Once people try your restaurant, you know they'll come back. But how do you get them in the door?
Most small, independent operations can't afford a splashy media campaign. "You'd have to sell a lot of burgers and wings to make up for the cost of radio and TV ads," says Ellison. "We did a grand opening with free beer and wings just to get people in here. We went door-to-door, passing out fliers. The rest of it has been word-of-mouth." Ellison's experience as a manager has also helped; customers of the place where he worked have followed him to his own restaurant.
Ellison stays away from coupons. "The people you get with coupons are people who only come in when they have a coupon," he says. "If people are taking dollars off your meals, you're charging too much to begin with. Instead, give people good food at a good price and good service, and word-of-mouth will travel."
"The best marketing you can do is have an owner-operator on the floor of a restaurant," says Redler. Display your business card at the host stand or near the register. When you personally greet guests, let them know you're the owner and that you want to be sure their experience is positive because you want them to come back.
When planning your marketing, consider what's going on in the community. "Look beyond your front door," advises Larry Schuler, 42, who owns Schuler's Restaurant, a fine-dining establishment in Stevensville, and Schu's Grill & Bar in St. Joseph, Michigan. Evaluate the things that can affect your business both short- and long-term, he says. If there's a convention in town, will your volume increase? How will local or televised sporting events affect your operation? Pay attention, and you'll manage more efficiently and profitably.
More Than a Good Meal
Even in its simplest form, Melman says, the restaurant business is sophisticated. It takes knowledge, experience and hard work. "Sometimes, you have to be a little lucky," he adds.
"Don't try to do everything yourself," Gilbert advises. "Surround yourself with good people." In particular, she adds, make sure you have someone to stay on top of the paperwork.
Schuler advises joining your state restaurant association and the National Restaurant Association, along with local business networking groups. Take advantage of the information resources you have. For example, most credit card companies will provide you with detailed demographic reports on your customers who use those cards.
Once you're up and running, listen to your customers. They'll not only tell you what they want to see on your menu, but will also give you clues about the business climate of your community and how restaurants need to change to meet evolving lifestyles. After all, says Schuler, "Successful restaurateurs listen to the customer, evaluate their needs and figure out where that will take them in the next eight to 10 years."
The Human Factor
People are a critical component of the restaurant business. Not only is the operation itself labor-intensive but guests will remember--and talk about--poor service long after they've forgotten how good the food was. Managing your human resources must be a top priority. "I tell employees we work for them--they don't work for us," says Bill Ellison of Frasier's. "It's our responsibility to make sure they have the training, the equipment, the food and beverage to get their job done."
Here are some tips to help you find and keep great people:
- Hire right. Take the time to thoroughly screen applicants. Be sure they understand what you expect of them. Do background checks. If you can't do this yourself, contract with a human resources consultant to do it for you on an as-needed basis.
- Create detailed job descriptions. Don't make your employees guess about their responsibilities.
- Understand wage-and-hour and child labor laws. Check with your own state's Department of Labor to be sure you comply with regulations on issues such as minimum wage (which can vary depending on the age of the workers and whether they are eligible for tips), when teenagers can work and what tasks they are allowed to do.
- Report tips properly. The IRS is very specific about how tips are to be reported; for details, check with your accountant or contact the IRS (or see your local telephone directory for the number).
- Provide initial and ongoing training. Even experienced workers need to know how things are done in your restaurant. Well-trained employees are happier, more confident and more effective. Plus, ongoing training builds loyalty and reduces turnover. The National Restaurant Association (202-331-5900) can help you develop appropriate employee training programs.
Want more tips? Read Entrepreneur's business start-up guide How to Start a Restaurant and Five Other Food Businesses, available at www.smallbizbooks.com.
Jacquelyn Lynn is Entrepreneur's "Insurance" columnist.