Chicken wings are flying out of the fryers during the new normal of Covid-19. Wingstop itself is UP an over 30% durign Q2 2020 and a long list of major chains have taken notice. Domino's (not know for a quality chicken wing) has been working on improving their wing experience and adding sauces, due to increased interest. Taco bell is rumored to be testing chicken wings in California. Multiple brick and mortar chains are venturing into virtual wing concepts. Chili's has launching "Just Wings" and Applebee's launched "Neighborhood Wings".

What this means

Chicken wings used to be a by product and producers almost gave them away. Ten cent wing nights were standard bars all around upstate NY. Basically free chicken wings are a good way to bring in and keep people buying drinks.  The popularity of the chicken wing went through its first explosive growth during the 90's with multiple franchises growing and becoming popular around the country offer the buffalo wing.  It should be no surprise that the price followed the popularity. Once a basic giveaway, independent restaurants without much buying power had to raise prices and watch margins.

This also brought about the seasonal wings price spike around super bowl and march madness times.  With so much demand the prices must follow. So... unfortunately this next wave of popularity will probably mean another raised plateau of cost. Hopefully there will still be a bit of margin, but for most independents it will be a break even at best product.

Opportunity

With the demand for bone in wings soaring, other chicken products are seeing cost reductions.  It takes a large number of chicken to produce wings, so the chicken breast prices have been coming down in the last 4-5 years.  Take a look at the prices...

Even the big boys have been taking notice: Buffalo Wild Wings bets on boneless as wing costs soar

BOTTOM LINE: get creative and work on your boneless chicken recipe and maybe throw in some tenders to help make up for the lost margin on bone in wings.

The post Chicken Wings see Huge Boost During Pandemic appeared first on Restaurant Coaching Online.

Respect

First off we need to talk about respect.  If you can't have respect for the people that work for you please get out of the restaurant business, or any business.  Think what can happen if your employees don’t respect you. They won’t care about food quality, or care about food waste or care about customer relations. A disgruntled employee (which is likely if you don’t practice good leadership) can cause you bad PR.  This will affect the other employees and could lead to theft.

The entire vibe of the shop will be based on your attitude, go in miserable every day and your staff will be also. You must put on your game face every day regardless of how you feel. Be light and jovial, have fun, joke around with your crew. Don’t dwell on bad things or mistakes, find the good side, make it a learning experience and move on.  You have to earn your employees respect.

Building Respect

Building respect will is crucial for any leader and takes time and effort.  You have to lead by example and this is an important way to begin building respect.  Begin by being punctual and consistent in your actions.  Learn every job in the business and spend time actually working each position on a regular basis.  Yes, wash some dishes when the you have a call in, work the line one a week for a few hours, close the kitchen every once and a while and let your staff go home early.

It is also important to respond quickly to your employees concerns, you may not be able to act quickly or at all, but let your employees know you hear them. Make sure you give respect to employees at all times and especially when they are wrong or make mistakes. Make sure the culture is one in which employees easily admit mistakes, as then know they will be treated with respect. You don't want your business to devolve into the drama of the blame game. Resist every temptation to blame others yourself, at the end of the day you as the owner are the one responsible. 

Ego

Let’s talk a little about ego. It can be tempting to let your ego get the best of you. You will have to try your hardest to put your ego aside in order to be a good leader and business owner.  If ego is your main motivation for opening a business then you may have trouble with this type of business. Maybe a business with no employees would be more appropriate.  If you want to open a business so you can boss people around and have your ass kissed, then think very hard about opening a restaurant let alone any business.

To instill leadership and garner respect from your crew you will have to be humble. Give credit to those who are due, give credit to everyone, just not you. Deep down you can be happy knowing the role you played in the success. You need to be gracious, forgiving and thoughtful. Your staff should feel they are wanted and needed for the success of your business. You should be thanking your staff all the time.  And make sure it is not fake sentiment, which can make the situation worse. Small actions can go a long way, holiday and summer parties, a few drinks after work, etc. Treat your staff like the family they are, they are your most important asset.

Keeping a positive attitude

It is imperative that restaurant leaders always have a positive attitude. Nothing can sink the morale of a ship more than the leader continually complaining or talking negatively about the business, customers or staff.  The culture of the business starts at the top, with the owner. How you act in the presence of your staff is how your staff will act in front of your customers. You must learn to keep your complaining and venting to yourself.  Find another person in your life (outside of your business) who you trust to chat with if you really need to vent.  Undermining your staff in front of others is a sure fire way to destroy morale and ruin your ability to lead and inspire others. Always put a positive spin on events, there is always a learning opportunity within every bad situation. 

Get to know your team...

It will be incredible important to get to know your staff, and not just their works skills.  Get to know them personally, ask about how they spend their time off work.  Having a personal connection will go a long way to building a great team.  Social events can be a great way to break the ice and have a chat with staff about no work items.  You should have some idea of the persons skills in the kitchen or front of house.  Use this knowledge to place people in appropriate positions and make sure they are properly trained. Throwing a staff member in a position they are not ready for is very stressful for some employees and lead to turnover. 

Having an understanding of a staff members ambitions will also pay off in the long run.  Some of your staff will be happy in the position they are in and not wish to move up in the business.  Others will and will let you know that they want to try a new position, some may be to introverted to ask. Your future super start line cook maybe stuck washing dishes and will eventually become unmotivated and possibly leave.

