Starting A Restaurant Blog|Starting and Owning a Restaurant - Construction, Planning, Marketing, Opening and Managing a New Restaurant

If you have followed the last nine months of the journal on how to construct, open and operate a restaurant, you know that, at a general rule, we don’t like or use general coupons that serve no purpose other than giving a discount off your menu. In fact, it is very possible that you can condition your guests to only visit you when a coupon is available. You might as well just lower all your prices and advertise the low pricing policy you created. Not very wise in this uncertain market with the chains below cost mentality.

On the other hand, coupons can be a successful marketing tool if used for a specific goal and tracked for their success accurately. Here are a few types we are considering as our summer business seems to have reached a plateau;

• Bounce Back Coupon - The best place to start developing more business is with your existing customers. Offering an incentive for a return visit or a reward for some activity on your behalf can be used occasionally. For instance, if you are trying to build business on a certain day, for a certain menu item or time slot during the day. You can also offer a “Reward” coupon. If a guest usually comes in alone, offer a discount if they bring a friend. If a couple comes in frequently, offer the couple a discount if the bring another couple.
• Charity Coupon - If there is a group, cause or event you support within the community, offering a coupon that can be used for that charitable purpose may serve the purpose. An example could be offering ten percent of a guest’s check amount to a specific church if they bring their church bulletin on Sundays. Flat rate donations such as a coupon given to a charity for an event. If they bring the coupon in you will donate “X” dollars to the cause.
• Menu Highlight Coupons - Introducing new menu items can be a challenge. Restaurant guests seem to order their favorite menu items and don’t venture too far. You can offer a limited coupon as an incentive to try single or multiple new menu offerings.

These are just three uses of coupons that serve a purpose. They have a specific audience and/or purpose. It is critical that the response be tracked for future use or relevance to your restaurant’s goals.

Nothing has challenged the restaurant industry like the past 18 months. Rising prices, lower discretionary spending by consumers and chains offering junk food at or near cost. The battlefront starts with getting return visits from guests who want value. Rich or poor, everyone is looking for the value in every dollar they spend.

One conerstone of the total value experience is what’s on the plate. Is the coverage good and is it exceptional for the dollars spent? In the breakfast and lunch business we have had to make sure the diner perceives every menu item as a good way to spend a few dollars as compared to the competition. Creative garnishes and fillers keep meeting the guests expectations in terms of quantity.

To find that creative inspiration look to your inventory list. What are the items have a low cost and high margin, but offer good plate coverage? Here are a few we use:

• Eggs - last year this time we were paying double what we pay now for eggs. An egg costs under ten cents each. Gives good color and coverage in a variety of ways.
• Grits - low cost and easy to hold, prepare and cook. They also can be used in a number of ways from polenta to baked cheese grits. The same applies to oats, barley and other grains.
• Flour - wheat has almost doubled in price, but the overall value of this ingredient is limitless. Used for flatbreads, easy cakes, pastries and dough can produce some inexpensive plate fillers that can offer something extra that enhances the customers experience. Pancakes, of course, lead the way in the breakfast business. Adding a couple of savory silver dollar pancakes or Johnnie cakes to a lunch item will get the guest’s attention.
• Vegetables - prices across the board are much higher for fruits and vegetables. However, there are still some relative bargains like potatoes, various other roots like yucca and carrots. One of the biggest fruit bargains continues to be bananas which can be made into various components like filler for cakes, sauteed like bananas foster and filler for pancakes and crepes.

Start your creative thinking with an inventory list and a few Google searches. Ideas may be a click away.

One of the key elements in surviving the current economic climate is changing as the consumer changes. Value is subjective. Walking a tightrope of offering the guest new and exciting menu items while meeting price point expectations can be difficult. Most restaurateurs wisely avoid harming their brand by just lowering prices or blasting the world with coupons. They look for proteins and center of the plate options that keep margins, but offers the consumer a perceived bargain. Sometimes it has been easy to view suppliers as a necessary evil rather than a working partner. The suppliers made it easy to avoid them by being great order takers, but poor innovators.

We recently accepted an invitation from the country’s largest foodservice distributor, Sysco, to tour their facility and view a custom presentation of their ability to offer fundamental assistance with plating alternative dishes and consider other products that make sense in this price conscious atmosphere. We had our reservations about taking the time to spend watching another “dog and pony” show.

