Restaurants are now hotter than ever. The National Restaurant Association estimates that today there are more than one million restaurant locations in the United States. People in the US now spend more on dining than they do in grocery stores. The Atlantic is calling this the golden age for restaurants, while also pointing out that it’s a fiercely competitive industry.
If you’re considering a business move by opening a restaurant, we offer this two-part blog series (read part one here) as your go-to guide to setting up for success.
1. Choose technology that works as hard as you do
From multi-store retail outlets to intimate mom-and-pop shops, business owners know that technology is essential in today’s personalized, omnichannel world. Increasingly retail stores are turning to a super multi-tasking POS to do the job.
Accepting payments is just the start when you have the right system. Here are some other functions your hard-working POS can handle:
- Customer database
- Inventory tracking
- Employee management, productivity tracking and training
- Marketing with receipt customization and coupon tracking
- Gift card program
- Loyalty program
2. Find your suppliers
From tables and chairs, to ingredients, straws and table tents, begin by making a comprehensive list of necessary supplies. Is it more effective for you to use separate vendors for different categories or stick with a supplier who can make it easy to buy multiple types of supplies with one-stop shopping? Each approach has pros and cons; for example, dealing with one account manager can simplify billing and vendor relations and could yield cost savings through reduced delivery costs and bulk-buying opportunities. On the other hand, finding specialty suppliers might allow you to get products that otherwise aren’t available and could allow you to find better prices on specific items.
A good place to start is by asking other local restaurateurs for suggestions and/or visiting an online marketplace like FoodServiceCentral.com. Make sure you get a variety of bids and take into account the customer service each supplier provides. You want to feel confident they will be a great long-term partner.
3. Staff up
According to the National Restaurant Association, there will be 1.6 million new restaurant jobs created by the year 2027, which means there will be lots of competition for top-notch employees.
Attract the best by offering competitive pay—for reference, your payroll should run between 25 and 35 percent of revenue—and as many perks as you can. Boost compensation further with a flexible menu that encourages upselling and screen-based tipping. Both tools, available on POS systems like Instore, will enable bigger tips.
Depending on your model, you might prefer to have a few people who can work longer hours, or cater to students by hiring more employees who work shorter or fewer shifts. Also consider instituting a bonus program to incentivize good employees to recruit their family and friends. Develop a way to reward long-term and good service with a retention program. With turnover rates in the hospitality industry exceeding 70 percent, the cost to replace an employee is far steeper than keeping the ones you have happy.
You’ll also want to offer comprehensive training, which not only promotes excellent customer service, but can inspire loyalty in employees who feel more confident in their abilities. Technology to the rescue, yet again: A major benefit of an mPOS is how intuitive it is for most employees to quickly get up to speed, given their familiarity with the interface.
4. Bring in the crowds
Start building the initial buzz with a range of approaches:
- Design and execute an inspired social media marketing campaign.
- Distribute coupons. Are you near an office? See if you can capture the before-work coffee buyers, the lunchtime crowd or the after-work relaxers, depending on the type of food you offer.
- Push BOGO. Rather than offering a straight discount, this technique will encourage the buyer to bring a friend, exposing another guest to your delicious offerings.
- Add coupons to your receipt. This is super easy with a modern POS and will encourage them to come back again.
- Institute a loyalty program. These can be huge for encouraging repeat traffic and easy to implement with the right POS.
- When you’re fully up and running and confident in how operations are running, invite the influencers for your target market.
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