Being a mentor

The most important and probably most fulfilling role of an owner in leadership is that of a mentor. It is super rewarding to see a young high school student come out of their shell and interact with customers effortlessly. Or a shy line cook take on expo and manage a rush to perfection. Most of your staff will not come in with the skills and attitude necessary for the success of your business. Helping your staff develop their restaurant skills and life skills will pay off massive dividends. You will get the staff you want and minimize costly turnover. 

Take a class

You don't have to go get an MBA to learn leadership, but taking a few courses can't hurt.  There are a number of free resources out there like the list here from coursera.  Getting a formal take on how to lead people can be very useful. Here is a good article from Inc with more resources.

Being a great restaurant leader really just boils down to being a nice person, giving respect, mentoring, and leading by example. 

The post Restaurant Leadership, How Not to be a Tyrant. appeared first on Restaurant Coaching Online.

The “Deal”

So, what are these deals? Basically, Groupon sells "gift certificates" worth a given amount to its customer base for half the given amount.   A $100 gift certificate is sold for $50.  We hope you are starting to smell something fishy.  The restaurant must give out the $100 worth of food and Groupon is only collecting 50% of it.   Just wait it gets worse.  Groupon then keeps another 25% for itself.  Now things should look very bad.

The restaurant will only receive 25% of the value of food that it must give out.  It will only receive $25 for each $100 certificate the restaurant must honor.  The profit loss is so high that it is likely that the campaign will not even come close to bringing in enough sales to cover the cost of the Groupon.  The $100 of food will cost a restaurant somewhere around $90 (assuming 10% profit margin), of which Groupon will only give the restaurant $25.

Cost

The restaurant is losing $65 (The cost of food $90, minus your revenue $25) for each certificate that is sold.  These campaigns require different minimum numbers of certificates, but it is usually in the hundreds, which could bring the total cost of a campaign close to $6500!!!!  This they will not tell you.

The details may be slightly different, and Groupon will play around with the share amount.  It is imperative that a restaurant work the numbers on any given deal.  This is a huge cost, and because a restaurant only makes about 10% on the food it sells, it will have to sell $65,000 in additional food to pay for the ad.  These ads will not deliver that kind of return.

New customers

A restaurant may find a new customer from the ad, but it is much more likely that the deal taker is already a customer and just waiting for a deal.  We have seen restaurants that do these Groupon deals every couple months, with disastrous results.  The customers will just wait until they can get a Groupon and will not come in until then.  This customer will never pay full price for their food.

For $6500 a restaurant can do a very large radio or tv buy.  A campaign that will bring in the $65,000 in sales by increasing its profile in the community and bringing in long term customers, full retail paying customers.

Low Margin Business

Groupon deals may have their place, but low margin businesses are not it.  If a business’s margin is very high, like spas, lawyers or other service type businesses, then the numbers may work out.  Just not in a restaurant.  We hate to see naïve restaurateurs being misled and taken advantage of by pushy sales people and we hope it doesn't cost them their business.

There are other issues to be aware of with these deals.  One is that Groupon will not pay the restaurant right away, in fact it can take up to 90 days to get your 25%.  The restaurant will have to cover the cost of the full $100 of food, labor and overhead for up to 90 days, which can be deadly to its cash flow.  The restaurant is outputting a lot without anything coming in.

Stampede

Also, all the people get their certificates at once which can lead to a stampede of customers.  A restaurant can be caught unprepared and run out of items and wind up providing subpar service because you just can't handle the volume you may receive.  This can give a restaurants new customer a bad experience, one which it may not be able to get them back.  Then their bad experience can influence others as they are likely to post the bad experience on online review sites.

Will Groupon go away?

Thankfully many restaurants are catching on (or the ones that aren't are going out of business) and Groupon seems to be fading for restaurants at least.  Some of the imitators have tried to improve some of the bad aspects of Groupon but they are likely not worth it, even if you are trading for radio / tv spots.

Remember a restaurant only makes 10% or so on its food.  Any ad that costs more than 10% of the sales it brings in is not worth it, unless the intangibles are very good, like exposure or access to new customers.  We would say that the bottom line with these type of ads is don't do it.  In almost all cases they are not worth (no matter what the sales person says) it and the marketing dollars could be spent in much better ways.

Do you have a sales person hounding you about one of these types of deals?  Consider restaurant coaching membership, we would be happy to work through the numbers of a specific deal with you.

The post The Truth Behind a Groupon Deal appeared first on Restaurant Coaching Online.

Restaurant Food Cost

The basics of food costing include breaking a menu item down into all its components, including packaging. Then find out how much of each component is in each menu item, and how much that amount costs. Adding up the individual components cost will give a total cost of each menu item. The rule of thumb to use for pricing is to multiply the food cost by three to estimate the total cost to produce plus a little profit. It is imperative to understand the true cost of food production.

Rule of three

The multiple by three rule of thumb includes one multiple for the actual restaurant food cost, one multiple for labor, and one multiple for overhead (rent / insurance, and other fixed costs). The idea is to have food costs at about 30%, labor at somewhere between 20 - 30% and overhead at about 20%. Adding these up the total cost of food is 80 - 90% of sales price. Multiplying the food cost by three should leave you with somewhere between 10 and 20% profit margin.

Remember that every piece of food a restaurant sells must cover the labor and overhead cost. Food sales are the only income for a restaurant. These costs MUST be included in your food cost and pricing calculation. Managing these costs and keeping them under control is the real secrete to the restaurant business.