The suppliers are listening and learning in a new marketplace just like independent restaurants must do. Our trip wasn’t wasted.

Sysco tailored their presentation to our restaurants and the products and services we could actually use. Many times suppliers want to sell you what they want, rather than show you what you want. The in-house chefs not only prepared many of the alternative products, but plated them fresh for our review and tasting. All of the food was a potential item for our concepts rather than a shotgun approach that wastes everyone’s time. It was very clear there had been a line of communication from the street level to the executive level well in advance of our visit about what our particular restaurants were about. Refreshing and rewarding is the best description of our experience.

While I have never understood chefs and restaurant owner/managers who maintained a contentious relationship with suppliers, I also never understood suppliers who turned customers off by trying to sell prime boxed beef to a taco street vendor or imported pasta to a breakfast joint!

Maybe the economic downturn has forced the entire industry to reevaluate the way we do business. Everyone is realizing that the survival of the independent restaurants in this country is at stake. The chains will feed on themselves, each other and their shareholders. The independent restaurateur doesn’t have the luxury of selling or closing a few units to keep profits up. The small operator must focus on the consumer, their expectations and pocketbook. To meet the guest’s perception of value it takes creativity, marketing and constant ability and willingness to change.

If you want to utilize your foodservice suppliers to help you through these turbulent times, be open, honest and thorough in letting them know your objectives. A half dozen people working in the background for you can inspire new ideas, refreshing outlooks and discovery of techniques that can save a few dollars, offer the guest a better experience and keep the doors open to welcome new diners.

The industry will face big hurdles in the coming months. No matter how big or how small your operations are, the time for action is always now. Contact your suppliers today for available resources that can add a new dimension to your search for products, marketing tools and resources to put more butts in seats, more frequently with more help than ever before.

While testing and tweaking the menu for the new restaurant we built, several interesting concepts have been explored. Three issues were considered for the long term success of a particular dish. What makes it sell for an extended period of time?

Some would argue that in this economy, for a casual restaurant, the key is the price. That is certainly partially true - only to the extent there is also value. You can offer a 99 cent hamburger and sell it, but will the guest order it again? Only if the other two components are present - eye appeal and taste. There are many chains out there dragging customers in with very cheap specials. Will the customer return and buy the product again? In most cases the answer is no if it is not perceived as a value.

While testing, we stumbled on one dish that featured a low cost, extremely good eye appeal and great taste since it was a smaller combination of items already on the menu. The combo’s sales built for the week long promotion. Customers came back several times during the week. Sales grew daily of that item. When that happens, you have the “perfect storm” of menu item creation.

The best part was that we were able to produce the item within our food cost parameters (25%). Let the creative juices flow and keep your inventory and food costs close at hand.

A new restaurant operation is like bringing a puppy home from the dog pound. Everybody loves it, but you are the one who is up all night with the crying and yelping, cleaning up the messes until trained, picking up the chewed new pair of shoes and tripping over the ball of fur with every step.

From the outside, the puppy is cute and cuddly - just like a new restaurant. No one sees that you are scrambling to train staff, get the food out of the kitchen perfect, adjusting schedules, paying unforeseen invoices and hoping there is enough cash flow to make at least your break-even point. It’s a nightmare.

The first 30 days of any restaurant operation cannot be evaluated. Sales are driven in many cases by the curious who just visit because you are new. Costs are escalated due to extra staff, over ordering of product and the usual smallwares you need that were not in the plans. Throw the first thirty days out. Don’t try to judge your future based on your first month.

The days that count are the 100 days that follow the opening month. These are the days when reliable and predictable trends begin to develop. The “Big 100″ (100 days following your first month) are the days that can tell you what you need to do and set the tone for further growth and profitable enhancement. Here are some things that should emerge with your analysis;

• You should be able to accurately discover what your exact daily break-even number is.
• You should see a trend of lower operating costs that should be going down due to tweaks you make as you age. Food costs should be concise as compared to sales.
• There should be a clear picture of what your marketing has done and the demographic draw of existing business.
• The Big 100 should have produced the numbers that allow you to go back and compare to your plan. Are there adjustments necessary to the plan or your operation? What were the biggest surprises? What were the biggest disappointments? What new goals do you need to establish? Is your menu where it should be?

The Big 100 is the platform for you next 6 months of planning. What marketing changes do you need to make? What food trends do you want to expand? What internal changes need to be made to reduce costs or waste? Staffing changes? Hours of operations? Does the seating, lighting, decor and customer areas need adjustment? All of these questions and many more become the basis for your new business plan.

