Sometimes restaurants – even with good food and a good customer base – go out of business. It’s never fun to see it happen, and if you’re running a restaurant of your own, it probably makes you a little paranoid. What went wrong? Are you next? You may even start making changes with a knee-jerk reaction that could be devastating. Before you do anything rash, sit back and really think about what might have caused that restaurant to close their doors.
There are basically two categories of reasons for why your restaurant shuts down: things you can’t control, and things you can control.
Things you can’t control
Sometimes it’s not your fault that the business fails. Here are a few reasons you might end up closing your doors due to things that are totally out of your control:
- Natural disasters
- Economic recessions
- Lack of staff
- Limited food supply
- Landlords kick you out and you can’t find another location
Issues crop up, and even the best planning can’t always keep your restaurant running when these things happen. Forced closures for Covid illustrated this point unfortunately well to a lot of food locations recently. Your business strategy wasn’t necessarily faulty here; it just happened.
Things you can control
Of course, then there are the things you can control, and there are a lot of them. Here are just a few things to keep in mind:
- Opening a restaurant that’s not unique in any way is likely to get a mediocre following at best.
- On the other hand, making a restaurant that’s too unique can have the same result – serving fried tarantulas in a small, traditional town is probably not going to net you a huge following, because while some people like to try new things, others will shy away from eating something like that.
- Location, location, location! Running a restaurant that doesn’t fit the surroundings is risky. High-end FSRs don’t often do well in less affluent areas, and vice versa.
- Overtaxing yourself and your staff can be catastrophic. Whether it’s staying open too long and requiring hard shifts that are physically and mentally draining to having too many varied items on your menu that leave room for error and spike stress levels, you’re better off with a simple, efficient system.
- Trying to do it all yourself is very, very likely to end in failure.
- Charging too little in order to “stay competitive” is not a helpful business strategy in the long-run.
- Poor planning can cause you serious problems. Baking cakes and cupcakes is all well and good, but if you don’t factor in the cost of equipment, ingredients, utilities, and, down the line, maintenance, you’ll find yourself under water sooner rather than later.
- Not taking action as soon as you realize something is going wrong is a big mistake. If you notice your employees are unhappy, customer orders are dwindling in a way that’s not seasonal or normal, one of your food suppliers can no longer support your demand, or you’re getting a lot of negative feedback online and you don’t do something about it immediately, you’re setting yourself up for disastrous consequences.
Luckily, the future is very bright – once you know about these things and address them, you’ll be a lot better off. Pay careful attention to your restaurant and act accordingly, and you’re much more likely to be successful.
If your business is stressful and you find that your staff is struggling to keep up with demand, one solution is to automate your phone. Reachify’s robust system is perfect for alleviating that concern. Get a personalized demo here.