Common mistakes made in opening a Restaurant or a Cafe (Part - II)

1) Grand opening to soon

Of all the stores that I have opened, I have always gone with a soft opening approach. What this means is that I like to get my shop in order before I announce to the world "hey come look at me." I have attended meetings with very senior and a lot more educated strategist than I, who all criticise this soft opening approach and hammer home to me the importance of marketing from day one.

These individuals are educated by textbook, and although I understand the power and the importance of marketing, I also understand the timing. Only a Restaurant operations consultant or the staff of a newly opened Restaurant or Cafe can fully understand the mayhem that takes place with the opening of the new establishment.

Although it might be more costly to operate on a lull for a few weeks to sort out teething problems, when I do launch, I will be very sure that my establishment puts on a great performance and sends whatever punters that do come through the door, who I have welcomed, away with tales of success and high standards. Not in relaying a calamity of teething problems. You do not get a second chance to make a first impression. My marketing campaign also starts on day one but my first few clients are my staff whom I need to impress and secondly for them to impress me. Mess it up on day one and a good chance is you won't see these guests again, or any of their friends.

2) Don't focus on what you want or assume you know what other people want

A really simple but often overlooked set of questions to every business owner. Who is my customer and where is my customer?

Don't get bogged down in what you like, because what you like doesn't matter. Once you have decided on your area, conduct focus groups and research to get a sense of what people in your area want, or may not be available. Know your customer.

Alternatively if you have a chosen concept and offer which is unique, be sure you choose an appropriate location to market your product and are aware how much people will spend to have it. Too many times people miss the mark by not following the basics of supply and demand.

3) Location. Location. Location

Not just a term shouted from the rooftops by real estate agent's but an actual golden rule of retail. You will have a general idea and a desire for a location that's on your mind and throughout your search you may find suitable premises but the rent plus outgoings might be a bridge too far for you. This can be a scary moment to commit to signing a lease agreement that could tie you to that premises for upwards of seven years, I can acknowledge that.

I have worked in a two star Michelin Restaurant that was located in a very strange position, down a backstreet laneway, one that you would never dream to look and find. This is obviously a very niche market and can usually attract food enthusiasts on the search for such a dining experience, armed with a food guide or having already researched. Not a leisurely stroll where you are committed to pay such vast amounts for a dining experience. Not your spur of the moment lunch!  With that in mind convenient access and high visibility are critical. To attempt to save money on rent in an average location often results in average turnover and can lead to over extended budgets allocated to advertising in order to get noticed. Of course you must do your due diligence and know that you are paying a reasonable or ' market rent ' per square metre for your location. A little extra spent on rent can ensure turnover, turnover can ensure freshness, maintain consistent staffing levels and increase motivation.

4) Maintaining longevity in staff

Anybody with deep enough pockets can launch a Restaurant or a Cafe and attract staff to work in a new polished environment where the mice have yet to be separated from the men. Although chaotic at times, it will be a honeymoon period for some.

As any Restaurant or Café advisor will tell you. The first few months will be critical and also expensive allowing for overstaffing. When things settle down and you have built a solid client base and you are now operating at appropriate wage percentages, you will be at the mercy of your staff.

This industry tends to have quite a turnover of staff; it's just the type of person it attracts. The trick to your longevity will be consistency and the only way you can maintain consistency, will be with consistent staff.

For this, one must be realistic about your standards and your ability to maintain and govern them. Of course the variables are limitless but it is worth noting that what you launch yourself as, must be maintained. Keep this in mind at the menu development stage.

I have worked at a 3 chef's hatted Restaurant, Restaurant Of The Year and Best New Restaurant only to be followed by the loss of a Chef's Hat and eventual closure. It's demise. Reaching a certain standard and its inability to maintain it.

5) Appealingly to all

‘Jack of all trade's, master of none.’ I have discussed the point of uniqueness in greater detail in a separate blog but it requires mentioning briefly here as a point of concern and a major factor leading to the failure of many new restaurants or cafes.

You cannot appeal to everybody and if you try you will have confused customers and an over complicated kitchen. This will also leave you with no unique identity in the marketplace. It's best to find a gap, or a niche market and then put all your focus and energy into delivering to this space, with undivided attention. Having pages and pages of menu listings and multiple chicken dishes for instance will not allow you to stand out and be noted for your uniqueness and signature items. It will only confuse your customers. Again, know your customer.

