The one thing I cannot stress enough to you is, do not fear the failure. Your internal drive has led you to this point. Try new ideas and concepts using the skills outlined in this book. Some will work and many will fail, but that is all part of the process to succeed. I have taught you everything I can at this point for your success.
Remember this: go with your gut. Follow your instinct. Don't listen to negativity. Hear it, but don't listen to every single thing people say. Always be ready, willing, and able to test new ideas, marketing campaigns, menus, items, staff, and software. Another major thing you can't do is take anything personally.
Your restaurant is your dream, and you've poured your heart and soul (and savings) into it. And as hard as it is to do, you cannot take anything personally. Your restaurant is about your food and customers, not about you (though it may not feel that way). In the course of a day, you'll hear the following comments and more:
My personal favorite is when someone asks, “Why does the soda taste funny?” You can open a can of soda, pour it into a glass, and bring it to someone, and they will still ask, “Why does the soda taste so funny? Is there something wrong with your gun?” You know you just poured it out of the can. Why would it taste funny?
So expect this, expect the worst, and love the best. If you can be ready for the negativity, imagine how you're going to be for the positivity. I just want to make sure you never take it personally. Don't ever assume anything. If someone's making a face, you could freak out and think they do not like something. They could love your food and just be reacting to a conversation about something that has nothing to do with the food.
Don't assume, and don't take things personally. You will then succeed in being positive. I try to keep a clear mind, and I think if you can keep a clear mind, you can get through any problems. Those thoughts are like seeds that grow and will throw you off your game and make you question your abilities. That being said, we also need to look at the concept of failure.
There are going to be failures, bad days, and great days. You'll have horrible days where you will make no money and fantastic days with a big profit. Take it all with a grain of salt. Look at the big picture in the end. It's enjoyable to get excited, high-five staff, share social media posts about your successes, and celebrate. Of course, you want to do that. Then comes a down-in-the-dumps day, but that is still cool. Just keep going with the flow and move on. Remember that slow and steady wins the race.
I cannot stress enough for you not to panic. Think of your business like water flowing from a spigot; if you grab at the water, you will get not any, and that is what will panic you. However, if you slowly cup your hand, you will fill your hand and can drink forever.
If it is a bad day, a bad week, or a bad month, don't come up with excuses.
If there is road work and the street is torn up from construction, making traffic horrible, that is not the reason people are not coming into your restaurant.
Maybe you lease space as a third-generation restaurant, and it remains empty. I know of many spaces that have been leased as several restaurants, only for each restaurant to close in a short period of time. It's not cursed. You don't need to sage the place.
The temperatures are scorching or freezing cold, and people are not coming to your restaurant. If this was the reason, why do people go to other restaurants in the pouring rain or bad weather?
You tell people that Millennials don't like the dishes you are offering, or Boomers eat a different kind of food than what is on your menu.
It is an excuse if you blame the location, the weather, or any other factors at this point.
What you need to do is figure out why people aren't coming into your restaurant. Who cares why they didn't go to the restaurant that was there previously? There's a reason that restaurant failed. You have a different reason why you are not getting customers, and you need to figure that out. If you say it's your location, then close this book and find another business.
Customers will come to the restaurant if your service is excellent and your food is wonderful. Yes, consider all the circumstances, but don't make excuses. If there is a problem, fix it. If there is a challenge, overcome it. This is your dream, and while I can share advice, knowledge, and expertise, it is up to you to make it happen.
I can't say this enough: be of service, especially to your staff. The last thing you need is an employee telling everyone how badly you run your restaurant. You don't need staff members bickering with each other. This bitterness will implode, especially in tight quarters like a kitchen or a small restaurant environment. This could involve your customers as well, and you don't want that. You just want to be of service. Everybody's equal. You're as equal as the cook and dishwasher. If you're too good to wash dishes, mop your floors, and take out the garbage, close this book and pick another one off the shelf, because this is not the business for you.
If you have done all these great things, if you are of service to everybody, and if your food is excellent, you will make money. Now that you're making money, you're thinking to yourself—and, of course, your friends are telling you—that you need to open a restaurant on a different side of town. People will ask you if you have ever considered opening one in Los Angeles; Rutherford, New Jersey; Potomac, Maryland; or wherever. This is called scaling up. Do you want to scale up? And, more importantly, are you ready to scale up? Are you prepared to make a chain out of your locations?
Scaling up is not as simple as it sounds. Restaurant owner(s) who have scaled up and failed do so for many reasons. They were not of service to everybody. They did not go with their gut. They didn't mitigate the cost of labor. There are many factors to success and failure.
