Opening a New Restaurant or Café? Here’s How to Beat the Odds and Stay in Business


By Liviu Ungur

Let’s say you’ve decided to open a restaurant or a coffee shop. Chances are you’re heading toward disappointment. Six out of 10 restaurant businesses fail to make it past their first year, so you may conclude that this is a gamble. Or is it? What do the other four eateries do differently that they make it to breakeven and beyond?

If you’re keen on finding out, I suggest we delve deeper into the matter together. Ready? Let’s begin!

Customers pay for the experience first

I’m sure you’ve heard people say “location” three times in a row like it’s some kind of a spell, but in reality, location alone doesn’t guarantee survival and success. Setting up shop in a touristy area or next to some fancy body of water isn’t enough to turn your brand new restaurant into a cash cow. I wish to emphasize the importance of ambiance and the location’s overall charm, which are accountable for half of your profit.

How’s that possible?

Well, when people go out to spend their hard-earned cash, most customers are inclined to associate the appearance of the establishment with the quality of the products. Even if the food is not remarkably good, your clients will keep coming back just for the atmosphere. Therefore, make sure your restaurant is welcoming, has a solid identity, and the staff is genuinely polite. Location does help, but it’s not enough.

Long story short, if you can make a first good impression and keep your clients happy, you’ll be off to a great start.

They build menus that sell

According to chef and restaurant expert Ryan Gromfin, a professionally-engineered menu will certainly increase your profits. Now, he doesn’t call it manipulation, but if you carefully build your menu following his tips, customers will ultimately choose what you want them to.

You can find out exactly what menu engineering is from Gromfin himself by watching his video, and I’ve also pulled out a few key points:

  • Your menu should not contain $$$ signs (or other currency symbols).
  • Hide the prices in the text.
  • Don’t emphasize prices in bold.
  • Display prices in a smaller font.

Applying these tips when building your menu will draw the customer’s attention to your products, and that’s your goal. Inexperienced entrepreneurs are prone to believe that by highlighting the prices, we, the customers, will compare them with the competition’s or that we’ll order more. Truth is we don’t want to be reminded about money when we seek to raise our dopamine levels.

You’ve also probably seen on many menus boxed items in bold colored letters. They’re usually positioned in one corner or right in the middle, depending on how many panels the menu has. These are called “sweet spots” and their purpose is to convince customers to order what seems to be a great choice. In fact, that deliciously described dish is most certainly one of the top three most expensive items on the menu.

Fortunately you don’t have to hire costly professionals to design a stellar menu because you can easily make one yourself. Just google free menu templates and select a menu template which best suits your needs. Ready-to-use menu templates will save you lots of time and money, not to mention they look perfect both in print and digital.

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They do few things exceptionally rather than many superficially

Focus on offering only the best. You’ll sell better because people will recognize you as the one who makes fantastic burgers, or a divine cappuccino, or the expert at whatever you’re planning to sell.

To make my point, let’s look at Jiro Ono, the protagonist of Jiro Dreams of Sushi, who’s dedicated his life to making the best sushi on the planet. You have to book a year in advance to eat in his restaurant, and the menu is prix fixe, which means there won’t be any surprises when you ask for the check. Given his reputation, the $275 plus tax is totally worth it. He’s a legend, and there’s nothing stopping you to become one as well.

Find joy in elevating your craft and persist in achieving perfection. People will start talking more and more about you, and spread the word about the quality you deliver. I’m sure you know there’s no publicity like word of mouth, and this brings us to our…

Conclusion

So four out 10 food and beverage businesses elegantly waltz past the critical first year and now you know why. You have to be extremely disciplined, passionate, dedicated, and mercantile. Treat your clients like you’d like to be treated and never let your guard down when it comes to the quality of your products and services. Build an enticing menu, but make an effort to keep it simple for your clients to navigate and decide.

And finally, don’t be an aloof host. Make your customers feel like you want them there for all the good reasons. Happy customers tend to become regulars, and they will happily promote your business.

RELATED: Business Lessons Any Entrepreneur Can Learn From a Failed Restaurant

About the Author

Post by: Liviu Ungur

If people considered wining and dining a religion, Liviu Ungur would probably be the head of that church. As a wine bar manager, Liviu allocates most of his time and resources to self-indulgence and assimilating relevant information on hedonism. He also fancies himself as a wordsmith who takes pleasure in sharing his experiences, such as they are, with his fellow bon viveurs in need of practical advice.

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