At Copper Pantry Restaurant and Cafe Consulting Firm, my aim is to teach you from the mistakes I have made. Please check out my other blogs and drop me a line if you have any queries. Good Luck.


Common mistakes made while running a Restaurant or Cafe (Part - I)

Like any new business venture, many decisions need making. Opening a Restaurant or a Cafe is no different and because there are so many decisions to be made it's not hard to make some mistakes along the way. Here is a Hospitality Consultants Guide and some tips to avoiding common mistakes while opening a Restaurant or a Cafe.

1) Underestimating the finances required. Cash flow management.

It's not enough to have just a dynamic concept and great food. Most restaurants fall behind before the doors even open, so it's vital you plan correctly your budgets and cash flow and have allowances for add-ons.  It's very common for new Restaurant or Cafe owners to inadequately predict start-up costs required and fail to understand that things don't always go as planned. These might include construction delays, design changes and additional costs raised from local inspectors or building authorities.

Other less obvious costs may include licenses, permits, insurance premiums, pre-opening payrolls, bank guarantees and other associated borrowing expenses which are usually missed completely or grossly under estimated. Unless you are experienced in this field it is advisable to seek some experienced professional guidance in identifying and projecting finances required. Even with experience many professionals tend to add up to 15% contingency to allow for overruns which will enable a smooth launch.

2) Entrepreneurial explosions = clouded vision.

It's not enough to have a romantic dream of opening your own Restaurant or Cafe. You will require a clear vision as to your chosen demographic and food style. Also necessary is a realistic mindset in understanding the leadership skills that are required to work to achieve this in a very stressful environment, with long hours, egos and at an often-chaotic pace. Six absolute characteristics you will require are grit, empathy, strong communication skills, integrity, business savvy and finally, some more grit.

 3) A well-founded sales projection.

So let's say you overcome your first hurdle and the doors swing open. What now? It may take time to build your sales and even if your sales take off from day one your labour and food costs could be very high for the first few months as your staff find their feet. Teething problems are a given but run out of cash and you're finished.

A well-founded sales forecast is a must and even then the most professionally run outfits will allow a deficit for up to 2 to 3 months in cash flow. After the Restaurant or Cafe doors open.

4) Documented manuals/systems. Menu consulting/development.

Execute correctly your documents and working manuals and you are at least on track to having a foundation of which to work on.

As well documented in all of my teachings, consistency is the key to success and longevity. On any given day in a successful Restaurant or Cafe there will be thousands of tasks performed. This is the attraction of buying a franchise or license model, even though this requires ongoing expenses, it has a certain element of guidance and consistency, especially for inexperienced operators. What you're hopefully paying for is a well-documented system, which still requires implementation but is a good head start, (with the presumption of course that this model has been proven.) As I always say, to assume, is to make an 'ass', of 'u' and 'me'. Always do your due diligence if considering a franchise or license agreement or use a Restaurant consultant.

If you are not considering this option then think carefully about how you plan to lead a team by a vision solely placed in your head. The longer you operate without carefully documented manuals and guidelines the longer your Restaurant or Cafe will stay stuck in the often chaotic opening phase, a phase you want to put behind you as soon as possible. Failure to plan is a sure plan to fail. Find out more - Menu Consultant Melbourne.

5) Working in the business and not on it.

Managing a Restaurant or Cafe and running a Restaurant or Cafe are two separate tasks. Obviously at the beginning stage you will like and need to be hands-on in training, designing systems, customer service/feed back and overseeing the critical launch phase.

The core of your business is always your product and ensuring the product remains consistent. It is also important to have systems in place to allow you to distance yourself from the hands on tasks like serving tables and helping in the kitchen. Eventually your focus should be more managing the business by monitoring cash flow, planning marketing activities, evaluating your menus, administration, liaising with book keeper for wages and other associated running expenses. If you're doing the menial tasks of the day-to-day running of the business who is working on managing the future success of the business?

At Copper Pantry Restaurant and Café Consulting, my aim is to teach you from the mistakes I have made. Please check out my other blogs and drop me a line if you have any queries. Good Luck.