We are in the midst of building our social marketing blog for the new restaurant. The basic structure can be viewed at Maggie’s City Center. While the design, colors and other aesthetics may be slowly tweaked, the elements are pretty much static.

Now is when the marketing begins along with the real value of maintaining the blog. Our plan will include;

• Getting content for the site by discussing it with individual customers as they come in. We want to get business people listed in the reference sections of the blog. The communication builds loyalty and establishes long term connections.
• The second step is to visit the municipal offices of each community listed to get the accurate contact names and numbers of key officials. We also want emergency numbers for services. Each of these visits will include dropping off some of our menus and encouraging the city staffs to join us for lunch or breakfast.
• Next we will target each of the social groups such as Rotary, Sertoma, Optimists and various other business associations to encourage them to get us their event and charitable activities posted to advertise their community efforts. Again, it gives us an opportunity to invite groups of people to our restaurant.
• Concurrent with the steps above we will invite public cultural centers and their members and/or staffs to participate. That includes art centers, marine preserves, wildlife societies and similar facilities to keep their activities in public view by giving us releases on their activities.
• Finally, we will visit individual businesses to encourage them to list their names, addresses and services in our “Yellow Pages” of local business people.

After we have started to collect enough content for the site to have value to our guests, we will begin an advertising campaign to drive traffic to the site. This will include flyers and handouts for each guest and an email to our marketing list of over 1600 opt-in email customers.

This is our answer to the social marketing initiative. It gives us the ability to reach a greater percentage of our customers and prospective customers. We are trying to build long term personal relationships, not just a brand.

In the last couple of posts we have discussed the relatively new impetus for restaurants to involve themselves in sites like Twitter, MySpace, Facebook and several other networking type sites. The positives and negatives have been outlined.

For our new restaurant we decided to take an approach that:

• Involves a greater percentage of our customer base.
• Takes less time that to maintain, although a much greater initial time commitment.
• Allows community wide involvement.
• Brings together many different elements of the area.
• Eliminates competition for the same audience. (Chains cannot compete.)

We decided to develop a blog that will offer local (neighborhood), news, events, information, feedback and networking with all the various social groups. You can visit this blog as it is built. The name is Maggie’s City Center.

The real bonus is that most of our customers can participate, not just the ones who happen to subscribe to one of the social networking sites that have become prime media for the chains to distribute their coupons and build their brands.

After much of the content has been set up and we are ready to publicly  unveil it, a marketing plan fr the blog will be detailed to get the word out to the community. Visit the site and let us know your thoughts and comments.

In a previous post (April 3, 2009 - Restaurant Social Networking), I wrote about sites like Twitter, Facebook and Yelp. These social networking tools allow you to build personal relationships with people who share your interests and want to talk about the same subjects - hopefully, your restaurant.

The key point I was trying to develop was that a restaurant owner only has a relatively small amount of time to devote to social marketing (and/or networking). Running a restaurant consumes a huge part of your day, leaving only small inconsistent amounts of “free” time to work on marketing projects. Large restaurant chains embrace social networking sites as a method to build their brand. The chains have staff they can assign to this part of their marketing plan. Independent restaurants rarely can afford such a luxury.

In the case of our new restaurant, we want to use Internet social networking, but achieve these goals:

• Reach as many of our customers and potetial customers as possible.
• Use as little time as possible to commit to the long term project.
• Get the community involved including groups, charities and municipalities.
• Interact with all segments of our demographic.

The location of the restaurant is in a small suburban town adjacent to one of the largest commercial markets in Florida (Tampa Bay area). The location happens to be within several blocks of the intersection of several other communities, which all have their own identities. This crossroads location can be a networking nightmare or we can use it to our advantage.

We are going to research the development of a blog to tie the whole area together as one marketing community for us and our other business networking users. Sound complicated? Not really. A blog could;

• Keep track of events in all of the surrounding small communities.
• Allow our business customers to offer their services online.
• Become a focal point for charities to advertise their events and fund raising projects.
• Become a focal point for new residents to find information about the multi-community area.
• Allow our guests to have interactive comments about our food, service and dining experience.

Remember that all of the businesses, charitable groups, social clubs and similar organizations have employees, members, sponsors and participants that we want to reach. That allows us to have a broad communication approach to a large part of the potential customers and existing guests located in a wide radius of the restaurant.

