5 Biggest Mistakes Restaurant Owners Make and How to Avoid Them

The statistics are alarming. About?30 percent?of restaurants will fail within the first year of operation. The irony??They often fail for the same reasons.?So, to help you avoid these mistakes and achieve success with your pizzeria or quick-service restaurant, we’ve created this list of the five biggest mistakes restaurant owners make and how to avoid them.?

5 Biggest Mistakes Restaurant Owners Make

Whether you’re running a pizzeria or a quick-service restaurant, this information will help you sidestep the common pitfalls and increase your chances for success.

1. Choosing a Bad Location

Location can make or break a restaurant, so you’re getting off to a bad start when you choose the wrong place to set up shop. Here’s what we mean when we say ‘bad location’:

• Poor Visibility:?Choosing a location that is ‘off the beaten path’ is not a good idea. It also doesn’t help to be on a main road but not visible from the street.
• No Parking:?If your pizzeria or quick-service restaurant doesn’t have abundant, accessible parking for customers, you might lose business.
• High Crime:?Picking a location in a high-crime area may make diners uncomfortable and hesitant to frequent your restaurant.

In addition to selecting a good location, you’ll also want to choose a building that is an appropriate size for your restaurant and available for a price you can reasonably afford.

For help in choosing the right location for your pizzeria or quick-service restaurant, check out this article from?The Balance Small Business.?

Already locked into a location that is less than ideal? This article from?The Restaurant Times?has tips on overcoming a bad location.

?2. Not Focusing on Customer Experience

Customers drive a restaurant’s success, so you’re missing out if you aren’t focusing on their experience. That’s why ignoring the customer experience is one of the biggest mistakes restaurant owners can make.

Customers have high expectations when they visit a restaurant: they want excellent service, clean bathrooms and eating areas, and tasty food (among other things). If your restaurant can deliver—and exceed—your customers’ expectations, you will see better sales and more business.?

To avoid this pitfall, always ask yourself how you can improve customer experience in your pizzeria or quick-serve restaurant. Some ideas:

• Experience It Yourself:?To understand what the customer encounters, walk through the entire process yourself, from ordering your food to picking it up (or having it delivered) to tasting the meal. This will help you spot problems so you can address them. For example, if you experience a busy signal, missed call, or long hold time, you can correct the issue quickly with a?cloud phone system.?
• Check Online Reviews:?Online reviews can also help you understand how customers are experiencing your restaurant. Usually, people leave reviews when they have an exceptional experience, or a very poor one, so the reviews will help you capture the highs and lows of the customer experience.
• Be Ready to Adapt:?An honest assessment of your pizzeria or quick-service restaurant will probably uncover many areas where you could improve the customer experience. Being adaptable will help you make changes quickly without taking offense.

3. Lack of Staff Training?

Lack of staff training is another one of the biggest mistakes restaurant owners make. Not adequately training your restaurant employees means that you are not setting them up for success. They won’t know how to do their job correctly, leading to wasted time, money, and poor customer experience.?

On the other hand, providing good training makes employees feel confident and empowered. They will know what to do and understand that you are invested in their success. They can serve customers better and provide a consistent experience (both in terms of service and product). In addition, training helps restaurants avoid big problems like failed health inspections, bad customer reviews, and employee turnover.

To avoid this pitfall, it’s important to offer comprehensive training in all areas of your pizzeria or quick-serve restaurant. This includes:?

• Onboarding:?A restaurant employee handbook can help you onboard new employees, so they understand your business and the expectations you have for them. Your handbook should include things like the restaurant story and mission, the dress code, conduct and behavior, and rules and policies.?
• Food Handling:?Restaurant employees must know how to handle food to ensure food safety for customers and that your restaurant meets all food-safety codes. They also must know how to prepare the items on the menu, so customers receive a consistent product every time.
• Customer Service:?Employees should also be trained in the fine art of serving customers. Your training should include every element of the job where an employee interacts with a customer, including answering phone calls, taking orders, dealing with complaints, etc. You can boost your training with technology like?call recording and live call monitoring, which will help you train new team members and share best practices.
• Operations:?To ensure smooth operations, your training program should include details about how the business runs and what each position does. This helps employees understand how what they do fits into the larger picture.
• Technology and Equipment:?Employee training must also include instruction on using technology and equipment in your business, including the POS system, kitchen display screens, printers, cash drawers, and equipment to prepare food.

4. Ineffective Marketing Strategies

Another one of the biggest mistakes restaurant owners make is not having a good marketing strategy in place (or, for that matter, not having ANY marketing strategy in place!). Marketing is the key to finding new customers, so to grow your pizzeria or quick-service restaurant, marketing has to be a top priority.

When restaurants fail, it’s often because the restaurant owner doesn’t see marketing as an investment in the business. They may think they don’t need marketing at all or that they can rely on word-of-mouth marketing alone.

To avoid this pitfall, try out these tips:

• Define Marketing Strategy:?The strategy is the overall game plan for all your marketing activities. Having a strategy allows you to have a coordinated effort across your marketing channels and helps you maintain consistency in your message.
• Get Expert Help:?Allowing inexperienced people to manage your marketing (including your social media channels) is a disaster waiting to happen. Invest in an expert.
• Prioritize Online Visibility:?Today, all pizzerias and quick-service restaurants must be online. Make sure you have a professional website that includes, at a bare minimum, your menu and contact details. You’ll also want to claim your?Google Business Profile.
• Look for Opportunities:?Be on the lookout for new marketing opportunities available to your restaurant. For example, did you know that you can get a?cloud phone system?that allows you to customize ads or create upsell messages for callers to hear while they’re on hold???

5. Not Paying Attention to the Numbers

Financial mismanagement is one of the biggest mistakes restaurant owners make, leading to business failure. Just check out this PMQ article,?How I Went Out of Business: The Hard Lessons on Failure.?

The article shares five case studies of real people who opened up pizza restaurants only to see them fail a few years later. The main thread throughout these stories? Not paying attention to the numbers.?

Here are some of the hard-learned lessons these restaurant owners reveal:??

• Don’t borrow too much because you may not be able to get out from under the debt.
• Do your research so that everything is included when you set your budget, and nothing sneaks in that you didn’t account for.
• Keep an eye on food costs and be ready to adjust when needed.
• Be conservative and careful about major purchases (including renovations) that could add to your debt.
• Don’t be in a hurry to expand your hours—work up to more hours only when you’re meeting sales goals.
• Keep a close eye on cash flow, so you always have enough cash to pay vendors and employees.
• Have an emergency plan, so you are ready to handle changes in the economy.
• Review the balance sheet and the company’s overall health every week.?

Avoiding the Biggest Mistakes Restaurant Owners Make

Location, customer experience, staff training, marketing, and finances are five of the biggest mistakes restaurants owners make that result in business failure. Avoid them at all costs! By proactively addressing these pitfalls via the tips shared above, you’ll put your pizzeria or quick-serve restaurant in a better position for success and growth.

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