The restaurant industry was hit hard in 2020 as the world grapples with the ongoing pandemic. Many had to shut their doors permanently, while others struggle to stay afloat. As a restaurant manager, you must know the common restaurant problems and challenges you may face.
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.
To reduce shrinkage and waste, it is important to have a good inventory management system in place. This includes regular stock checks, proper 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 the need to reduce 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 are still imposing capacity restrictions on restaurants, which makes it difficult to turn a 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. To reduce your labor cost, you can do a few things. One is to automate as much as possible, such as using an online ordering system. 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, by reducing labor costs, you also reduce your overall prime cost. This improves your bottom line and makes your restaurant more profitable.
5. Employee Retention
The restaurant industry labor shortage is caused by several factors, including high turnover rates. 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 think about when opening a restaurant is how you will stand out from the competition. It can be challenging to develop a unique selling point (USP) in an oversaturated market.
You need to ask yourself: what do you offer consumers that your competitors don’t already have? What will make your restaurant 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 be 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 and inspections, as well as 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 excellent customer service is essential for any restaurant. To do this, training your staff in proper customer service methodologies is crucial. Additionally, you should ensure your staff is friendly and efficient, and that they are 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 marketing budget is realistic and that you track results, so you can adjust your 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), perpetual inventory system, and order management software. Additionally, installing self-service kiosks and using robots for tasks like cleaning and cooking improves efficiency.
12. Online Reach
There are many ways to reach potential customers online. Social media is a great way to connect with potential customers and create an online presence. Additionally, creating an eCommerce website design that is easy to find and navigate increases your online reach.
Finally, ensure your restaurant is listed in online directories and use search engine optimization (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
Creating a menu that appeals to your target audience can be a challenge. Researching your target market and understanding their likes and dislikes is essential. It’s good to consider food trends, dietary restrictions, and pricing.
14. Health and Hygiene
Maintaining proper health and hygiene standards is essential for any restaurant. It is important to have a good cleaning routine in place and ensure all staff members are trained in proper food handling procedures. Additionally, you should regularly check for things like pests and mold.
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 make changes to your menu or dining room to accommodate the increased traffic.
16. Restaurant Management Team Structure
The structure of your restaurant management team significantly impacts your business. To ensure your team is effective, it is crucial to have the right mix of skills and experience. Consider things like communication styles and personality types when putting together your team.
17. Supply Chain Disruptions
The pandemic disrupted the food supply chain worldwide, making it difficult for restaurants to get the ingredients they need. One solution is to source from local suppliers, who are less likely to be impacted by global disruptions. Another option is to build up an inventory of non-perishable items so that you can weather any short-term shortages.
Frequently Asked Questions About Restaurant Problems and 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, it is likely that customers will 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 a lot of other shortcomings, and it turns 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.
Revolution Ordering is an off-premise, omni-channel, direct delivery-enabled ordering platform for individual, franchise, middle market and large multi-unit restaurant enterprises. Take advantage of cutting edge features including 360° order history, live order monitoring, and marketplace order insertion. Contact us for a demo now to see how our off-premise solutions can help grow revenue and earnings of restaurants. Note that Revolution demos are a walkthrough of our software, not a source of business advice.