A New Restaurant

Anyone that has actively marketed their restaurant knows that attracting new customers can be very expensive.  I’ve seen some claims that it is more than three-times as expensive to bring in a new customer than it is to keep an existing customer.

So, after spending the money for your restaurant marketing campaign, what are you doing to convert those new customers into returning customers?

The first step is to train your staff how to treat customers correctly.  Don’t think that your servers will automatically understand the importance of getting customers to return.  A lot of your servers are pretty short-sighted.  They are more concerned with today’s tips than they are in building your business.

Many servers have a tendency to see a coupon as a tool that will cause them to get a smaller tip.  As a result they will not give coupon customers the same attention they would give a customer that pays full price.  The result is that the customer will not be made to feel special, and they are less likely to return.

Make sure you are aware of what is going on in your dining room, and that your servers are treating all of your guests the way they deserve to be treated.  Remember, great food alone will not guarantee the success of your restaurant. If you want customers to return, you need to make sure that they feel special.

Have you heard the buzz about newer restaurant marketing programs like Restaurant.com and Groupons.  They’re are the hot new thing, but befoer you rush out to sign your business up, you need to be aware of what you are getting your restaurant into.

These site will set up a page for your restaurant, and your customers can go to that site and purchase coupons that can be used at your restaurant, usually at a big discount.  For instance, Restaurant.com lets your customers buy a $25 coupon for only $10.  Groupons is set up for a $12 for only $6.

The big attraction for smaller restaurant operators is that you can get your brand out to new customers without having to shell out money up front.

There are some big differences in how these programs operate, and that can impact which program you decide to use, or not use.

Restaurant.com

Restaurant.com ha been around for a little while, and they are pretty well established.  You sign with them for a 1-year contract.  They set up a site for your restaurant that includes pictures, your menu, and a link back to your website.  They let you offer several different coupons, all sold to your customers at a discount.  The most popular seems to be the $25 coupon.

The drawback to this program is that all of the money generated by the sale of the coupons goes to Restaurant.com, not to you.  You will make your money by upselling over the $25.

When the customer uses the $25 coupon they are required to purchase a minimum of $35 worth of food.  There is also a built-in 20% gratuity charge that is added on to their bill.

the idea is that you can do a great job serving the customer that they will be regular customers, even without the coupon.  There is a limit on how often a customer can use a Restaurant.com coupon at your restaurant, so they cannot show up every week with a new coupon.

Groupons

A newer program that has been gaining in popularity is Groupons.  This program is a little different because they only run the offer for your restaurant for one day.

The program is built on a large mailing list that daily gets sent the offer of the day.  You decide what your offer is going to be.  For instance, when I ran a Groupon offer for my restaurant we offered a $12 coupon that sold for $6.

Where Groupon differs  from Restaurant.com is that Groupon splits the revenues with you.  When the customer spent their $6, we received half of that money.

Another difference is that there are no limits on how many Groupons a customer can buy, or how often they can use them.  While it states that they can only use one at a time, there is nothing that would prevent them from returning to your restaurant the next day with a new coupon.

When I looked over the purchase records for Groupon I saw that the majority of the people that bought a coupon purchased more than one; some purchased as many as 4 coupons.

For my experience, I found the Restaurant.com program to be more profitable for us.  We have had return customers that came to us originally because of the coupon.  So far, that hasn’t happened with the Groupon customers.

We also saw more profitability with Restaurant.com.  Many of the Groupon people did not spend much above the value of the coupon.  On the other hand, the restaurant.com customers tended to spend more than the $35 minimum.

Both programs have their advantages and disadvantages.  What they do provide is a way to get your name and menu out in front of new customers without haveing to spend any restaurant marketing money up front.

Check them out and see which program works best for your restaurant.

Is your marketing staying true to your vision for your restaurant?

How do you define your restaurant?  Are you beating your competition on price? On service.  On quality of food?  There are a lot of restaurants that see themselves as providing better food and service than their competition.  Their menu prices reflect that they are not willing to compete on price.  They adopt the philosophy that you charge what the food is worth.

That is a great place to be, and it is a philosophy that I adopted with my restaurant.  The problem comes when these restaurants take out advertising.  Suddenly their message changes to “clip our coupon and come eat at bargain prices.”

Don’t get me wrong.  I’m not against coupons.  My wife and I use coupons when we go out, and I have run them for limited marketing campaigns at my restaurant.  It is a great way to get new customers in to try you out.  Just be careful that you are not running them so often that suddenly your entire customer base is the bargain hunters.

The majority of my restaurant marketing is focused on building my brand.  I really hammer home who we are, what we offer, and also let people know about any featured menu items.

Before you submit your next ad, take a look at your restaurants focus and then make sure your marketing message supports your vision for your restaurant.

As the economy continues to struggle, many restaurants have had to deal with a shrinking profit line.  That may mean looking beyond your traditional business model, and starting to look for more ways to generate income.

One popular choice is to attract more catering sales.  For a restaurant catering does not mean going on-site to work the event.  What it typically means is providing bulk food items at a reasonable rate that could either be delivered, or picked up at the restaurant.