Bad pricing

Bad pricing has doomed more than one restaurant. Restaurants that are not priced right could be losing money with ever order. We see it all the time, restaurants try to undercut each other and lower their prices based on the competition. Not realizing they are selling the food for less than it costs to make it. While keeping up on competitors pricing is smart, using it to set prices will undoubtedly cause trouble.

Automating the restaurant food cost process to some level, will be valuable. Create a spreadsheet with all the food items on one axis and the all the components across the other axis. Entering the cost of each component and let the spreadsheet add it up. The benefit to having a spreadsheet is that it can easily be updated when component costs change and automatically recalculate the menu item cost.

Food Cost Example

Here is a quick example of costing out a cheese pizza with some made up numbers.

Components:

• Dough (0.96)
• Sauce (0.54)
• Cheese (1.25)
• Box (1.09)
• Wax paper (0.03)
• Oregiano and Parmesian cheese (0.10)

Total cost for this made up example is $3.97, so you should be charging around $11.91 or three times the cost for it.

Component Cost

Finding the cost of components can be easy, like dough balls, just dive the number in a case by the case price. It can be a little more challenging with a component like with cheese. Find out how much (in oz) makes a good pizza. Then calculate your cost per oz by dividing the package weight (in oz) by the package cost.

Now you have the cost per oz, and how many oz you need for a given pizza, so you can just multiply to get the cost. Very small use items can be estimated, like oregano. Think about how many pizzas can be made from the package size and divide. Just make sure to include everything in the menu items production. Don't leave anything out.

Food loss

Maintaining a good restaurant food cost can prove to be a challenge. It will all make sense on paper but can be a disaster in real life if a restaurant doesn’t carefully control the food cost. The main two reasons for bad food costs are food loss and bad portion control. Food loss can be cooking mistakes, dropping food (throw it out!), spoilage and prep waste.

New employees will make mistakes but with training and experience their cost for mistakes will go pretty much to zero (we all still make small mistakes, mostly they don't cost much). Restaurants should have a good training process, so the new staff can come up to speed quickly. Shadowing experienced employees for a few shifts can be very helpful.

Inventory

The management of inventory will be critical for minimizing spoilage. Best practices are to keep track of the items that are lost, so a reduction can be made on the next order. With smart inventory and ordering control a restaurant should be able to reduce spoilage to a very low cost. Monitoring of prep procedures will also help curb the wasting of a primary ingredient. With tight controls and training a restaurant should be able to drive food loss to a very small number.

Portion Control

The hard work of costing and pricing can all be undone without proper portion control. The profit margin of a restaurant relies on executing properly portioned food items. The pricing is based on a certain portion, get heavy with an expensive item and you will lose money. Restaurants that don't carefully control the portions, can have a true cost that is very different then what they think. Every item should have very tight portion control.

French fries should be weighted out and placed in portion bags, don’t let employees just grab handfuls. Have an exact amount of pepperoni for each pizza size, Use weights for other toppings. Find a cup that holds the right amount of cheese for each pizza size and make sure the staff uses it. 25% extra chees on a pizza can remove all the profit on that item.

Consistency

The other benefit to portion control is very consistent food which is very important for a successful restaurant. For example, sub meat should be weighed so that your costs are accurate, but also so that a customer gets what they expect every time. Make sure to document all the portion sizes on a laminated sheet and place on the wall so all the staff has quick reference to it.

Managing food costs, pricing and portion control are critical for a restaurant to be profitable. Restaurants must take the time to carefully cost out their menu items and update them on a regular basis. Being successful boils down to maximizing your profit margin, a number that is dependent on food costs.

Have a menu item you are having trouble costing out? Or don’t know where to start? Consider joining our coaching plan, we can help! We have starter spreadsheets available and can coach you through costing out your menu.

The post Restaurant Food Cost, Pricing and Portion control appeared first on Restaurant Coaching Online.

If you can’t find this situation then there are a couple other options.  One, buy an existing business with minimal refurbishing and two, build out a non-restaurant space.  Given the parameters of the type of restaurant we suggest, building a space from scratch can be expensive and should only be done if the cost is minimal.  In that frame of reference, we recommend the first option, buying an existing restaurant.  We covered the necessary details of the physical space in an earlier post. Here we will to talk a bit about finding and purchasing an existing business.

Craigslist

The best place to find an existing restaurant business for sale will be on craigslist under the for sale / business section (also sometimes in the commercial real estate section).   Search for restaurant and several listings should come up.  You can also try other online resources like loopnet, just don’t pay for a premium membership.  Most of the important details are accessible with the free membership.  It is possible to use a broker of your own but this will increase the cost to the seller as they have to pay the broker a commission.  The broker may not have you as a priority as you are only looking to invest a relatively small amount (remember we are trying to do this for less than 30K).  The brokers are used to much bigger deals.

NDA

See what craigslist is offering, reach out to the listings and ask to get a tour of the space as well as the financials.  In most cases you will have to sign a NDA (non-disclosure agreement) which is fine.  It is a document to protect the seller’s proprietary information from public disclosure.  It is agreed to not disclose that the business is for sale and any of the financials.  Just remember that if you sign one of these, it is imperative to protect the information you are given.  You could be held liable for leaks and sued, plus it is just not cool.

