The restaurant industry was hit hard in 2020 as the world grapples with the pandemic. Many had to shut their doors permanently, while others struggled to stay afloat. As a restaurant owner, you must know the common restaurant problems and challenges you may face— and how to deal with them effectively. Read on!

Common Restaurant Problems and Solutions

1. Inventory Shrinkage and Waste

One of the most common restaurant problems is inventory shrinkage and waste. This is caused by several factors, including poor stock management, theft, and spoiled food, which can result in high food costs.

To reduce shrinkage and waste, it is vital to have a good restaurant inventory management system in place. This includes regular stock checks, proper TCS food storage, and strict guidelines for staff. By monitoring metrics such as the inventory turnover ratio and sell-through rate, companies can ensure that they are selling through their inventory quickly and effectively.

2. Reduce Contact Between Customers and Staff

Another common problem facing restaurants is reducing face-to-face contact between customers and staff. This is necessary to protect employees and customers from the spread of viruses like COVID-19.

One way to do this is by installing plexiglass barriers between people. Another is to increase the use of restaurant technology, such as self-ordering kiosks, online ordering apps, and contactless payments.

3. Dining Room Capacity Restrictions

Many states and municipalities still need to impose capacity restrictions on restaurants, making it difficult to profit. One solution is to focus on curbside pick up and delivery, which don’t have the same capacity limitations. Another option is outdoor dining, which expands more readily than indoor space.

4. Heavy Labor Costs

Labor costs are one of the biggest overhead expenses for a restaurant and can significantly affect the profit margin. To reduce your labor cost, you can do a few things. One is to automate as much as possible, such as using restaurant online ordering systems. Another is to carefully consider your menu and ensure that every dish is profitable. It’s best to streamline your operations to require fewer wait staff.

The prime cost of a restaurant is the cost of goods sold plus the labor cost. Therefore, you also reduce your overall prime cost by reducing labor costs. This improves your bottom line and makes your restaurant more profitable.

5. Employee Retention

Several factors, including high turnover rates, cause the restaurant industry labor shortage. High employee turnover is a big problem for restaurants. It leads to decreased productivity and higher training costs.

To reduce employee turnover, creating a positive work environment is vital. This includes things like providing training and development opportunities, offering competitive salaries, and showing appreciation for employees.

6. Unique Selling Proposition (USP)

One of the main things you need to consider when opening a restaurant is how you will stand out from the competition. Developing a unique selling point (USP) in an oversaturated market can be challenging.

You need to ask yourself: what do you offer consumers your competitors don’t already have? What will make your restaurant business stand out?

Think about what makes your restaurant different and use that to your advantage. Are you using locally sourced ingredients? Do you have a truly unique concept? Whatever it is, something that sets you apart will appeal to your target market.

For example, if you’re targeting families with young children, your USP could include kid-friendly menu items and a fun, family-friendly atmosphere. If you’re targeting business professionals, your USP could be a sleek, sophisticated design and an extensive wine list.

7. Food Security Issues and Challenges

Another common restaurant problem is food security. This includes ensuring food is properly stored and prepared, preventing foodborne illness, and dealing with pests.

To reduce the risk of food safety issues, it is crucial to have a good food safety management system in place. This includes regular checks, inspections, and training for staff members.

8. Restaurant Management Team Structure

The structure of your restaurant management team can impact everything from employee morale to customer satisfaction. To create a strong management team, it is important to have clearly defined roles and responsibilities. Additionally, each team member should be skilled in their area of expertise.

9. Customer Service

Providing an exceptional customer experience is essential for any restaurant. To do this, training your staff in proper customer service methodologies is crucial. You should also ensure your staff is friendly, efficient, and always willing to go the extra mile for customers.

10. Restaurant Marketing Challenges

Marketing a restaurant is a challenge. To reach your target audience, it is essential to use a variety of marketing channels, such as direct-to-consumer advertising. D2C includes print advertising, online advertising, social media, and word-of-mouth. Additionally, it is vital to ensure your restaurant marketing budget is realistic and that you track results, so you can adjust your outbound and inbound marketing strategy as needed.

11. Lack of Automation

Another common problem facing restaurants is the lack of automation. This led to things like increased labor costs and decreased productivity. To combat this, it is important to automate as much as possible using restaurant automation tools and restaurant management software.

Such tools include integrated point-of-sale (POS System), perpetual inventory system, and order management software. Additionally, installing a self order kiosk and using restaurant robots for cleaning and cooking improves efficiency.

