7 Tips To Make Increase Your Restaurant Profits

Published: 08th April 2010
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It was about 20 years ago that the casual dining boom got going in the United States. It was a golden, batter-dipped age: We were lured in by the novelty of mozzarella sticks and artichoke dip, marveled at the cluttered walls and uniform flair and gulped down two-liter mango margaritas like every night was Friday.

But the bloom is off the bloomin' onion when it comes to casual dining. The current recession has clients trading down to fast food and also the growing "fast-casual" segment of takeout specialists (think Chipotle, Noodles or Panera). Over the last couple decades, while drive-thru burger joints have kept their costs flat, the typical bill at informal dining chains has multiplied three or four times. And the caliber of the foods has remained pretty much the exact same while fast foods has become better and more diverse. Add to that grumbles about predictable, high-fat menus and stale d'cor and it is understandable why in 2010 the category was down 5 percent to 8 % with a 3 percent to 5 percent drop forecast for 2011.

There are several steps draw in a down market, and it is critical to remember that even individual franchisees are not powerless. We spoke with a few of the leading thinkers in the casual dining field to learn what you can do to put a little flair back into your business.

1. Think locally

Casual dining chains are some of the most aggressive national advertisers out there. The issue is, lots of franchisees think that's sufficient, particularly after a splashy grand opening with large media buys. Casual dining mom-and-pops haven't been hurt as much by the recession, mainly because individuals feel a strong connection to the businesses. Becoming a local leader and integral part of the community, versus a faceless chain, can greatly assist to developing client loyalty.

2. Speed up lunch

Lunch is when the fast-food joints and informal restaurants go head to head--and wherever casual dining loses out. "Business users wish to get in and out rapidly, and most do not have a full hour for lunch," says Darren Tristano, executive vice president of Technomic, a Chicago-based food-industry consulting and investigation firm. Shaving 10 to 15 minutes off a visit can mean the difference between drawing a lunch crowd or sitting idle for the afternoon.

3. Push the bottle

Booze is usually a high-margin item for informal restaurants, but more importantly it's a gateway to gaining customers for dinner. According to Technomic's research, only 14 % of clients find occasion to drink in the afternoon, which is why national chains have started out placing a new emphasis on earlier happy hours.

4. Push the plate

Besides offering an extended pleased hour on booze, create a pleased hour on menu items, suggests Tristano, who points out that Steak 'n Shake's afternoon half-price milkshake promotion can easily lead to an order of burger and fries, and Braxton Seafood Grill's happy hour, when it sells lobsters at cost, frequently gets orders for three beers and all the fixings.

5. Pinpoint the quality

"If you are at a Mexican restaurant, people are likely to notice if you're scraping broken tortilla chips from the bottom of the barrel and not filling their glasses to the top," Tristano says. Numerous chains also make the mistake of charging for soft drink refills or reducing the amount of servers to save money.

6. Do not chase Subway

One of the large temptations in informal dining is to simply slash prices until hordes of $5 deal-seekers start filling the tables. But Sinclair says that's exactly the wrong tactic. "All that does is draw in deal hunters, and when the promotion is more than, they won't return," he says.

7. Give them something special

It might seem obvious: People visit a particular restaurant to obtain foods they can't get anywhere else. But that idea has become murky in informal dining, where fried appetizers and flatiron steaks have all melded into culinary clich's in their businesses will succeed."

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