Financials

A little detective work will be needed in deciphering the existing restaurant businesses financial statements. They tend to be bloated with unrealistic information so take them for what they are.  Remember that the true revenue and profit margins are probably less than stated.  Why else would they be selling?  They should supply an equipment list, so you can get an idea of what they have and its worth.  They will likely overestimate the equipment’s worth.  Make sure you do your homework and can come up with your own estimate.  Google searches and website like WebstaurantStore should help get a ball park for the new prices.  Depreciate the value given the equipment’s age.

Know the area… financially

Getting your hands on a few different existing restaurant businesses financial statements can also be useful for your location research.  See how much revenue the businesses are bringing in per square foot, and see what area is doing best.  Do enough of these and you will have a pretty good idea of the area you are considering.  Try guessing the sales of each of them.  Can you guess based on their size and location?  You will get better with each one, soon becoming a market expert.  These skills will be very useful when estimating yearly sales for different candidate locations.

Equipment

The equipment is the most important part of buying an existing restaurant business.  There may be a bit of a premium to get the seller to feel good about the sale as they tend to get emotionally attached to the business.  Which is understandable.  Just make sure it is a great deal and the cost is less than building out a comparable space.  The goal should be to build your own business, so it doesn’t make sense to pay a large premium for the “name”.  Just pay for their equipment and a little good will.  Dealing with brokers will be a bit of a challenge as they will put on the hard sell and tell you that the existing customer base is worth a fortune.  Well it’s usually not.

Make visits

Set up appointments to visit the existing restaurant business and be cognizant of the sellers wishes.  Which might mean going when the business is closed to avoid their employees catching wind of the possible sale.  Get a full tour of the place and take pictures and videos (ask for permission first) of the space and equipment.  These pics will be instrumental when deciding between places, figuring out remodel costs, showing it to others and when coming up with an offer.

Remodeling

Get a feel for the age and condition of all the equipment and take notes.  You will quickly forget.  What will you have to replace or add that they don’t have.  How much remodeling is necessary.  Can you get away with just paint or will you have to build walls and counter tops.  Have a ball park estimate of time and expense to open each particular spaces.  Does it look like the sellers been investing in their business or do you see a lot of deferred maintenance?  Check the big-ticket items like HVAC, hood unit, water heaters, plumbing and grease trap.  Also find out what will the landlord fix or invest. You may be on your own.

Make an offer

I would offer what you think the equipment is worth (do your homework) and counter a little higher if the seller is close and the deal is still worth it.  Don’t get attached and pay too much, it will hinder your profitability down the line. Getting open for the right price is critical.  If you find a good deal and agree on a price, take the offer to your business attorney to look over and finalize the transaction.

Opportunities are out there, you never know what situation a person is in.  They might take your equipment only offer right away or not even make a counter.  It’s just business, move on if the deal isn’t very good for YOU.

Do you have an interesting business you are thinking about buying?  Consider a Restaurant Coaching membership!  We can help assess business opportunities.

The post Buying an Existing Restaurant Business appeared first on Restaurant Coaching Online.

We have already talked about what type of restaurant to open, so given those parameters what should you look for when searching for a restaurant space?  There are three main options, lease a former restaurant, buy an existing restaurant and finally, build out a non-restaurant space.

If you are reading this blog then I am guessing that you don’t have millions to build out a new space.  It will be hard to maximize your profit if you have to start from scratch.  It will take years or decades to make back your initial investment.  We don’t recommend this option for the type of restaurant that we suggest.  There are more than enough former and existing businesses around that will save the majority of build out costs.

Whether buying a business or just leasing out a former restaurant space, there are many items to look for in a space.  The better the restaurant space is setup already, the cheaper the opening cost will be, and the more profits you will make long term.

Front of house space and build out

Lets start by looking at front of house considerations.  The front of house is broken into two main parts, the dining room and counter space and area behind of the counter.  A space where your dining room can have a minimum of 6 tables each with 4 seats, up to a maximum of maybe 10 or 12 tables.  Remember you want to keep the square footage and overhead low.  

Two top tables work great as you can push them together for dinner and larger groups, then for lunch it is possible to set the dining room up as 2 tops as the diners will most likely be solo or pairs.  These will also allow for building 6 tops easily without totally losing another 4 tops.  This will allow for the best optimization of the space.  Counter style seating if the restaurant space has room can fit several guests in a small area, it also provides a great place for people to wait when ordering takeout.

Tables and chairs

The dining room should be cohesive with new matching chairs and tables.  It is worth spending some money to make the dining room as professional as possible.  Commercial table and chairs can be inexpensive if you do a little searching.  Don’t fall in love with those fancy $200 boutique chairs and tables, $40 a chair should do it.  Dark colors work well with most styles and will hide wear well.

The dining room should get a fresh coat of paint before and after you open.   It is imperative to make people feel comfortable and a nice clean space will do that.   Make sure the color of paint matches your theme and add some nice artwork or decor items that also match your theme.   Avoid cheap plastic items, really put some work into designing the dining room.  Get creative but keep it tasteful.  Avoid promotional items from suppliers, maybe one if you are promoting beer sales.

Menu

A menu board is an obvious must.  Try to avoid the standard type and do something different.  A large chalk board can work if you have an artist friend who can come in to add the menu items.   A large TV can work, the prices are plummeting an an 80 inch TV can make a great menu.  All that is needed is the menu design in picture form and a casting app on an inexpensive tablet.  Bonus: that tablet can play your music and show online orders.

