5 Steps for Restaurant Success in 2019.
The year is finished and another one for your restaurant is in the books. Hopefully it was a good one. Enjoy the moment because another year is starting up for your business.
Last year the industry saw many changes that will impact your business in 2019. The tax cut did put new money in the economy with new jobs and increased take home pay for many. Third party delivery services seem to be popping up everywhere as the chains embrace this strategy to grow their business for the future. Restaurant labor is getting very tough to find, manage and retain as the economy continues to expand. Food costs has not seen much inflation, but minimum wage increases, and a tight labor market have driven up cost.
First steps are always to assess where you have been and where you are going. Do you know what your prime cost for the year was? Over the year I have seen these cost centers run from a high of 72% of sales to a low of 58% of sales with various restaurants. For an average size restaurant, getting your prime cost down to 62% or lower can mean as much as $50,000 to the bottom line. Setting action steps to reduce your prime cost is a primary goal for 2019.
While food inflation may be low, restaurant labor cost and supply chain distribution issues will continue to be a cost driver for the next year. The next action step is to review your menu and make changes for the coming year. New items that meet consumer demand, competitive retail pricing, pricing strategies on specials are just some of the topics you need to look at. Also, you need to consider the cost of third-party delivery services in your pricing equation if you use that as a strategy. This marketing strategy is not going away and will increase as a competitive tactic to grow your business? Where do you stand on this issue?
Understanding your restaurants internet reputation is also part of the planning process. The continued growth of smartphones as a search tool have consumers looking for your restaurant on the internet for where to find for your location and menu. While surfing the web, they will also see your review scores and comments left from other consumers. Managing this reputation is critical to attracting new customers. Food quality and service excellence are critical to growth in 2019. Understanding where you are currently along with 90-day trends are important to setting up goals for improvement with your staff.
Restaurant marketing continues to evolve as technology changes. Facebook continues to be a leader in marketing with advanced targeting options. Instagram is also very effective is presenting your food story in images. Email and loyalty programs are still very effective in communicating directly with customers who have enrolled in your database. Selective print media can be effective as well along with traditional community involvement programs. Each of these tools are part of an integrated marketing plan which should be developed in advance as part of an annual and quarterly marketing process.
Developing your profit improvement plan for 2019 is the next step of the process. You have done your analysis of 2018 and found the areas that can show improvements in the new year. That was a critical step for success. Executing the plan is the key step in the process that many restaurants fall short on. To many things to do, not enough time, not sure on how to get it done are some of the reasons. Leadership and accepting change are often problems that needs to be dealt with. You will not see improvement without being the leader. Can you do this? Will you do this?
At CORE Restaurant Marketing, we have helped many restaurants design and execute a business strategy. Our mission is simple, how can we help restaurants succeed? Our services we offer and the experts we utilize have generated proven results for restaurants of all types. Contact us at firstname.lastname@example.org for more information or schedule a time to speak with one of our restaurant marketing coaches.