Opening a Restaurant? Prepare for a Bumpy Ride
Who hasn”t thought about opening their own restaurant? The idea of creating your own little world where people come to drink, eat, and laugh at each other”s ill-timed jokes is intoxicating. Everyone has an idea of what the perfect restaurant should be. Among some amateur insights we often overhear:
- “They need to hire more waitstaff.”
- “This restaurant needs to run more happy hour specials.”
- “Twelve dollars for an organic burger? That”s ridiculous.”
- “Why aren”t there more attractive waitresses?”
- “A thirty minute wait. This place sucks!” (although lines are usually an indicator of restaurant quality).
- “You know what would be sweet? If there were HD screens on the table so we could watch football while we”re eating.”
The restaurant industry is one of those things where everyone has an opinion. Just because you eat out a lot doesn”t make you qualified to run a restaurant. If you spend your whole day on a computer you”re not going to suddenly call Hewlett Packard and start offering suggestions on how to make their screens better or how to improve their track pads. Why do we feel the need to offer advice to waitresses and complain incessantly when we”re unsatisfied with our restaurant experience? Opening a restaurant isn”t as easy as people think. Here are some reasons why close to 60% of restaurants close within three years of opening.
You Need Money, A Lot of It
With the advent of online restaurant supplies stores it”s easier than it ever has been to . There”s no doubt that technology has played a huge role in making it easier to get what you need for your business. But don”t let the ease of online ordering trick you into thinking it”s as easy as browsing Ebay/Craigslist for used equipment and then “poof” you can start cooking. You need serious cash to start your own restaurant. Unless you have a trust find to kick around you”ll need investors. To get these investors you need a business plan. To put together a business plan you need to know about running a business. See the pattern here? Having passion for food and restaurants simply isn”t enough to survive in what is arguably the most cutthroat industry in the United States.
Where to Get Investors?
As cliched as it sounds, “it”s all about who you know”. Of course you have to have passion but associating with people who can put money behind it is paramount to the success of your restaurant. A great first step is to create a list of family and friends who”ve had experience in the industry, preferably one who”s had a management role. Your cousin Stevie who washed dishes at Olive Garden isn”t the best resource when you”re starting out. You need to convince the right people that you have what it takes to run your own restaurant. Join a local business organization like the Kiwanas Club or Chamber of Commerce. These people will steer you in the right direction.
Expect to Work All The Time
The image of the fat cat restaurant owner sitting back smoking cigars while cabana boys bring him margaritas is a myth. The restaurant owner is often stressed, overworked, and dealing with fifty things at once. Expect to put in 60-70 hours per week and prepare to work weekends and holidays (when restaurants are the busiest). Expect your “personal life” to take a hit. Good luck keeping together a healthy relationship when you”re worrying about how to replace your suddenly-sick general manager on a big game day. With so many balls juggling in the air it”s no surprise many people refer to the restaurant business as a “young man”s game”. While this may seem like a dichotomy because, “who”s going to give a twenty eight year old the thousands of dollars it takes to start a restaurant?” – it serves to illustrate the special kind of driven person it takes to make a restaurant a success a success.
Not a “People Person”? Leave That Mindset Behind You
Starting a restaurant isn”t like starting a consultancy. You”re dealing with physical products and many people in many different roles with real emotions and agendas. Your skin has to be thicker than a rhinoceros”. Among the people you”ll have to be dealing with: waitstaff, vendors, accountants, landlords, and most important of all, customers. The amount of patience required to deal with angry customers cannot be underestimated. Even if you think you run the tightest ship around there will always be someone ready to complain about seemingly mundane details. You can”t please everyone and you have to take even the most negative customer interactions as learning experiences. It”s a pure people business and your marketing plan and way you conduct your restaurant will be gauged by people. Customers drive the profit and the success of your restaurant will ultimately be judged the amount of people sitting down to eat.
“No Way? There are other people with the same awesome restaurant idea that I have?”. Yeah, there is. A lot of them. Unless you”re opening up a turnkey franchise like Taco Bell then you”re going to have a lot of research ahead of you. What is your competition doing? How are they marketing themselves? What are they doing wrong? While many seasoned entrepreneurs will tell you to “work harder” than your competition this simply isn”t enough anymore.
The competition-monitoring tools that exist online these days are absolutely essential. Chance are, any worthy competition will be using their website, social media, online coupons, and other digital channels effectively. Set up a “Google Alert(s)” for your competition. Explore how they”re being talked about in social channels and on the web. Mark down both positive and negative interactions and try to understand why they”re being mentioned in that manner. The hallmark of a successful, modern restaurant business is their ability to interact and respond to their customers. Social networks like FaceBook and Twitter are great ways to keep your ears to the “customer complaint” track.
Keep Your Head Up
Opening a restaurant business is tough. There”s no way around that. Only the best will succeed. In order to be one of the few long-term success stories you have to work “smart” on top of working hard. Utilize what modern technology has to offer. Streamlining your processes will ensure an efficient and cost-effective approach to operating your restaurant. Ask yourself, “do I really need this?” or “what options can I explore to make this task easier on me and my employees?”. Keeping an open mind and positive attitude throughout the process will ease your stress and give you a realistic attitude.