The downside to our plan is the time commitment initially is significant, but in the long run, customers, business partners and community social groups will supply fresh content on a routine basis. It takes only minutes to update a blog, leaving more time to other operations of the restaurant.

More about our research, plan and progress coming in future posts.

Sometimes the best questions came from unexpected people. While walking through the new restaurant, I got into a conversation with a regular customer. He asked, “When do you get comfortable that you know your risk of opening a new restaurant was the right decision?”. Seems like a reasonable question, but it’s one I have never answered before or ever thought about.

Opening a new restaurant is never an easy task. The first ninety days has been up and down from many perspectives. Sales started off good, but we still have a lot of capacity to do more. Staff has improved greatly, but they can learn more and do better. Table turns are fair, but we can improve service to make them better at peak seating times. Management functions are OK, but need much more training and improvement in several areas. We are slightly profitable with along way to go.

Now if I look at one of the restaurants we have that are over five years old I can state that;

Sales started off good, but we still have a lot of capacity to do more. Staff has improved greatly, but they can learn more and do better. Table turns are fair, but we can improve service to make them better at peak seating times. Management functions are OK, but need much more training and improvement in several areas. We are slightly profitable with along way to go.

There is my answer. You are never comfortable!  The same exact statements for both an existing operation and new operation can be applied.

When you become “comfortable” about anything in this business is when you get stagnant and the excitement, challenge and opportunities slip away. If you look at any operation that stopped growing, closed up or is barely hanging on, I have to wonder if the owners got “comfortable”.

Now that I have had time to mull over the customer’s question, I will be able to replace my ambivalent answer with a firm one. I need to thank them for asking!

As the 90 day mark approaches from the day we opened the new restaurant, it is time to focus on more marketing tools to get communication deeper into our demographic. One of the options is Internet social marketing. Essentially that involves establishing a presence on sites like MySpace, Yelp, Twitter and Facebook.

The publicity in hospitality magazines offers glowing reports about how useful these sites are for retaining customers and networking to gain new ones. I decided to do a little research on these sites and their potential. My research was limited to:

• visiting the sites named above.
• looking at the options, uses and types of postings.
• talking to a few restaurant owners that I knew were using these sites.
• reading the latest information from industry publications.

On the positive side, restaurants can easily and quickly get involved. Most have a quick form to fill outanswering questions either about you or your business. This is your “profile” that is displayed and returned from a searchable database. People who share your similar interests, location and contacts become your personal network. You can chat with the members of your network and comment on any subject you want to search - including your restaurant. As other people join in, they become part of your network.

Almost all of the social networking sites work about the same way. Most have cute names and phrases that go along with things you do on the site. On Twitter, the height of cutesy, a post is called a “tweet”. Very clever. Each site can become addictive and amusing, but the issue is value as a marketing tool.

On the negative side of entering the Internet social networking arena, consider these issues:

• Relatively few of your customers and prospects are being reached. While these sites are very popular and gaining strength, the reality is that your demographic should be 18 to 32 to maximize the value.
• As you get more involved, time becomes an issue. Are these sites worth the amount of time it takes to maintain a presence and communicate with your network members? Can you spend your time in a more productive manner?
• Are you willing to respond to negative and positive reports on your restaurant regardless of their truthfulness, validity or importance?

After considering all the options, for us, the time versus reward isn’t there. I am a firm believer in email marketing and feel that many of the same things can be accomplished using email, surveys and direct contact with a lot less time committed. If your prospects cover a whole spectrum of age groups, income levels, locations and ethnicity’s, many are not part of the digital communication revolution. You have to continue to communicate your message to all customer groups.

The restaurant owners that I talked to who have gotten involved with social networking websites offered a mixed bag of comments. Some were sorry they started because the time expands as your contacts expand. Each takes personal response and attention. One owner told me he had a disgruntled employee write several bad reviews of his operation on Yelp. This caused the owner to refute the dismal reports and forced daily monitoring. You can write whatever you want on the Internet. That is the price of digital freedom!

The bottom line is that we will monitor the value equation of Internet social marketing and ignore the rantings of restaurant marketing “consultants” who say this is a great tool. We will plan our next email and media campaign with the time we would have been “tweeting” on Twitter.

For more restaurant marketing ideas, visit On a Wait, a marketing blog.