Another popular route is to market a carry-out option.  Your customers could call ahead and have the food ready when they arrive.  This allows them to stop by on the way home from work and be able to enjoy a meal with their family without all of the fuss of preparing the dinner themselves.

Whatever option works for you, the key is to look beyond what you are currently doing in order to attract more customers into your business.

Is your restaurant a sanitary food environment, or is it merely clean?  It is an important distinction, and one that successful restaurant managers need to be aware of.

Clean means that the area is free of dirt.  Sanitary means that it is free of dangerous levels of germs and pathogens.  If you sweep and mop a floor it is clean, but you still probably would not want to eat off of it.

Why?  Because it is not sanitary.

As a successful restaurant manager you want to make sure that the food contact surfaces in your restaurant are both clean and sanitary.  That means that you need to have good cleaning and sanitization procedures in place, and you need to inspect the work to make sure that it meats your standards.

The difference between clean and sanitary is a distinction that many people miss.  Because they don’t see dirt they fell like everything is OK.  The problem is, your eye can not see the germs that may be crawling all over the surface.

For instance, suppose your cook was cutting raw chicken on a cutting board.  When he was done he wiped the cutting board and the knife with a damp rag and then started to prep vegetables for tonight’s salads.  Because he wiped the surface it appears to be clean, but all of the pathogens from the raw chicken are still crawling all over the knife and the cutting board, and those germs are now contaminating the raw salad veggies.

On the other hand, your customers may freak out over a bit of food that was stuck to the tine of their fork.  However, because that fork went through a high temperature sanitization, the fork is sanitary, even though it is not clean.  The customer has a much greater chance of getting sick eating the contaminated salad then they would by using the dirty fork.

Your restaurant should establish a policy of having pails of sanitizing solution available, and ensuring that your staff use that solution.  Every time your cooks move from one task to another they should get into the habit of sanitizing their area.  When you servers are bussers wipe down a table they should do it with sanitizer.

It is a very inexpensive way to reduce the chances of a food borne illness outbreak in your restaurant.  You can use a bleach solution that is 50 to 100 ppm to get the job done.  That is about a capful of bleach for every gallon of water.

Don’t worry about everything smelling like bleach.  At that level of concentration it should have no odor.  In fact, if you smell bleach you have it mixed too strong.  A proper concentration will have no smell and it will not leave an after taste on the surface.  It won’t even stain your clothes if you get splashed.  And bleach is one of the least expensive sanitizers you can use.

As a successful restaurant manager you need to make sure that your restaurant is not only clean, but it is sanitary as well.  Teach your staff to sanitize their areas, then inspect to make sure they are doing it right.

Many times the difference between restaurant success and restaurant failure is in the small details.  Your restaurant can have a very talented chef that consistently puts out excellent meals, but if that meal is served on a dirty plate, your potential success becomes a failure in the eyes of your guests.

I’ll admit, one job I have never held in my food service career is dishwasher.  That doesn’t mean I haven’t washed my share of plates and scrubbed more pots and pans than I care to remember.  Even in management and chef positions I have always been willing to step in and work through a pile of dirty dishes.

In most operations the dishwasher is the lowest of low on the pecking order.  Every crap job that needs to be done seems to fall to them.  It is your basic entry-level, low skill position.

That being said, in many ways your restaurants success rides on the back of these kitchen drones.  Read the rest of this entry →

Todays post is from Greg McGuire at The Back Burner blog.  I hope you find it as interesting as I did.

Small independent restaurants have been dropping like flies over the past year.  Chances are, if you’ve made it this far through the recession, the worst is behind you.  That doesn’t mean tough days aren’t ahead, but hopefully you’ve at least stopped just trying to stay above water and have started swimming a little.  The waters out there are still dangerous, but if you’re not thinking about growth, you’re setting yourself up for decline.

Restaurants are a business like any other, and as an entrepreneur, you’ve already taken the plunge into the risky but potentially rewarding world of business ownership.  Growing a business is never easy, and trying to grow that business in the current economic climate is even harder, which is why a few key principles for small business ring more true today than ever: Read the rest of this entry →

In a previous post I wrote about how to cost out your menus so you are meeting your food cost projections.  Knowing how to cost out a recipe will give you an idea about where to set the price of your menu items.  The problem is, this leaves out an important part of the equation: your customer.

Take a cheeseburger for example.  What is a cheeseburger on your menu worth?

There are a lot of possible answers here.  Read the rest of this entry →

Many managers have the distinct privilege of being put in charge as manager of a restaurant after a previous manager has done their best to kill the business.  They drove away customers, and left the restaurant with a poor reputation and a dwindling customer base.  So what can you, as the new manager do to breathe life back into the business?

The first thing is to realize that you will not be able to revive the business overnight.  Read the rest of this entry →

After months of bad economic news, and hearing of restaurant struggling and even closing their doors, we are starting to finally hear some good news. Some people may even be considering if now is a good time to take a risk and start a new restaurant. Before you do anything too hasty, you may want to take a minute and analyze what the reports are really saying.

Before you rush right out and start making plans to start a new restaurant, consider the news that is still coming out. Read the rest of this entry →