Make sure the ceiling is nice whether it is ceiling tiles or just open, get it cleaned and painted and keep up with it.  Check the ceiling tiles for water damage which can be signs of a leaky roof and make sure the landlord will address it.  Replacing a tile floor can be very expensive so try to find a space where the dining room floor is decent.  Wood is good and can be refinished inexpensively if needed.  Avoid a carpet floor like the plague, they are wear badly, can be stained easily and can harbor nasty smells.  If a potential restaurant space has carpet take a peak underneath, hopefully there is wood, or even concrete which can be refinished stylishly these days.

You will want rugs for the high traffic / walk ways and should be vacuumed at night and during the day when necessary. Get a rug service like Cintas so you can get new ones each week (they can also provide aprons, dish towels and other items). Do your homework with these services, many will only offer long term contracts, try to avoid that and at least get a trial period.

POS

Moving behind the counter you will need a place for the customers to order, and I strongly recommend getting a POS (point of sale) system.  Be sure to do your homework there are many players in this market some good some bad and some horrible.  Look for another lengthy post soon on these systems.

There will need to be some space behind the counter for dining room supplies, plastic silver ware, napkin, garbage bags, straws, etc.  Also, behind the counter you will need a beverage cooler of some kind.  We don’t really suggest going with a soda fountain as it takes up a lot of room and limits what you can offer, plus you can deliver it.  If you have the room you may want to price it out, but there really isn't much difference when you factor all the costs.  

Beverage

You can usually get a cooler at no cost to you through your local or national beverage distributor.  They are usually happy to give you one (really just borrowing it).  Some conditions might apply so you may only be able to put their product in the machine.  Just check with multiple providers and see what they will offer.

Handicap access is important and may be mandatory in your area.  If the space doesn't already have easy access entrance, make sure it can easily be upgraded to allow handicap access.  Restrooms will be necessary, try to find a space with at least two, one for customers and one for staff. Having separate men's and women’s for customers is great if you can find it.  You will most likely have to deal with what your space allows, because adding restrooms can be expensive.

A good rule of thumb is to have about 40% of the space for counter room and dining room.  The kitchen and storage should be around 60% of the space.

Back of house space and build out

The layout of your space is going to be very different depending on your exact situation, so let's talk about some general ideas to help.  We already talked about the FOH where you will have a dining room and a counter area.  Hopefully the space will allow for the counter space to be in between your dining room and kitchen.  The kitchen can be walled off with a pass-through window or it can be open.

The kitchen will be anchored by your hood unit.  Finding a space that has a hood unit already with fire suppression system will be paramount. It is very costly to install one from scratch and most likely outside the affordability of this project, unless you are well financed.  10 or 12 feet of hood space should be sufficient to hold the necessary equipment.  Existing hoods can be extended to handle pizza ovens or other equipment easily.

HVAC

Make sure to test the HVAC system. Make sure the AC works and the heat works WITH the hood unit on. Look for some divider between the kitchen and front of house.  You need to vent the cooking fumes AND keep the customers conformable.  The hood unit can suck all the air-conditioning or heat out of a restaurant in a few seconds if there isn't a good divider and/ or proper make up air.  If the space doesn't have adequate makeup air you may have to crack the back door or a window to keep the hood unit from pulling all the heat or air from the dining room.

The main line should be across from your hood unit with a sandwich unit, pizza station and frozen food freezer right across from the hood.  If the space is large enough put some prep tables behind the main line and put your main refrigeration behind that to create your secondary line.  The second Holy Grail after an existing hood would be a walk-in cooler and / or freezer.  Walk-ins are very expensive to install, but not might not be 100% necessary.  It is likely that reach in fridges and freezers will be sufficient if the space doesn't have the walk-ins already.  Just keep an eye out for spaces with them.

Plumbing

The space will need a dish station, which may be set in stone depending on the plumbing situation.  Be sure to locate the plumbing and how it fits in to the kitchen layout.  The plumbing can be moved and added, but it may cost thousands.   Run the hot water for a long time to get an idea on the condition and size of the hot water tank.  Make sure it will be sufficient.   Check for a grease trap, they will most likely be required locally.  They can be expensive to install if the layout is not right.

Bringing in an electrician to run some new outlets may be necessary but can be affordable.   Try to find a friend or try trading food.  Opening a trade account for handymen or tradesmen can save a bunch of money.  They are often out on the road and need to get lunch.

Office

Keep an eye out for a space that can be an office, maybe the space will have a dedicated office, or a nook that can be used for one.  All that is really needed is a little space for a locking file cabinet and computer.  There should be a utility closet, and hopefully it has a mop sink, or you may have to put one in.  Check with the health department because the mop sink may be required.

The restaurant space will need a private place for a safe.  Maybe in a closet or in the basement, preferably somewhere where you can lock it up out of view.  A safe with a drop slot works great so your employees can make drops without having the combination.

The restaurant space is going to need three dumpsters, garbage, cardboard, and grease. Make sure the outdoor space has room for all three and there is a decent way to conceal them if they are not out of sight.  Hopefully these spaces already exist.

Visibility

A good restaurant space will have visibility from the street and or a nice sign on the street.  Make sure it has easy access from the road and a good number of parking spaces.  Five would be the absolute minimum and hopefully there are a few on the street or in other lots for overflow nearby.   Decent street appeal is a plus but not necessary.  Most pizza shops are in strip malls, so the public will accept it.  If you can find something unique that fits the other requirements, jump on it!  Make sure you can mold the location to fit with your theme.