If you have your systems in place in your first restaurant, you must have everything in writing (literally). I don't care how simple or minuscule; it's A to Z. This is how you turn off the light: lift your finger, go to the light switch, and push the light switch down (or flick it down, or grab it with two hands or two fingers and push it down). If you're going to scale, this is how you have to do it. It is a laborious process because you can't be split into two, three, four, or five people. If you can't find someone as vested as you in the business, don't do it. I have seen many restaurants that have tried to open other locations go down the drain. The concept was good, the food was fantastic, and the staff were great. But there was not another person with the same heart, soul, and vested interest as the owner who opened the first location, so both locations failed.
Other people will urge you to franchise your restaurant, which is different from opening a chain (where you maintain total ownership and responsibility). There are different levels to franchising, from opening a restaurant that duplicates the original to just licensing the concept. Are you prepared for it to fail? Because that failure will lead right back to your original location.
You got practical advice about opening a restaurant, it is becoming successful, and you think to yourself, I'm going to duplicate that business. Everyone will follow what I did exactly, and the new restaurant will also be successful.
I've tried it, I've done it, and it doesn't work. I sold four of the hamburger places that I had opened (each of them) for $25,000. The new owner couldn't duplicate what we were doing. As I mentioned earlier in the book, he added chicken wings and nachos; in the end, it wasn't the same place. The name of the brand was the same, but everything else was different because there was so much going on instead of our concept, which was simple. He was struggling and trying to fight for success, but he wasn't following the basic principles. There were too many locations, and he didn't have someone at each location to properly follow the rules of engagement for his brand. So the restaurants eventually failed for him.
I did this with the flower shops, too. I thought that I could open a successful flower shop in locations where previous flower shops had failed. I was wrong. I failed hard, costing me hundreds of thousands of dollars. Luckily, I was in my early 20s, so I had another 60 years to worry about my future. I learned that lesson, and now I am sharing it with you.
You may not have that option. Are you in a position that you can open several restaurants at the same time and have them fail big? Maybe you should stick to one place, especially if you are doing fantastic business.
If you have your heart set on expanding, ask yourself these questions: Do I scale up? Do I make this a chain? What do I do? How do I keep everything the same? How do I follow those rules of engagement and run each place the same way with the same principles?
You think to yourself that lots of people love your place. My advice is, don't do it. Don't scale up. It's a scary thing. Even with a husband and wife team, I still don't think it's a good idea. I don't see any positives in multiple units, and I think you're going to end up taking money from the first success to pay for the failures of the second.
Now let's talk about scaling up just the one place.
First, here is an example of what can happen. There used to be a great little bar called Huey's on Maryland Parkway in Las Vegas. The place was known for its peanut butter cocktail, and it was just a fun place to hang out. People loved it, and business was thriving. Then the owner decided to upscale his place. He moved the restaurant to a free-standing building a couple of miles from his original location. He changed it totally to include a party room and fine dining, and, of course, he increased prices. It went out of business in a short period of time.
Now let's consider your current location. Let's say it is a fantastic Italian restaurant, and the space next door opens up and is available for lease. You believe that if you lease it and put in 20 more tables, that will equal more revenue. The next question should be, can your kitchen (staff and food inventory) handle that extra business? What is in that space? Do you need another kitchen? But the most critical question is, do you have a line out your door? Because if you don't have a line out your door, you don't need more tables.
I can almost hear you now: “But this is such a great opportunity. I can open a banquet room. I can do weddings and private parties, and I can cater. I can bring in a lot of money and revenue.”
My next question is how many people have asked you about a banquet room. Then I have other questions, such as “How much is the rent?” If the rent is $2,000 for the space, you're going to have to fix it up. I would estimate that you will have to invest at least $5,000 for the upgrade. You may have to upgrade to a new sound system, because you can't offer an event space without a good sound system. You may need more audio and visual equipment along with televisions. You're going to need a stage and a dance floor. That goes well above $5,000. You may even need new bathrooms. Go back to your research, and start to look at this as a new business. Do the numbers work? Is it needed in the area? Are customers asking for it?
Unless you have worked in the event business, I recommend that it is probably not the best idea to commit to that extra space as a banquet hall. It's going to take your time and money away from your current source of income: the restaurant. It won't benefit you, because you're not going to do it with a 100% effort. If you don't do it with 100% of your energy, people won't want to pay the 100% pricing. So you'll have to offer less expensive food, and that's not representative of the food you're selling in your restaurant.
