Here is a fundamental question that restaurateurs need to ask themselves: Do you have a long term strategy for your restaurant or are you just focusing on getting short-term profits?
The answer to this question can have profound implications in the way you manage and operate your business.
For example, if you are just looking for short-term profits, then you don’t have to worry about having clear policies regarding how your staff should deal with customer’s issues. If a customer has a problem, you can take the short-term profit route and just refuse to compensate them if you see that they don’t deserve it. You will get their money instead of making them happy. Who cares if they won’t come back? You don’t want those kind of customers anyway right?
Same thing with your staff; if you want to increase your short-term profits, you will try to discount every single penny that you can from them. If they break something, you will discount it from their tips. If they eat, you will also discount the food, etc.
You will also try to understaff your restaurant so that your fixed costs are minimum and you can survive in these tough economy that we are experiencing and you will cut or eliminate your marketing expenses to a minimum or even zero…
Although this short term vision looks like a good idea in these times of crisis, this is a sure way to shoot yourself in the foot in the long run…
People are very sensitive to the way they are treated. And this goes not only for your clients but also for your staff. If you treat people badly (or even not as good as they think they deserve), you are saving pennies and expending dollars. A disgruntled customer will let other 100 people (it was only ten or 12 but now with the Web, it can be hundreds) know about their bad experience in your place. Unhappy employees will do all they can to make you pay from a situation that they believe is unfair. They will be more prone to steal from you and slack as much as they can. The worst part is that your clients will notice that their food has been cooked and/or served by unhappy people.
Saving in marketing is also a sure way to funnel customers to your competitors. All things equal; people will flock to restaurants that bring them incentives to go, and provide them with the emotional experience that they are looking forward to when they go out to eat.
If, on the other hand, you have (or are implementing) a long term strategy for your restaurant, then you already know that people are your main asset. Your clients are the ones bringing you the money, and therefore you should bend backwards to please them. Above all, never ever argue with them; even if this means giving them a free meal and compensating them so that they always leave your place happy and impressed with your service.
Same thing with your staff; if you treat them fairly and even give them an occasional bonus to compensate them for the extra effort that you see they put, they will be very motivated and happy to work for you, and this means that they will transmit their happiness to your clients.
Let’s now talk briefly about your marketing. This is a great time to evaluate how you are spending your marketing dollars. You shouldn’t stop marketing your restaurant, on the contrary, you should use this opportunity to implement efficient and inexpensive marketing vehicles that could bring you repeated clients. Use the power of referrals (you may want to check my Restaurant Referral System in a Box, it’s a very inexpensive and foolproof to bring back your best clients and their friends and families). Also, you should use the power of the Web to promote your business. Online sites like Twitter, Facebook, MetaFlavor, ResOS.net and other can help you spread the word about your place.
Yes, this may mean less cash in hand in the short-term, but you are establishing the foundation for a prosperous business for the long term. If you want your restaurant to succeed, you must create a long term strategy and follow it religiously. Any other action means sacrificing your most valuable assets looking for a short-term solution.
Jose L Riesco
©Riesco Consulting Inc.