The fact is there is no perfect location and if you wait for it you will never open your shop.  There may not be many options where you are, so you are just going to have to settle and make it happen.  The demographics of the area are more important than a perfect restaurant space so make sure to weight each factor appropriately.  A great area with a bad space is much better than a great space in a bad area.  Just choose a space in a good to great area with the least out of pocket costs.

If you have a space in mind, or would like some more details about the description above, consider a Restaurant Coaching membership!  We can guide you through a space finding decision.

The post What to look for in a Restaurant Space appeared first on Restaurant Coaching Online.

Your restaurant website is going to be one of your most important assets.  It is imperative that you design a professional restaurant website.  It will separate you from your competition, especially the local restaurants.  Customers are more and more turning to the web for information on the restaurants they want to visit.  Having a restaurant website is a must these days and keeping it up to date and professional will bring in more customers.  Building a professional restaurant website is not out of reach  and there are many tools and services out there to help you.

What is a domain

First things first you need to obtain, if you haven’t already, is your domain name.  This is the www.yournamehere.com address that you type into the internet browser.  It is very important the domain match your restaurant name exactly as your web search results will depend on it.  The best way to be at the top of a web search is to have the domain match the search term.  The best way to find a domain is to go to a domain broker website.  GoDaddy is a good option and offer the very good tools and interfaces with a comparable price.  You will need to renew the domain registration every year (you can usually also signup for multiple years), but most domain sellers offer easy or automatic renewal. GoDaddy’s renewal features work flawlessly so you don't have to worry about your domain expiring and someone jumping on it.

Get your name

If you have a business name in mind and the domain is available, you should probably buy the domain even if you are a long time away from opening.  The domain is like a de facto trade mark, although it doesn’t hold any legal rights to the name, it will hold the practical rights.  It would be very hard for someone to open a business with that name and get good web results.  Having the domain early is good practice so it is available when you open and you can build your website ahead of time.  Getting good search results can take some time so the earlier you start the better.

Let’s go buy it

Go to godaddy.com and enter your restaurant name (no spaces or dashes) in their search window and see if it is available.  If it is not available, then as hard as it may be, you might want to consider changing the name you are considering for your restaurant.  If you are already open and the name isn’t available, try adding a simple word to the beginning (or maybe adding your city to the end).

To also help with uniqueness (and thus searchability) try googling the name you are thinking of for your business.  You don't want something like "Tony's pizza" as there are probably thousands across the country.  You really want something that is unique country wide, just get creative.

Cost

When you find the right domain add it to your cart and by it for one year (or more).  They will try to sell you on extras, like privacy service and hosting, just decline them.  Typical one-year domain costs are about $15, don't pay much more.  Some popular domains are considered premium and can run into the thousands.  Don't get caught up in the hype, they might be worth it for a massive nationwide web business, but they are not worth it for a small local restaurant website.

Restaurant Website

Different options

Building a website is a little technical so you should choose an option based on your experience.  If you have the patients and learning ability you can do it all yourself.  The more you do the less it will cost generally.

Professional developers

Traditional website developers can charge up to $5000 for a simple site and it can take months.  You will get charged every time you need to make an update as you haven’t learned the skills to do it yourself.

Combined platforms

Squarespace.com and WordPress.com offer good options and tools for do-it yourself website building.  These providers combine webhosting with website development tools, making it simpler to get your site up.  Squarespace is priced a bit higher and can be limiting if you are picky about your design.  WordPress.com has a free option but it will not let you use your fancy new domain.  You will want to upgrade and use your domain and remove all the WordPress branding.  This plan is still very affordable under $10 a month.

Keeping your website clean by using your domain and removing the hosting platforms branding is super important to a professional look.  If you look professional people will assume you are!  Both these options are much cheaper than a full on professional development project, but they can still be limiting.  If you are willing to learn a little more you can have almost unlimited flexibility.

Separate hosting and developing

Our favorite option is to get a hosting account and build your own website.  It sounds daunting but it is only a little more complicated than using the combined platforms tools.  If you are comfortable doing some web searches and some trial and error, you should have no problem becoming a web expert!  Ok, maybe not an expert, but you will have the tools to maintain your restaurant website.

Website Hosting

A web hosting company is basically file storage in the cloud, that will allow you to publish your website.  You will have a web browser portal to your “cPanel” or dash board for your hosting.  Within this cPanel you will be able to set up email accounts, add domains to your account and if they are a good hosting provider, the tools to build your website.  Quick aside, having an email from your domain is very professional, like info@yourrestaurant.com vs yourrestaurant@gmail.com.  These tools allow you to do that.  We prefer HostGator as a provider as it is very affordable, less the $10 a month, and it has all the tools you will need.  Its interface (cPanel) is modern and very user friendly.  Once you have your hosting plan in place you will need to install your website software.

Website software

The domain you want to install the website on must be added to your hosting account, just go to your cPanel and click the “addon domain” button and add your domain.  This will create a directory in your cloud space to install your website software on.  Decent hosting platforms will have a couple different content management systems (the website software) available.

WordPress and Joomla are the most popular.  WordPress seems to out developing Joomla and we would suggest using it.  These should both be free to install, so don’t pay a premium for these, they should be included in your hosting plan.  WordPress has thousands of free themes and plugins to help make the perfect website for you.  It is also very simple to use and there are millions of tutorials and info on the web to help.

