HOW TO FAIL AS A RESTAURATEUR  

There is no shortage of sage advice on how to build that gangbuster restaurant concept and reap the spoils of your success. Dozens of books fill shelves with well thought out principles and rules of thumb – I own my fair share of them. What rarely attracts interest are those reflective works that speak about that awful word: failure. If it is from failure that we learn, wouldn’t it make sense to study those experiences of others, determine if there are patterns that set the stage for doom and gloom and then work like crazy to avoid the same pitfalls?

Few things are more soul crushing than seeing a once proud entrepreneur hang that sign out front that proclaims – “going out of business”, or “for sale”. That person had an idea, maybe one that came from years or even decades of chewing on it until he or she finally took the leap, pulled together some investors, begged a bank for a start-up loan, tapped into friends and family for a piece of the action, and spent every penny saved over a lifetime to bring a concept to fruition. There was never a moment when pride was more evident the moment a restaurant front door is first opened to welcome guests. The food was good, the place was interesting and spotlessly clean, the staff was in place, ads were placed in local newspapers, and the name of this perfect restaurant was hung with all the hope everyone could muster for success. Now, a different sign has taken its place. What happened?

So, for a different approach, here is a primer of advice on what not to do – common reasons why those brilliant concepts don’t work out. The objective is to understand these wrong turns and do everything possible to avoid them in the future. There are no guarantees, but we do know what gets in the way from success.

TWENTY WAYS TO SET THE STAGE FOR RESTAURANT FAILURE

WORK FROM YOUR GUT AND AVOID DOING THE RESEARCH

“I have a fantastic idea – I feel great about it and know it will work! Research takes time and money; I just need to get moving on this idea quickly. Build it and they will come has always been my way of thinking.”

UNDERESTIMATING THE IMPORTANCE OF A TOTAL EXPERIENCE

“Our food is delicious – that’s all that counts. People will come time and again if the food is good. Service is just a process of delivery, no need to invest in quality China, glassware, and flatware – no one cares about that. Worrying about fancy plate presentations of menu items slows down the delivery of food. Let’s just stick with taste and we will do well.”

IGNORE THE COMPETITION

“I am only in competition with myself. If I do things the way I think they should be done, then success is inevitable. I don’t have time to figure out what everyone else is doing, I can barely get my own work done.”

FAILURE TO TREAT EVERY CUSTOMER AS UNIQUELY SPECIAL

“The best rule of thumb is to treat everyone the same. Everyone’s money is green so why should they expect anything different from us. If we approach every guest with the same level of service and product, then we will be fine. They shouldn’t expect special treatment.”

AVOIDING EXCELLENCE, ACCEPTING MEDIOCRITY

“Excellence is way too expensive. Spending time on training, buying the best raw materials, finding exceptional employees, and anticipating what guests will want is reserved for those pretentious, fine dining operations. Good is good enough.”

THINKING TOO MUCH ABOUT PRICE, NOT THINKING ENOUGH ABOUT PRICE

“I think that people make decisions about buying by looking at the prices on the menu. We need to charge a little bit less than everyone else and we will win them over.”

TREATING EMPLOYEES LIKE PAWNS

“I just need employees who will show up, suit up, and do what I tell them to do. I don’t need people to think they can do things better, just do what I say. After all, I am paying them to do just that. If they can’t follow those directions, then I’ll simply hire someone else.”

AVOID TRAINING BECAUSE IT’S TOO EXPENSIVE

“Training? Why would I waste money on that. I’m hiring people who have worked in restaurants before and I expect them to be able to perform. If you can cook, you can cook and if you have served somewhere else, then I expect you will be able to do the same here.”

BUYING BASED ON PRICE ONLY

“When it comes to ingredients, they are pretty much all the same, so why pay more than I must? Canned tomatoes are canned tomatoes, and a steak is a steak. Frozen fish or fresh – the most important factor is cost.”

CUTTING CORNERS ON EQUIPMENT

“I can’t believe how expensive kitchen equipment is. I can’t afford to pay top dollar for refrigerators, stoves, and pots and pans. Let’s buy everything used or find the cheapest brand out there. I’m sure those other brands are just price gouging anyway. The cooks will figure it out if equipment doesn’t work perfectly.”

FAILING TO STANDARDIZE

“I hired cooks to cook. They should know proportions, seasoning, the best method of cooking to use, and how to assemble a plate. If I waste time standardizing everything, they probably won’t follow it anyway.”

ENTERING THE BUSINESS WITHOUT SUFFICIENT FUNDS

“I spent a fortune preparing to open, I’m leveraged to the max, and the cash well is dry. I need to make money from day one.”

NOT TRACKING AND USING ANALYTICS

“Really? You think I have time to measure the difference in business between days and weeks, take inventories, determine check average trends, assess what sells on any given day, and track customer comments? I’m up to my eyeballs in alligators – that’s busy work that I just don’t see having any value.”

PAYING TOO MUCH FOR LEASE

“It’s a beautiful building, in a great neighborhood, so far, the restaurant is busy every night, and I can barely keep up with everything. We must be successful – look at that full dining room! The landlord charges what he charges – what choice do I have but pay. I would have never been able to find a better location than this.”

NOT VIEWING MENU PRICING AS A SCIENCE

“So, what do you think we should charge for this item? What are other restaurants charging? Should we add a buck or two or should we undercut their pricing?”

FAILING TO ESTABLISH YOUR STAKES IN THE GROUND

“You ask what do I believe in as a restaurateur? I believe in full seats and overflowing cash registers. That’s all that matters.”

MARKETING TO THE WRONG AUDIENCE

“Who are my customers? What do you mean? I don’t know, they’re all the same to me. I put ads in all the papers, paid for radio time, and built a website and a Facebook page. I’m sure our message is getting out there to enough people.”

IGNORING STANDARDS OF COST CONTROL

“Again, I don’t have time to deal with waste measurement, portion control, inventories, checking prices of goods every time we order, and all that type of nonsense. Even if I did all of that, what value does it have?”

GIVING AWAY THE HOUSE

“I enjoy how busy the place is and feel good about taking care of my friends and family who walk through the door. It’s my place, I should be able to treat friends to a meal now and then.”

HIRING WITHOUT CONSIDERING TEAM CHEMISTRY

“Can you show up on time, ready to work? Have you worked in other restaurants? How fast are you and can you multi-task? This is how we put together a crew.”

It may seem so obvious that these beliefs are naive and hard to imagine as common practice, yet how many small single proprietorships operate in this manner? The process of setting the stage for success begins by doing just the opposite of everything in this article. The list could extend for many more pages, but the message is simple – listen, know what you are doing, admit what you don’t know, question everything, do it right, build your team, treat everyone with respect, train them well, and stay true to the elements of excellence.

PLAN BETTER – TRAIN HARDER