Take Control and Grow your SalesJul 27, 2022
In my experience, growing sales isn't a "one size fits all" scenario. Each restaurant is unique in their own way; one restaurant might struggle financially while another with an identical operation is thriving. There are many factors that go into a successful formula: location, your staff, customer demographic, socio-economic status, the quality and presentation of your food, the surrounding environment, regional popularity (foods/beverages), the decor/furniture and "vibe", etc.
It's critical to understand WHO YOU ARE as a business and who you're catering to and attracting. It is equally important to understand who you are not attracting/driving away and why.
We can all agree that Sales, Cost of Goods Sold, and Labor should be the focal points of your business from a financial standpoint. Those are the 3 non-negotiable items that you must live and die by. With that being said, there are many ways to manipulate these figures. It begins with three simple components: the people, the process, and the product. I'll explain more on this later.
I: Look in the Mirror
- We need to be honest and transparent with ourselves while locating our deficiencies.
Where and why are we failing? Where and why are we losing money? What is dragging our net down? Everyone has weaknesses, but the strongest individuals have the ability to highlight them and work tirelessly to improve upon them. Moreso than anything, numbers do not lie. Accept responsibility and have the willingness to do whatever it takes to overcome this adversity. You must be ALL IN!
- It's important to understand who your local community is and what they are seeking from a dining experience.
Who are we catering to? Are we meeting their needs? What are successful businesses in my area doing differently? It's difficult trying to be a round peg in a square hole. Make sure your menu and pricing are on par with your environment. Be different while providing an experience that your guests will love and crave. Make yourself familiar with the most successful restaurants in your area and study their operation. What do they do differently? What is attracting so many customers? To be less uniform and more unique, research the most popular restaurants located in a similar community to yours but in different cities or states. As it's said about the NFL, "It's a copycat league." You don't have to reinvent the wheel; you must understand what is driving financial success to others and apply it to your business.
- This is difficult based on the current labor shortage and the lack of quality employees to choose from. Your people represent who you are to every customer that walks in the door.
Do we have the right staff and/or are we training them sufficiently? Does our staff believe in, and understand, our core values? Is your management passionate about your business and willing to go the extra mile? The goal for me was always to ensure my employees were providing the best possible service to all guests. Everything we do should be done with our best effort and highest level of focus. Your management should be coaching the staff to constantly upsell and increase the average check price on a daily basis. Don't ask guests questions, it's your job to tell them what they need; be friendly yet firm without being forceful while removing their option to say no. Clear tables quickly after each course; basic human psychology states that the longer you stare at your unfinished entree, the less likely you'll want dessert. Hold your management responsible for the P/L, their role isn't just day to day operations. Having the right people, with the proper training can be the difference between millions of dollars and closing your doors.
- Your menu has to be simple and align with your identity. There should 0 items in your kitchen that are only used in 1 recipe.
Are we offering too much? Some of the most successful restaurants in the world have just a one-page menu with less than 20 items. A great cook can use the same ingredient in multiple dishes while changing the flavor profile entirely. Control your food waste and consolidate your weekly ordering; simplify your kitchen and focus on your best-selling dishes in terms of volume! Look at the fast-food industry. Their menus are always concise and constant at the core. They know where their money is made, and those items never change. They'll then experiment with the other half the menu and try new ideas. These decisions are purely made on sales and volume; if a new dish isn't popular, it gets replaced and the cycle continues. You might say, "well that's just fast food, etc." Yes. But those are also billion-dollar businesses.
- Labor percentage points will make or break you. Properly staffing each shift while having management control and phase each shift is critical. You need to look out for your business and your bottom line, being the "nice guy" isn't the answer!
Is it costing you more than you're making to stay open later? Have you considered slightly increasing wages while removing a person or two from each shift? Let's dig a little deeper --
- Say you have 5 people in the BOH making an average of $18/hr. during a 10-hr. shift. 5x18x10= $900.
Restructure this model and remove 1 person from that shift while offering a $1 raise to each member of the kitchen with the understanding they are going to have to work a little harder (trust me it's possible!).
4x19x10=$760. You saved $140 on a single shift, AND your employees are happy to make more money!
- Take this a step further. Locate your peak traffic hours. We'll say on average your guest count increases most between the hours of 5pm-8pm. You do not need a full staff during off-peak hours. I'll use the BOH again for my example. You have 6 employees in the kitchen during an 8-hour shift, averaging $19/hr. 6x20x8= $960.
