A love for cooking may seem like the only prerequisite for opening a restaurant, but experts and veterans agree that beneath the allure lies one of the most challenging industries to enter.
Many people see money, money, money, but it’s one of the hardest industries to get into.
Restaurants accounted for 772,000 jobs, or 9 percent of all employment in New York in 2014, according to the National Restaurant Association, but a Cornell University study said about 60 percent of independent restaurants fail in their first year.
While the numbers are daunting, there are steps restaurant owners can take to avoid landing in the 60 percent.
A majority of the work opening a restaurant comes from the planning stages.
There are two ways to start a restaurant: find a great location and base your concept on that, or find a great concept and find the location to suit it.
It is highly recommended that you create a detailed business plan, including a location, concept, audience, demographic, competition and menu. However, none of these matter without proper funding.
The number one reason restaurants fail is because they don’t have enough capital.
It could take up to a year before a new restaurant starts making a profit. Numbers are hard to pin down in the restaurant business.
There isn’t a crystal ball that tells you how many people are going to come in each night.
Beyond the work starting up the restaurant, it’s essential to create and maintain good customer relations.
If you don’t stay in the front of the mind of your guests, they’re going to start to forget about you.
To manage this, a strong social media presence, as well as word-of-mouth is very important.
A common misconception in the restaurant industry is that the profits come from food. While that is part of the equation, rising food prices mean restaurants must find alternate sources for income, such as catering.
While it may be tempting to raise menu prices to help combat costs, it won’t work with restaurant-goers.
People are more value-focused today and definitely won’t tolerate higher prices.
It is impossible for a restaurant owner to do everything, but it’s necessary that everyone working is on the same page.
It’s important that your staff share the same vision as you do, so they can carry that vision through to the best of their abilities.
Five things restaurants must do:
Three things restaurants should avoid at all costs:
Source: poughkeepsiejournal.com, 2-21-2015