26 - 9 Common Reasons why Restaurants Fail

 We look at the reasons why restaurants fail.  To many Restaurants close, but we aren't talking about that kind of failure.  We are talking about the Restaurant owner or chef who don't have a Restaurant that is meeting the requirements of their personal plan.  

They are working too many hours. They aren't making enough money. They don't spend enough time with their family. They can't take time out from the Restaurant for a holiday.

That isn't good enough.  Running a small business is hard and stressful and running a Restaurant is one of the hardest and most stressful types of businesses.  Let's look at ways that can cause failure and ways that you can avoid failure and start being successful. 

1. Cashflow, leases, cashflow, understanding the P+L and the profitability hospitality metrics that you need to focus on.

2.  How to be objective about your Restaurant.  How can you use open and objective information about your restaurant to make it better.

3. Lack of innovation.  There are so many things that can be done in the Restaurant, POS systems, marketing, ingredients, Menu.  If you aren't continually innovating, you will appear dated when compared to Restaurants uses the latest techniques and technologies.

4.  Fitout.  What is the ROI of the fitout?

5.  Poor marketing.  

6.  No marketing.

7. Poor Culture.  Culture is a soft topic, it isn't reported in the P+L, so a lot of the time it doesn't get the attention that it deserves.  It impacts you, your team and your customers.

8.  Menu Engineering.  We look at some great Menu Engineering ideas and how it works in a real Restaurant, like www.noisyoyster.com.au, where the menu is costed, the wait staff know wait to recommend.

9.  Poor or no concept or Restaurant USP.

10. Burn out.  It is a really tough game.  It takes a toll.  What can you do to get the spark back and the passion that will shine through in bring the customers back in?