The restaurant business has always been both rewarding and challenging. With over $72B in sales in December 2021 alone, the restaurant industry has tremendously contributed to the economy. However, many challenges are associated with operating a successful restaurant business, especially if you want to offer high-quality services at affordable prices.
Here are four common concerns with managing a restaurant and solutions to address them.
1. Customer Satisfaction
Turning customers into loyal customers requires you to deliver excellent customer service to ensure they are happy and that they experience an unforgettable dining experience. But customer service can be inhibited when your customers are disruptive and disrespectful.
Restaurant owners should train their staff to be accommodating yet firm enough to stand by company policies. They need to know how to treat disrespectful customers with utmost respect and professionalism and when to call in the supervisor to handle the issue.
Your staff should know when to cut off serving alcohol to already intoxicated customers and how to handle their unruliness. Empower your staff to make the right decisions in such situations and how to communicate them to the customers. Ideally, you should never sacrifice your staff and guests’ well-being to get more money.
The goal is to provide an exemplary customer experience and get as many positive reviews as possible, especially on social media. But, conversely, many negative reviews will impact your business’s popularity and trustworthiness.
2. Cost Management and Budgeting
Running out of money to run your restaurant is the worst-case scenario in restaurant management. 39% of successful restaurants and 47% of no-growth restaurants report their number one challenge in business as high food costs. Failure to approximate costs and not including potential emergencies in your budget may bring your restaurant to its knees financially.
- You need to approximate food costs like raw materials properly, transportation costs, menu items, storage, labor costs, menu pricing, seasonality, and other operating costs like bills and salaries. Then, allocate them a reasonable amount within your budget.
- Also, consult an accountant to help you anticipate restaurant operations expenses and divide your money equally to manage your cash flow and avoid shortages before the planned time. Also, use a POS system to keep tabs on your sales, as it will help you calculate your profit margins.
3. Employee Retention
Losing key employees is one of the biggest challenges in the foodservice industry. Most people are working with you temporarily until they get another job elsewhere. Employee turnover may increase costs because it is cheaper to keep an existing trained employee than hire a new one.
Put a lot of thought into the team you hire, not only based on their competence. The ideal members need to be a great fit and have exemplary soft skills. The right wait staff will improve your customer service hugely.
- To reduce the turnover rate, hire people willing to build a career in the foodservice industry and are not only there for a few months, then quit. Inform them about all there is to know about their job, available growth opportunities in your establishment, training, rewards, etc. Although you cannot avoid turnover, do all you can to keep it in check.
- You can also deal with a high turnover by creating a list of potential employees. Whenever you need to hire someone, contact them as soon as possible. This way, you are always looking out for new talent. Prepare your training materials for new employees and recruit passively.
- Use digital signage to display the best employees and their accomplishments. You can also offer incentives to your top-performing restaurant staff. This way, you motivate your staff to work hard to see their images on the digital signage, and when your staff is motivated, employee retention increases and turnover reduces.
4. Food Security Challenges
Food security is among the top ethical challenges that restaurants face. Most issues pertain to food transportation like late arrival, lack of temperature-controlled transportation units, and food contamination.
These issues cause food safety problems that can cause customers and employees to get sick.
To curb this problem, restaurant businesses should find a transportation company with remarkable service delivery within their location that is affordable. Before settling on one company, take your time to review potential companies to know what other customers are saying.
Also, train your staff on safe food handling and proper hygiene and health practices. Ensure to enforce the training by having everyone wash their hands before handling food. They should also wear clean clothes, hairnets, and gloves. Also, ensure that the equipment is clean and sterilized and that all surfaces are sanitized.
It’s also important to implement a cloud-based access system where only specific employees can access particular food storage units.
Whenever applicable, do what’s right for your customers. For example, if your fridge broke down but you are not sure when, it is best practice to discard all perishables regardless of the loss you will incur. Doing this will minimize the chances of customers or staff getting sick.
Lastly, seek the necessary certification from qualified food auditors and display it where customers can see it to remain relaxed when in your restaurant.
Are You Ready to Succeed?
If not properly handled, these business challenges can strain your daily activities and jeopardize your restaurant’s future. The solutions to these operational challenges can serve as a blueprint to anticipate future issues and solve them early for your restaurant’s success.