Top 20 factors for success in the restaurant business.

6. Targeted marketing. Make sure your marketing focuses on your trade area, your customer demographics and their buying behaviours. Find ways to measure the success of each marketing program.

7. Quality food. You’re only as successful as your last meal.

8. Quality service. You’re only as good as your last customer interaction. Do you talk about good service or does everyone in your organization understand it and live it?

9. Flawless execution. Do all the elements of the experience you expect to provide to your customers come together every hour of every day? How do you know? Do you take action to make sure that they do?

10. Customer data. Do you really know your customers – their demographic profile, their needs and their preferences?

11. Customer feedback. Do you actively encourage customers to provide feedback at the time they are served and do you act on any negative experiences immediately?

12. Empowered staff. Do your staff members know how to manage the customer experience and take action when an experience fails to meet the customer’s expectations? Do you make sure this happens?

13. Realistic financial formula. Does the through-put of your restaurant allow you to generate sufficient revenues to meet fixed costs and profit expectations after all variable costs are covered?

14. Menus engineered to yield optimum gross margin. You bank dollars, not percentages. Does your menu steer customers to selecting the menu items that yield the highest gross margin?

15. Maximum buying leverage. There is a big difference between “street price” and the price you pay for food and supplies when you maximize your purchasing leverage. Consider one-stop shopping, buying groups and volume management.

16. Labour balanced to demand. To open the doors, you require a basic labour complement. This constitutes your fixed labour cost. Profits are often squandered through poor scheduling of variable labour costs representing the additional labour you need to meet anticipated demand. Know your labour requirements by hour and schedule accordingly.

17. Effective capitalization. A restaurant’s life cycle is generally five years. In year one, you build the business; in years two and three, you fine-tune the business; in years four and five, you maximize earnings. After that, you must re-invent the business to create new excitement for your customers. Don’t forget that in the first year you need at least six months of working capital to build the business.

18. Experience. It’s relatively easy to get into the restaurant industry. Sign a lease, buy some food, hire some staff. It’s what happens after that that makes the difference between success and failure. What you don’t know WILL hurt you! If you don’t have experience, get it – through school, through working in the business or through a trusted adviser.

19. Participative management. You can’t run a restaurant from your office or from your desk at another business. You must be present, involved and leading. Absentee ownership has resulted in failure, time after time.

20. Winning attitude. No one likes to eat in an empty restaurant. You and your staff must convey a winning attitude. An infectious positive attitude is necessary to “bring ’em back”.

While no one can guarantee your success in the restaurant industry, if these factors are taken into consideration, you will have made great strides toward success.

See also:

About the Author:

Geoff Wilson is President of Geoff Wilson & Associates Inc., a Mississauga, Ontario based consulting firm specializing in business strategy for foodservice operators, facility owners, food processors, foodservice distributors and related parties. He is a founding member of fsSTRATEGY, an alliance of senior consulants specializing in the foodservice industry. Geoff can be reached at (905) 814-6610 or by e-mail at

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