A New Restaurant

With all of the talk about how bad things are, and no clear sign of when it’s all going to end, it’s easy to lose sight of a very important point: it’s still very possible to be profitable in the restaurant business.

Case in point: Buffalo Wild Wings.

When BWW released their earning for the 3rd quarter, they reported that they were in fact making a profit.  Despite the constant barage of news about how bad things are across the board.  Buffalo Wild Wings showed that it is still possible to make a profit during tough times.  Economic experts credit the companies “differentiated brand.”

What does that mean?  It means BWW does not try to be like other restaurants.  They are different, and their customers recognize that difference.  More important than recognizing the difference, they see value in that difference, and are willing to continue to spend their money there.

It proves what I have been saying; you have to dare to be different.  You cannot afford to be like your competition.  You need to be different, and you need to do waht you do better.

This doesn’t necessarily mean there cannot be any similarities, but it does mean your customers need to be able to recognize that you are different.  This can be in menu offerings, price and portion, service, or any combination of these things.

Be different, and learn to turn that difference into profits.

Do you offer combo discounts?  A lot of major chains are now bundling items as a way to increase their sales.  They are promoting combos that encourage their customers to buy more in an effort to take advantage of the discount.

It’s the “Value Meal” idea that fast food restaurants have been using for years.  Add fries and a soft drink to the sandwich, and price it at a discount.  Now instead of just getting the sandwich sale, you are also increasing the sale of the add-on items; items that typically have a high profit margin.

Think about it: What is the highest profit margin item you sell.  For many restaurants it is fountain drinks.  If you can convince people to ad a fountain drink on to their order you make more money.  Even with a big discount on the price, it is still profitable.

I’ve written before about “perceived value.”  If the customer thinks they are getting a deal, they will see it as a value.  If the value is great enough, they will spend more in order to take advantage.  If the value as seen as being better than your competition, they will come to you instead of going elsewhere.

Take advantage of the chance to beat your competition by offering better value combos.  Bundling is popular because it works.

Are you using your menu effectively?  Chances are your not.

I found a video about a man that makes a living going to restaurants and helping them engineer their menus to increase sales.  It’s really worth watching.  I’m willing to bet that you will learn a thing or two.

http://tinyurl.com/5jx7mu

How do you handle employees that have developed bad attitudes?

Sadly, even good workers can turn to the dark-side over time.  You don’t always see it happening.  It’s a slow change that happens over time.  Then one day you walk in, and you realize you have a problem.  So, what do you do?

One option is to fire the person.  A bad attitude can be like poison to the rest of your staff.  If left untreated, your entire crew is affected.  However, with the economy the way it is, cutting someone loose from your staff is a harsh thing to do.  Remember, the person you let go will need to be replaced.  You will need to recruit, hire, and train a replacement.  That takes time, and depending on the position, there can be a bit of a learning curve before the new personis really holding their own.  You need to determine whether or not the worker is salvagable.

Many times, the person is a good worker that has lost their will to be a part of the team.  When that happens, you can often turn their attitude around, and get them contributing to the restaurant’s operation.  If you catch the poblem before it becomes too advanced, it can be a quick and easy adjustment.

One way to do this is to sell him or her on your vision for the restaurant.  make sure they understand what it is you are trying to accomplish, and let them know how they fit into that picture.  Most of the time, if the pperson feels like they are important, they will step up and begin to take more pride in their work.

It’s funny how your perceptions change as circumstances change.  This especially true with the severe downturn in the economy.  Time like these require taking a hard look at how you are spending your money, and where you can make changes to cut costs.

The two biggest costs on most restaurant budgets is food and staff.

Cutting either of these can be a little dicey.  Cutting food costs many times results in either less options for your customers, smaller portion sizes, or lower quality.  When the market is so competitive, any one of these could be the nail in the coffin for your business.  If a customer starts to question the value of coming to your restaurant, they will start looking for where the value is better.

That leaves you with cutting staff.  Again, not an easy decision, but one that may need to be made.

When times are good, and cash flow isn’t an issue, it is easy to justify staffing decisions.  After all, you need to make sure you have enough people to cover the rush, and to keep the place clean.  An extra cook or bus person on Friday and Saturday night is a small price to pay for keeping your guests happy.  But now, cash flow is an issue.  In fact, for some restaurants, it is a huge problem.  Suddenly those extra people are a burden you can no longer afford.

Now is when you need to look at everyones jobs, to see where you can operate more efficiently with less.  Can the servers side work be changed to cover the jobs that the bus person was doing?  Can 3 cooks do the job that was done by 4 cooks?  Can you still get enough coverage with some people working 1 less hour each day?

It’s unfortunate to have to let people go, but sometimes the survival of your restaurant requires hard choices.

After my last post, Meagan wrote to ask me how often you should clean your restaurant.  Well, that kind of depends on what part you are talking about.  It’s kind of like asking, “How often should you clean your house?”

There are many parts that are going to need cleaned daily, or even several times during the course of the day.  Floors need to be kept clean, trash needs to be taken out, seats need to be wiped down, coolers need to be tidied and swept.

If you are talking about things that aren’t used daily, it could be a weekly task.  Unless you have some very sloppy diners, you pobably won’t need to wash the walls on a daily basis, but you will need to have them on a regular cleaning schedule.  The same with decorations, windows, etc.  Schedule the cleaning, then check to make sure the person assigened to do te job signs off on it when they are done.  If you wait until you notice the dirt, it’s probably gone too long.

Keeping your operation clean isn’t that difficult if you plan for it, and keep up with it on a daily basis.  Make your people responsible for their part.  Servers and bussers can be given cleaning tasks as part of their side work.  Cooks and dishwashers should be assigned parts of the kitchen that are to be cleaned.

The key is planning, and holding your staff accountable.  Make cleaning schedules, and require the people to sign the schedule when they have completed the task.  If you have a problem with cleaning, the schedule will tell you who was responsible.

The s ay cleanliness is next to godliness.  That may be a bit extreme, but it is a critical part of running a successful restaurant.It may be the difference between a regular customer, and a one time visitor that will be spending their money at your competitors restaurant in the future.