Jane Lerapo

Reasons why restaurants go under more than any other kind of business A study by the National Restaurant Association and Cornell University shows that 60% of restaurants go under within the first three years of being in operation. Unfortunately, this figure is expected to rise in the coming years. The restaurant trade is pushy. Every entrepreneur in this field knows that and every business person aspiring to enter this field ignores this fact. Ignoring this fact and not taking any action to try and do an in-depth analysis on what should be done to curb this crisis is just a tip of the iceberg. The following are other additional reasons why restaurant failure rate is rising by the day: 1. Offering large menus It is not possible to please everyone. In the same scope, customers need to know your area of specialty. Most restaurants want to be everything to everyone. It’s not easy to specialize. Having a particular niche and nailing it makes it simpler for your customers to refer the restaurant to others. However, this is not the case. 2. Lack of management skills Most owners or people who venture in this field have the talent to cook good food. What they do not know is that it is not only about food. For any business to prosper, marketing should be top notch. Managing is also another accompaniment. Without this, it is impossible to track how many people visit the restaurant in a day, what is the most preferred kind of food, which are the pick seasons among many essential details. 3. Poor pricing schemes The prices on the menus are mostly determined through competition. They compare prices set by the others without putting into account the costs they have accrued to avail that food. The way a competitor gets raw materials for operations or pays their workers is not the same as their counterparts and therefore setting the same prices only make them sink deeper. 4. Poor customer appreciation People come to the restaurant for more than eating the food. They come for a new experience each time they step into the restaurant. You find that the same way the customer was served last time, is the same way they will be served the next, next and next time that they come. This creates monotony which is boring! 5. Focusing on common selling points Most restaurants only focus on the food that they cook and the service that they offer. Customers want to identify something unique in each restaurant. There is no unique selling notch.