A New Restaurant

A recent study showed that two-for-one deals are a really bad idea for small, privately owned restaurants.  The study showed that the offers work very well at getting people into your restaurant, but as soon as the offer is over, they stop coming in.

Unfortunately, many restaurant owners don’t understand how these offers work, or don’t think through how using the offer will affect their business.  They seem to offer deals because it’s the trendy thing to do.  It’s that lack of understanding how it all works that will lead to your restaurants failure.

The idea behind the two-for-one deal is that it gets people into your restaurant, and you can show them what you have to offer (just make sure your ready for them when they get there).  It’s a great plan if it really worked that way.  The truth is, most of the people are only there because of the deal.  The nest time they want to go to a restaurant, they will look for another deal.  If you want them to come back to you, you have to give them another sweet offer.  For most of them, the only time you will see them is when you run a two-for-one offer.  Your restaurant will only get a small percentage of customers to return.  In my book, that doesn’t qualify as a successful promotion.

Now I don’t know about your operation, but most restaurants can’t afford to see their costs double as a percentage of sales, and that’s what two-for-one offers do to you.  It reminds me of the old joke about the guy that says he loses money on every deal, but he makes up for it in volume.  Unless you have really deep pockets, it does not make good business sense to run deals that cause your restaurant to lose money (unless you are running the deals to force your competition out of business).

There are a lot of good advertising methods that you can be using.  Discounted appetizers or desserts, cents-off coupons, these are just a couple of ways to draw customers in without breaking the bank.  Once you get them there, it’s up to you to make sure they come back.