Common Mistakes Made by New Restaurant Owners

Business Articles

Most people who’ve eaten in a great restaurant have had the fleeting thought that it would be nice to run one of their own.

They imagine greeting customers and selecting great bottles of wine from Napa and the eastern region of France. It’s a nice dream, and only a few tortured souls follow through on it.

Those people find out quickly that, while running a restaurant can be rewarding, there are reasons people invest money in restaurant consultants. New restaurant owners can make fatal mistakes without even realizing their folly, causing long-term financial issues to fester.

Here are some of the most common mistakes made by new restaurant owners, along with some solutions for those problems.

Too much marketing, not enough tables

Restaurants typically start with a bang. People are often anxious to try out something new, and if you begin with a huge marketing campaign, you might generate serious buzz. Many restaurant owners spend too much time on marketing and not enough putting in a plan to turn over those tables. They end up with people waiting, which creates a negative first impression.

The solution is, to begin with, a soft opening to get your processes down. Cooks, servers, and bartenders must learn to work together on a schedule, and as a manager, you’ll need to know the average time for your patrons. This can allow you to better serve the people who’ll come when you finally open for real.

Loose supervision of the cash register

Depending upon the size of your restaurant, you’ll have different options for accepting payment. Some smaller restaurants have people pay at a central location, while others have servers that handle payment at various point-of-sale machines set up around the place.

Many restaurants have seen their profit go away because of employees who skim a little off the top. Restaurants are cash-intensive businesses. Loose supervision of your cash centers can leave you with a few dollars missing every day. Over the course of a year, this adds up to tremendous profit losses.

The solution is to have tight accounting. If you have a professional point-of-sale system in place, this shouldn’t be a problem. You’ll know how much food was sold and how much money came in for that food. Discrepancies can be tracked.

Some small restaurants use the old ticket and register system, though. These rudimentary approaches make it easy for employees to destroy tickets and take the cash, making it seem as though the patron never entered the restaurant. Technology can cure this problem.

Buying too much inventory

The supreme challenge of the restaurant industry is to either buy the right amount of food material or find a way to store the food that doesn’t compromise its quality. In today’s world, with consumers who want fresh, farm-to-table food choices, you’ll need to work hard to keep things fresh. Many business owners buy too much food, not wanting to run out of anything.

When you’re in the beginning stages of running a restaurant, err on the side of buying too little. There are many successful restaurants that tell their customers when a certain meal has run out. This is better than having hundreds of dollars of food go in the trash can at the end of the day.

As you get more successful and experienced, you’ll have a better feel for how much you sell on a given day or week. In the beginning, be careful not to waste your profit on unnecessary inventory.

Running a restaurant remains a challenge even for people with culinary and business skills. Money seems to leak away and customers can be fickle. New restaurant owners often invest in various consultants to help with the process.

Some choose to go out on their own. Whatever choice you make, be aware of the challenges so you won’t have to learn mistakes the hard way.