outside, too. Guests take to Yelp, Google, and even Reddit to write about their experience. You should also set alerts so you can monitor what’s being said about your restaurant elsewhere online. While there are always going to be trolls, in every review there’s a grain of truth. Reviews reflect a guest’s experience; it’s your job as the operator to investigate their comments and learn whether there is any validity to that experience.
Don’t work harder; troubleshoot smarter
Once you’ve tapped your staff and combed through reviews, you can start to find the right solutions. Addressing a lot of these problems comes down to mental toughness. Change begins with the leadership team. First things first, put your ego aside so you can tackle these very solvable problems.
At the most basic level, you need to consider the price/value perception from a guest’s point of view. Guests leave every experience with the question, Did my visit meet or exceed my expectations? If for any reason the answer is no, you have a price/value issue. This is one of the leading causes of decreasing revenue. Expectations not being met could stem from inefficient service, inadequate staffing, poorly executed recipes, or even outdated décor.
Décor is an interesting conundrum as it is something often overlooked because of the inherent cost of renovation. Restaurants should budget for a refresh every three to five years. Décor that is not on brand is also an issue — a classic Irish pub shouldn’t renovate to look ultra-modern.
Operators need to bring together convenience, exceptional service, and food that is memorable. By doing so, you are able to create an amazing experience for your guests. In today's environment, that is what every guest craves.
If I go to a coffee shop and get the same drink made five different ways from three different baristas, there’s a training problem. A strong training program equips your team so they can perform their duties and responsibilities consistently.
Chain restaurants are successful because they have systems and structure. Checks and balances indicate to the higher-ups how well everybody is performing, whether financially or operationally. Many managers think they are training people, but they need to look at how they validate whether employees have learned and retained the material. Training manuals and systems are not a place to cut corners. They provide consistency and improve restaurant work culture. If you have a manager snapping at one bartender for mixing a martini the same way they saw the manager’s favored bartender do it, they may feel slighted or not respected. Playing favorites is one sure way to alienate the rest of your team. Alienation leads to discontent, discontent leads to people leaving to find other opportunities with companies that truly care about each team member. In short, this leads to employee turnover.
Staffing issues lead to a myriad of other issues and cause owners to change their approach in day-to-day operations so that they are manageable and not too overwhelming. Struggling restaurants end up constricting hours of operation in the hope of spending less money on cost of goods, utilities, or payroll. Constricting hours is rarely the solution to improving profitability. Focus on what’s contributing to the issues and look to correct those items.
For example: Look at the side of the road you are on. If you offer breakfast and your guests have to cross the road to get to the highway, they might opt for a more convenient option. This may not speak to your concept or how you execute; it may be something as simple as that you are not convenient for what the guest needs at that moment. In this case, look at traffic patterns and determine if a change of focus is in order. That might mean looking at dinner options, whether dine-in, takeout, or meal prep, which could be an easy pickup option for your guests as they head home. Ultimately, it could lead to a conceptual change.
However, before jumping into a conceptual change, identify if the service style is causing the disconnect for your guests. If you are on the “wrong” side of the road for convenience/quick service, could changing service style to full service ease your pain? Quick service is just that, getting people in and out as fast as possible so that they can continue on their journey quickly. If you can attract guests who have time to linger, a full-service approach may be the solution.
When a restaurant is struggling, one common issue is that operators will start purchasing lesser quality ingredients. They cut portion sizes and keep prices the same. When they do this, their price-value perception vanishes. If problems reside in efficiencies, purchasing, or menu development, tap into your state restaurant association as they have many resources at their disposal. If you want to improve your cocktail or wine program, your distributors likely have people who will educate your team and improve or update your program. Need help creating a new dish in your kitchen? Many large distributors have chefs who you can work with to identify which of their products you should be carrying.
Reaching your patrons through better marketing
In the old days, it used to be true that if you build it, they will come. Not so anymore. Unless you’re really established, patrons forget about you as soon as the next restaurant opens. However, you don’t necessarily need to call up expensive resources to get people through the door. You can begin with a simple audit of your online presence. In 2023, does your website still advertise its COVID restrictions from 2020? Do the website, Google, Instagram, TikTok and Facebook promote different hours of operation? If you’re keeping staff until 11 to serve an innovative late-night menu but your website says you close at eight, no wonder nobody is enjoying it.
Contrary to what most marketing professional might say, you should be posting on social media 14–21 times a week. This content needs to be channel appropriate. Each platform is different. The Facebook demographic checks their feed maybe once a day over their morning coffee, but the faster-paced Instagram crowd is more likely to see that late afternoon post teasing the night’s special. If social media seems like a daunting hurdle, there’s no shame in asking a peer with a strong presence who they use.
Through all of this, one thing should be clear. Don’t be afraid to ask for help. Know yourself and your skillset. The first step to resuscitating a struggling restaurant is to listen — to your patrons, to your servers, to the experts.
AUTHOR BIO
Mark Moeller is the founder and president of The Recipe of Success, a national restaurant consulting firm. Prior to starting The Recipe of Success, Moeller worked with independent and chain restaurants and in corporations focused on all aspects of foodservice, from supply chain management to franchising. He’s also an operations expert and turnaround specialist with deep expertise in the restaurant industry. For more information, visit RecipeOfSuccess.com.
