There is no question that having a great menu, friendly, knowledgeable employees, and appropriate décor, furnishings, and ambiance are must-haves when it comes to being successful. However, no matter how great you are on your best day, it matters how great you are every day. No matter how good everything else is, if there is one thing that can ruin a great business, it’s inconsistency.

In the past, restaurants that were in high-traffic locations and/or did not rely on repeat business did not have to worry about this as much because there was an endless supply of new customers. Now, with the many sites for posting reviews, there is no escaping the wrath of a customer who did not have a great experience.

There are several reasons for inconsistency:

• • Volume exceeds capability,
  • Disorganized work areas,
  • Inconsistent processes,
  • Disengaged Employees,
  • Lack of training, and
  • Lack of standard procedures/recipes.

Let’s look at new operations or operations that go through a significant change (ownership, menu, chef, or concept). Usually, in these cases, everyone is on a high. They are hyper-focused on standards, have the support to coach the team, and have the energy to combat any surge in business with ease. You would think that there would be very little that could harm an operation during this honeymoon phase.

In the excitement of a new build or any change, it is important not to lose sight of having all the right financial systems and structures in place.

Everything Seems in Order

You have hired the right people, training and service standards are in place, the perfect POS system is purchased, the website is designed/updated, third-party delivery companies are on board, menus are printed, pricing is in line, equipment is in place, food and beverage are ordered, and the list goes on. All the makings for a successful and consistent restaurant are in place, what could possibly go wrong?

Too often problems begin as the honeymoon phase wears off and owners/investors and managers are looking at the bottom line. Everything is in order, revenue is meeting or exceeding targets, customer reviews are great, and the staff is happy, but the bottom line is not meeting the expectations. At this point, there are several ways to analyze the situation to come up with the right approach, but many times people are looking for actions, not “excuses”.

What happens next? Cost cutting – the beginning of the end.

How a Once Great Soup Ruined a Business

My wife and I went to a new restaurant that opened in the resort town we were living in. The owners did a great job. They had perfect style, décor, service, and the menu and food were fantastic. My wife, being from the east coast, was excited to see a seafood chowder on the menu. She ordered it, and it was exceptional. In fact, all the food was very good, but it was the chowder that made us return to the restaurant every week.

Some friends were in town, and we wanted to treat them to something special, so we took them to our new favorite restaurant where we all ordered the chowder. We waited in anticipation to see the joy it would bring them. Then it arrived.

What happened? The chowder changed. What was once a creamy, rich, and delicious concoction with fresh seafood became a sparse, milky, and mediocre soup. We asked the server what happened, and she shrugged and said, “I don’t know what they are doing,” and pointed towards the kitchen.

After that night, we went back the following week, hoping it was an isolated incident. It wasn’t, and there were other noticeable changes. They did not have consistency with their food. It was the last time we went to the restaurant.

What Caused this Tragedy? 

In the beginning, they did everything right. They started with a great concept and a well-constructed menu. Their downfall was they were so caught up in everything else that they didn’t properly cost the menu items to fully understand their profit potential. Especially the chowder, their signature dish. If they had taken the time to do things properly in the beginning, they would have priced the soup appropriately and ensured that it and the other menu items were profitable.

How Could they Have Avoided this Critical Mistake?

Once they realized the profits were not meeting the projections, they should have gone back to the basics. Start with taking the time to create the recipes. This would have helped them identify some of the more obvious issues. Not stopping there, the next step would have been to conduct menu engineering.

A menu engineering exercise would have uncovered several ways to increase their profit and develop a strategy to make the necessary and subtle adjustments to their recipes, menu, and pricing. In the case of the soup, they would have realized that due to the popularity, the quality of the soup should not be tampered with, and a price adjustment may be in order. We always thought it was too good of a deal and would have accepted a change.

The Problem with Recipes

They most likely did a quick calculation and found the seafood chowder cost was too high. But was it?

The cost was most likely too high, but since it was a way to use the trim from the other seafood on the menu, they should have looked at it differently. I could type 500 more words, and it still may not make sense. Schedule a call to learn more about the value of trim.

The fundamental systems and financial controls may not be as energizing or exciting, but their importance and value can never be understated. Your best investment and ROI is to work with a food & beverage expert that can provide a thorough and detailed review of your new or existing operation. This allows your team to focus on the other aspects of the project and will not only save your operation from these types of mistakes but to help maximize your profit potential from the beginning.