Go ahead and install WordPress on your restaurant domain.  You will be emailed a password for you to login at this address:  www.yoursitenamehere.com/wp-admin.  Now you can login to the admin side of your website and begin customizing.  There are many tutorials online to help you understand the WordPress platform and it will take some time to come up to speed, but it can be done.  Let’s now take a look on what your website should contain.

Restaurant website features

A "one page" style seems to be the fashion now and is very well suited for a restaurant.  All your information is listed on a single page so it is very simple for people to find what they want.  Pictures are obviously very important for a restaurant website so make sure to capture some when you have a chance.  Hiring a professional photographer is going to cost a lot of money and with a decent cell phone you can take some very good shots.

Your phone number and address should be very large and obvious on the top of the page after the header with your logo and background pic.  Having a picture of the inside of your restaurant on top is a good idea to let your customers know what to expect.  Make sure to add your location with a location widget which will insert a google map insert so people can find the shop.

Having a contact form and a feedback form is critical, the two can be easily combined with the appropriate form widget.  Every restaurant website should be collecting emails for the newsletter.  Mailchimp is a very good email newsletter provider that can easily integrate with your WordPress website and is free for small lists.  A restaurants email list is an incredible asset and it should not be taken lightly.  You get to advertise free to a list of your fans!  Make sure you capture emails and use them to your advantage.

Other sections

The menu should be right in the middle and the text should be written in HTML, do not just include a picture of your menu.  Your search results will suffer.  Make a black and white version of your menu for people to download and print.  Add a page for catering, and if you are not doing catering then start catering!  Include an “About You” section to allow your customers to learn more about you and the company's history.  Add a facebook widget to show your face book posts and drive cross traffic.  You can also include yelp and tripadvisor widgets which show your ratings (which will be great!)  Most platforms will have simple search engine optimization plugin, WordPress has many, which you should install and activate.

Summary

Whichever way you choose to go, just make sure that you get a website up for your restaurant.  It is the best way to get FREE online traffic into your brick and mortar restaurant.  A website can make or break a restaurant so don’t skip it.

We have built dozens of restaurant websites and are here to help.  Consider joining our team with a restaurant coaching membership.  We can walk you through building a website on your platform, like Squarespace or WordPress.com, or we can guide you through getting your own hosting plan and building your restaurant website in the cloud.  If it all seems just too much for you, we understand.  There are only so many hours in the day.  We can build a basic website one-page website with all the features a restaurant needs on your hosting platform or even host it for you.  We want to help you succeed!

The post Get a domain and create a restaurant website NOW! appeared first on Restaurant Coaching Online.

All restaurant owners have a love hate relationship with reviews and review sites.   Well maybe it is more like hate hate... but I digress...  Reviews are a necessary evil in the restaurant business as there is no way to avoid them.  Restaurant owners are trying to cultivate the best reviews they can, while trying to minimize the amount of bad ones received.  Of course the best way to avoid bad reviews is to have a great product and great service.  There is the reality however that with any amount of decent sales volume, someone will slip through the cracks.  A bad piece of food or maybe your staff was misinterpreted in a bad way.  

Restaurant owners will notice a category of reviewer which will undoubtedly cause a rise in blood pressure.  It usually goes something like this: "I eat here all the time" but has one bad experience and then one stars you.  So, they ate at your restaurant many times in the past and enjoyed it.  Then they had one problem and decided to tell the world about it.  Most of these reviewers haven't even posted a positive review on Google, Yelp, Tripadvisor or facebook.  

Restaurant Reviewers

Why not bring it to the restaurant's attention in a non-public way, 99% of restaurant owners will bend over backwards to make it right.  Give the restaurant a chance to make it up to you as you are a loyal customer.  Check their website for a contact form or email address.  You can try to call the restaurant, and ask for the manager.  Remember that the staff will be very busy during lunch and dinner rushes, so don't expect to talk for long then.  Try giving a call at off times or leave a message.  You can try facebook, but that inbox might not be monitored.  If the restaurant doesn't respond in a reasonable time (Give them a couple days) or try to take care of the problem then maybe it is time to leave an appropriate review on Yelp, Google, Tripadvisor or facebook.  You should also be willing to change or remove your review if the restaurant steps up and takes care of the problem.

Restaurant Owners

A little tip for restaurant owners, make sure you have easy ways for customers to give you feedback.  If you don't the reviewers will feel like they had no choice as you weren't listening.  A simple feedback form on your website should suffice.  Make sure your staff takes accurate messages and actually passes them on to you.  Also be sure to monitor facebook and other social media outlets for notifications.  I know there are a lot of channels, so make sure you have the appropriate notifications turned on.  Just make it easy for a customer to give feedback... oh, and actually respond.  Heading these problems off before they go wide is the name of the game for managing your online reputation.

If you don't have a website or a contact form on your website, consider a Restaurant Coaching membership!  We can guide you through setting up these tools and processes.  Give your customers the ability to provide feedback, it will be win-win!

The post A Quick Rant on Yelp, TripAdvisor, facebook and Google reviews appeared first on Restaurant Coaching Online.