The BOH collectively worked 48 hrs. during this shift. My suggestion is to trim these hours and mold them to your peak hours of operation. When I was a GM, this method worked successfully with only 2 members of the BOH on shift during the off-peak hours. Use your manager to help expedite or jump on the line if you get an unexpected rush.
3x20x8= $480. This is your 3 cooks working the full 8 hr. shift.
2x20x4= $160. This is for your dinner rush aid from 4:30-8:30pm.
Previously we mentioned this shift used to cost you $960; after this adjustment you'll only be paying $640 for the exact same shift. That's roughly a 35% difference in your overall labor cost.
- Remove positions that aren't absolutely necessary. Who could you not function without? Cooks, servers, bartenders, and management. Can you survive without a host or a dishwasher? Believe it or not, yes, it's very possible! (I know from experience).
Servers can fill the role of a host while working an equality-based seating rotation; a manager can also help facilitate this. Dishwashers play a vital role in your operation. If you ask 1 prep chef or line cook to be responsible for dish with the added bonus of a $1-2 raise plus the ability to add an hour to end of their shift, odds are they will love the opportunity to increase their wage.
II: Staying Ahead of the Curve
- It's a necessity in today's world to focus your attention on the ever-changing market.
Your menu pricing MUST be on par with the inflation of your cost of goods sold! Each menu item should be priced at 3 times your cost, or 300% of your recipe cost. Now more than ever, you must be shopping for the best price through multiple vendors. Change your menu to avoid excessively high-priced inventory (chicken wings!).
- Adjust your portion sizes to avoid pricing yourself out of your market. I love the idea of creating a menu with 2 options for each item. A smaller portion at a more cost-conscious price, and a larger portion priced accordingly for those that are more indulgent and care less about cost.
- Invest in yourself! Advertising, marketing, promotions should be in overdrive right now. This is a positive expense that will pay huge dividend.
An effective social media presence will continue your growth at a faster pace. People eat with their eyes; the majority of potential customers are judging you before they even set foot in your door. Your social media shouldn't be filled with text posts concerning upcoming events or menu changes. Nor should it be nonexistent!
Flood your following with beautiful, vibrant photos and videos of your cuisine and beverage selection. Oddly enough, there is a complex algorithm to social media. The more frequently viewers engage with your page, the more visible you'll become to others. This algorithm includes timing, frequency, and engagement (Fun Fact: Statistically speaking, Tuesday at 11am is the most optimal time to post). Every single day Instagram Reels and Tik Tok videos posted by restaurants go viral and are viewed and shared with millions of people. Take advantage of this! Contact local social media influencers or local city-based social media pages that have thousands of followers and pay them to promote you or come film a review/put up a post about your business. The more present and constant you are, the greater awareness and attention you will generate.
- As I mentioned in the introduction, knowing your market and customer base is critical for success.
What is popular in your area? Have you attempted outsourcing weekly or nightly entertainment? Trivia night, bands/comedians, musicians, game night, a DJ dance night, game night when local sports teams are televised, etc. If you're in the area of a college, you can host college night and offer discounts on cheap beer/liquor and showcase a small plates/finger food menu. If you're in a wealthy area with an older demographic, you can pair up with a brewery or distillery and host a "tasting". This may take some trial and error, but it will also take a few weeks for the word to spread and popularity to bolster. Make sure any outsourced contractors have a following and will self-promote!
- Be comfortable being uncomfortable. Venture out of your bubble and try new things to stay on trend.
We live in a virtual/digital era, that is undeniable. Expanding your accessibility to cover all avenues is crucial for economic growth. In other words, step into the digital space. Is your website current, easy to navigate, and constantly being updated? Do you offer online ordering? Why not!? We live in an age where people bury their faces in their phones for the majority of each day. Phone calls are much less common, human interaction has faded. Online ordering is simple, stops the phone from constantly ringing, eliminates human error due to miscommunication, and most of all, introduces your establishment to a brand-new guest experience.
To build off my last point, you can also consider hiring a small delivery staff. Third party delivery services charge a ton in fees, avoid that unnecessary operational expense. Depending on your state laws, delivery drivers can be paid similarly to servers; they make their income from tips. For less than $5/hr. you can provide your own delivery service. Pair this service with your new online ordering system and you will undoubtedly see an increase in overall sales in the following months.
I firmly believe in the philosophy of restaurateur and philanthropist, Marcus Lemonis. "People, Process, and Product." The three P's are the cornerstone to any successful, sustainable business model; these three components can be applied to every restaurant in the country.
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