Businesses in the hospitality and catering sector (restaurants, pubs and hotels) have a 59 per cent failure rate in the first year of opening, according to a study by Professor Dr. HG Parsa of Ohio State University. There’s also another statistic out there which says that 80 per cent of restaurants fail within the first five years.
Whilst there is no denying the fact that running a hospitality business is hard, there are a number of steps businesses can take to increase their chances of success.
Here are some general tips to help your hospitality business succeed:
- Combo meals are a good revenue driver. Increase sales volumes by varying the combinations available and provide a range of side options to choose from.
- Offer different portion sizes – small plates, half portions, sharing platters.
- Ensure your front of house is providing an excellent dining experience by making customers feel welcome, important and valued from the minute they arrive. Train your floor staff well, so they are polite, attentive and proactive. This will go a long way towards encouraging loyal, returning customers.
- Put effective stock control procedures in place which will improve customer satisfaction, efficiency and profit margins. A data-driven approach to controlling your stocking volumes can also improve the odds of the profitability of your business. Capcon, for example, provides an Electronic Cellar Management System, aimed at maximising accuracy, improving supplier negotiations, highlighting variances, revealing profitability and using tactical promotions.
- There are also a number of measures you can put in place to reduce food waste
- Use technology to provide improved point of sales systems. The iPad point of sale systems, for example, accepts different payment systems such as EMV cards and Apple Pay.
- Undertake mystery guest visits, carried out by experienced assessors, posing as real customers. This will help to ensue your brand is protected and identify sales opportunities, both of which are essential to your current and long-term success.
At Beavis Morgan, we have extensive experience of working with clients in the hospitality sector and our professionals are acknowledged experts in issues affecting restaurants, pubs and hotels.
Through our partner businesses, BM Structured Finance and BM Advisory, we are able to help with sourcing and restructuring debt finance for SME businesses, as well as assisting with resolving issues which can impact on business performance and success, and finding innovative solutions for businesses and individuals in distress.