12. Online Reach

Utilizing social media platforms is an effective approach to establishing an online presence and initiating communication with potential customers. Additionally, creating an eCommerce website design that is easy to find and navigate increases your online reach.

Ensure your restaurant is listed in online directories. Use search engine optimization (restaurant SEO) techniques such as off page SEO for eCommerce and on page SEO for eCommerce to attract potential customers. Following these tips make it easier for potential customers to find your restaurant online and increase your chances of success.

13. Crafting the Perfect Menu

Restaurants often face the problem of crafting the perfect menu. To solve this, chefs can experiment with different recipes and ingredients to find the ones that work best for their restaurant. They can also research popular food trends and preferences among their target audience to tailor the menu accordingly. They can also offer daily or weekly specials to keep the menu fresh and exciting.

Moreover, it is important to balance dishes catering to different dietary restrictions and preferences. This can be achieved by providing vegetarian, gluten-free, or low-fat options on the menu.

By actively working on crafting the perfect menu, restaurants can ensure that their customers are satisfied and keep coming back for more.

14. Health and Hygiene

Restaurants often face issues with health and hygiene standards. The solution to this problem is for restaurant staff to regularly clean and sanitize all surfaces, utensils, and restaurant equipment. They must follow safety protocols like wearing gloves and masks while handling food and washing their hands frequently. 

Restaurants should also have a pest control plan to ensure no unwanted guests like rodents or insects enter the establishment. Regular health department inspections will help keep restaurants in compliance with regulations and help to maintain high standards of cleanliness and hygiene.

15. Serving More Customers Daily

As your restaurant grows, you will likely need to serve more customers daily. It is essential to have a well-trained staff and put systems in place that help increase efficiency. Additionally, you may need to change your menu, dining room, or restaurant seating strategy to accommodate the increased traffic.

One way to streamline service is by offering prix fixe or table d hote options. This speeds up ordering and reduces decision-making for customers. It also frees up your staff to focus on other tasks.

16. Supply Chain Disruptions

Supply chain disruptions are a common problem faced by many restaurants. In such cases, the restaurant's ability to receive timely and quality raw materials is affected, leading to challenges in food preparation and service. To address this issue, restaurants need to establish strong relationships with reliable suppliers and keep alternate supply sources as backups. 

Restaurants can also consider buying local produce when possible to minimize the impact of supply chain disruptions. Additionally, implementing effective inventory management systems and forecasting demand can help identify potential interruptions in the food supply chain and enable restaurants to take proactive measures to mitigate them.

17. Equipment Breakdown

Restaurants often face the problem of equipment breakdown, which can disrupt day-to-day operations and lead to customer dissatisfaction. One solution to this problem is to implement regular equipment maintenance checks and scheduled repairs. 

It is important for restaurant staff to keep a log of maintenance activities and repairs to ensure timely attention to any malfunctioning equipment. 

Additionally, having backup equipment can help mitigate the impact of equipment breakdown on the restaurant's overall operations. By taking proactive measures to address issues with equipment, restaurants can ensure smooth and uninterrupted service to their customers.

Frequently Asked Questions About Restaurant Problems and Solutions

When it comes to restaurants, there are a lot of common problems that can arise. But don’t worry, we’ve got solutions for every one of them. Below are some frequently asked questions left unanswered about restaurant problems and their solutions.

What Is the Most Common Mistake That Restaurants Make?

The most common mistake that restaurants make is not providing enough variety. When customers come to a restaurant, they expect to see a wide range of options on the menu. If a restaurant only offers a few different items, customers will likely become bored and not return.

What Problems Do Restaurants Solve?

Restaurants provide a solution to the problem of preparing food. They allow people to enjoy meals without having to cook them themselves. This is a convenient option for people who do not have time to cook or do not know how to cook.

What Makes a Good Restaurant?

The first thing that makes a good restaurant is the food quality. This is the most important factor, as no one wants to eat bad food. The second thing is the service. Good service makes up for many other shortcomings, turning a good meal into a great one. Finally, the ambiance of the restaurant is also essential. A good atmosphere makes the dining experience much more enjoyable.

You have read and heard that the restaurant industry has many problems.

But are you aware of what exactly is causing these problems, who are affected, and how it affects your bottom line?

Learn what we do, how we do it, and why it will help you solve the problems in your restaurant. Book a demo today.