You're going to lose money in your restaurant, and this banquet room can be an unnecessary drain. I advise you not to scale up and not to lease the space next door. I've seen too many restaurants expand their space, move to bigger locations, and ruin everything they have achieved.
Let's talk about scaling down. What if things aren't working right now? What can you do if you feel like you're hemorrhaging money? What if the business is not performing the way you anticipated?
You have to scale back the staff first, without reducing your service. Maybe you don't have someone standing at the front seating people. You can now have the policy that when a server is open, they go onto the front and seat guests at a table. Do you have family members who can work for no salary? You can clean the place yourself, so you don't have to pay someone to clean.
However, don't reduce your staff and then reduce the quality of the work, food, or service, because customers will notice. If 10% of your income comes from the lunch crowd, close for lunch and save the money, food costs, and overhead. You can change the hours again to open longer hours if there is a demand.
However, you can make those hours count and work your way up. Use the time as prep time. Sometimes you may get a delivery order or big office lunch order that you didn't expect to have that day. But if you're closed, you're not going to get it. Let's talk about multi-job purposes for individuals. Take a hard look at that. Are you offering delivery? Work on these services, because it's free marketing. Consider adding delivery services, and don't get in your own way with your ego.
When the restaurant is closed, you can rent the space for networking groups, meetings, and private parties. This option offers lots of extra income. For example, Lawry's The Prime Rib is, in my opinion, the most delicious prime rib place in the country. They are not open for lunch. But they offer the space for meetings and other events. Lawry's makes sure the food that is served at these meetings and luncheons is the same food served at dinner. Use this exact model.
People are tasting your food at these events, so consider it a taste test. If they like your food, they will come in for dinner. Charge for it, but go over, above, and beyond. If you found a location in an office park, and business dies down after 5:00, don't sell dinner. But you can cater and use those hours for networking groups and private parties. Come up with some really creative marketing ideas for additional revenue.
Next, you need to figure out your problems and why you're not making money.
Go through your checklist. Why am I not making money? Is it my service? Is it my attitude? Is it my food? Is it my hours? Is it my staff? Scale back momentarily with the intention of going back to what you were doing, but figure out what you're not doing.
When scaling back, you may want to make drastic changes like changing your ingredients. This is not an option. For example, you might be using fresh, very expensive high-end cheese, and you want to switch and use a more inexpensive cheese to save costs. Guess what? It's too late for that, and you've chosen to use this cheese. If you start switching ingredients and people notice, those people will not come back. Now you have compounded your problem. Talk to your vendors, and ask for better prices. If you can't negotiate lower costs for the food items you use, start looking at trends for potential menu changes to less costly ingredients. If you have to change your food, I would add menu items using food that costs less. If it fits with your cuisine, add something like French fries or mashed potatoes. You can cut back slightly on the portion of meat or other expensive items served (without changing the ingredients), add the potatoes (at a lower cost to you), and still serve a full meal at a great value while reducing some food expenses.
So what you need to do is scale down a little bit. Learn how to save money. You're bringing in money; you also need to bring more customers in the door.
Are you upselling items such as appetizers, drinks, and desserts? Start thinking of ways to upsell. If your food is on par as we talked about, you know what people want; they'll spend an extra eight bucks on a piece of cake. Customers are going to want it. I don't care how stuffed they are; people love dessert. Don't feel that you are “taking” money from people; you are offering other choices, and people will say yes or no.
The only thing you can't change is your location, but you certainly can improve your marketing. There are ways to do it, and you need to really investigate what you can do internally and externally to rebuild that business.
If you are on a roller coaster, you see things first going up a hill, and then all of sudden you are going downhill. Don't panic if you have to scale back. But don't step on the brakes. You need to keep the momentum to go back up another hill. I am going to repeat—do not slam on the brakes. Change the way you're doing it; keep the momentum. You know you're going down a hill, so scale it back a little.
Keep the restaurant going. But don't let your staff or customers see you sweat. Don't whine and tell everyone that you're not making any money. Tell your team you're just changing their hours, or figure out a way to make it work. But you have to keep that momentum going, and you can zip right back up. So it's not a matter of closing your doors. If you did everything right, there's a problem. Figure out what that problem is, or go back and reread the book. Maybe something else will click, and you'll realize what mistake you might've made, and you can change it.
It is your business, your dream, and your life, so stick to it. Your determination and fortitude are what will work to make your business a success.