There are plenty of people sitting at home wondering how it went bad.  How did this venture fail?  80% of restaurants fail in three years.  To beat the odds, you must be strategic in planning BEFORE you open your business.  The specific type of restaurant to open to maximize your chance of making a comfortable living working for yourself, is the fast casual restaurant.  A simple counter service fast casual type of restaurant with a small foot print and low overhead.  The trends are clear that this type of restaurant is thriving today.

The dream

It may be tempting to open your grand vision, spend hundreds of thousands of dollars in a 10,000-square foot space, totally renovated to your exact specifications.  This type of restaurant will need dozens of staff and managers, and you will have to run the bar until 2am every night.  Every restaurateur has had the grand the vision but to make sure you are one of the 20% that survive, is to learn how to tame the vision.  It needs to be trimmed down it in the right places.  The vision can survive through the overall theme and personal drive.

OK, so I just killed your dream and maybe you feel like there is no pride in operating a small fast casual type of restaurant.  You must look at what business ownership means to you.  Are you in business just to say that you are in business?  Will you only feel pride if you execute your grand vision business?  You should have the pride of operating a PROFITABLE business.  Maybe it isn't some large sports bar or fine dining fancy sit-down, but you will make money.

You will make money and you can do it in 40 hours a week (And with good planning maybe even less).  Maybe not at first as the startup will consume many days and nights, but done right you will have more free time than any of those fancy business owners.  You will be able to take great pride knowing you are making a good living for you and your family while also having the time to spend with them.

What type of food

The original fast casual restaurant is the pizza joint.  They proliferate every corner of America, and have survived for decades because it can be very profitable.  Chinese food has also successfully spread across the country in the take-out and delivery format.  Chances are right now where ever you are you can order pizza and Chinese food from multiple restaurants.  Keeping a small footprint combined with low labor needs create the perfect environment for profitability. 

Don't think you have to do pizza or Chinese to be successful in fast casual.  Almost any style of food can fit the fast casual type of restaurant. 

• Sandwich
• Burger
• Barbecue
• Wings
• Taco
• Burrito
• Waffle
• Asian
• Salads

Major chains like Chipotle Mexican Grill, Boston Market and Panera Bread have been fast casual from the start.  Fine dining groups have launched new chains like Shake Shack, and more fine dinning chefs are getting into the game.  It is hard to know if the market is following the consumer trend or the consumers are embracing the market trend.  What ever direction it is, the trend is clear that more people are eating at fast casual restaurants.

What does this mean for an restaurateur

The fast casual trend is great for the aspiring restaurateur as it allows for the creation of a business with low opening and operating costs.  The reason these type of restaurants are so popular from the business side is the relatively low cost and higher margins.  The fact that the consumer is embracing the concept is fantastic.  This opens up the space of opportunities for a restaurateur.   Strip malls, office building cafes and old pizza joints are all on the table now.  You don't have to build out a million dollar stand alone restaurant to be successful.  The fast casual restaurant, done right, can actually be cheaper and easier to operate than a food truck!  The sales to investment ratio will be very high.

Restaurant size

Size is money.  Costs will scale exponentially with square footage.  One of the best facets of a fast casual restaurant is is small size.  Opening a small fast casual type of restaurant will only need around 1500 to 2000 square feet and maybe even smaller if it is setup properly.  Benefits to a smaller space include:

• Lower rent
• Lower utilities
• Less staff and lower labor costs
• Less equipment and repair
• Lower maintenance costs

Location

A fast casual restaurant has the advantage of being able to fit in almost any type of space.  Because turnover at restaurants is high, there are many opportunities with previous shops.  Finding a space that was a restaurant before can save tens of thousands of dollars in start up.  Building a kitchen from scratch is quite costly.  Just remodeling one and adding a few pieces of equipment is a great way for restaurateurs to minimize your startup capital.  You may be surprised what is out there, you may be able to rent a fully equipped restaurant with a little premium in rent.  Landlords may offer rent to own on the equipment which is great to reduce your out of pocket costs.

Menu

Fast casual restaurants have simple but well-rounded menus typically adhering to a theme.  A small focused menu utilizing ingredients well will help to minimize food costs.  Many sit down restaurant have been killed by having a large unmanageable menu.  Simply being a fast casual restaurant necessitates a very optimized menu, which will lower food costs and drive up margins.  These menus can be executed very fast during peak hours, maximizing sales.  Fast casual restaurants have the speed and convenience of fast food while providing much better food to the customer.  Catering can be added to provide revenue without using front of house square footage, an advantage most fast food places can't do.

Labor

Labor costs are rising around the country and may in fact be driving some of the popularity from restaurateurs of fast casual.  The small menu helps reduce the prep and cooking costs, while the counter service alleviates the need for a swarm of servers.  Minimum wage hikes are a reality and restaurants are finding ways to cope with the added cost.  Full scale restaurants will have to raise prices to make up the difference or risk over working employees.  The fast casual restaurant is already optimized on labor, only needing what is absolutely necessary.  

Summary

Fast casual is clearly the type of restaurant that can deliver minimized costs and maximized profit.  Startup cost can be very small and operating cost can be very manageable.  Labor and food costs are as minimal as can be done, outside of fast food.  A good fast casual restaurant can provide a very good living for an aspiring restaurateur.

Our experts have opened fast casual restaurants and are here to help!  If you are thinking about opening this type of restaurant in the future or finding it hard to keep one profitable, consider a Restaurant Coaching membership! 

The post What Type of Restaurant Should You Open? appeared first on Restaurant Coaching Online.