Starting and running a restaurant is both exciting and fulfilling; but it’s also risky. Getting brilliant advice along the way is key to ensuring you succeed. To help you with your journey we’ve asked our in-house experts, people who have stood where you now stand, to pass on their professional wisdom so you get it right and nail those business goals. In this first part Seasoned Client Growth Partner Sam Phillippe looks at planning your hospitality business.
It’s no secret that writing and following a bullet-proof business plan plays a vital part in building a solid business. But it’s surprising how many people I’ve seen skip this stage and dive in head first without really thinking about the direction they want to take and how they’re going to get there. People have a great business idea and are passionate about the food. They’re keen to get stuck in and make things happen. I get that. I’ve been there too!
If this sounds familiar, the good news is that it’s not too late. Follow these tips and you’ll be right on track.
Writing a business plan can certainly seem intimating. But it doesn’t have to be. And it doesn’t have to be lengthy either so don’t put it off thinking you can’t spare the time. There are loads of resources out there to help. But don’t get blind-sided by all the practical things (premises, regulations, tech etc). Remember to focus on the core pillars that should steer your direction:
> why your business exists – once this is properly defined you can make all your decisions with this crystal clear vision in mind. It also gives your staff an identity to bond with and be proud of; a purpose, if you will.
> how it will satisfy this purpose
> what exactly needs to be done to establish and remain in growth and in profit
I believe that having a solid plan takes you 90% of the way to establishing a successful restaurant business. The remaining 10% is made easier as most of the strategy can be shared with the team; training can be provided, and everything can be set up for success in a proactive manner.
You don’t need to have a fully complete business plan to launch your restaurant either. In my opinion, a restaurant owner should have 80% of their business plan written before trading begins but the remaining 20% is trial and error, based on test-trading.
As you learn about your business after you begin trading – perhaps by running pop-ups or setting up in premises, you’ll more than likely need to adapt your original plan. You’ll discover more and more about what your customers actually want and need so expect to make relevant changes to meet these requirements.
And don’t overlook that last 20%! It’s often the final piece that helps everything else slot into place and makes your business flourish. Once a restaurant opens it’s easy to get caught up in the day-to-day and leave that last 20% of the plan unwritten.
Once you’ve nailed that final 20% don’t even think about just pushing it to the back of your mind; ticking it off as a job done. You really can’t afford to take your eye off your business plan. Think of it as your North Star. Use it to help you set direction. Consider it a framework for decision making and considering opportunities. Ask yourself:
> Can you answer every question with certainty?
> Do you properly understand your customers?
Give yourself 3-6 months to really fully understand these points. Test trading is vital if you are to fully understand your business so get as much feedback from customers as possible and work on building a really great relationship with them and, of course, provide world-class customer experience.
The most important thing when starting out is knowing and understanding your customers. They determine everything that you will do. So in order to understand:
> what you will sell
> what prices you will set
> your opening hours
> your location
> your marketing strategy
> who to employ
You need to establish:
> what exactly you can sell to appeal to your customers
> how much your customers are expecting to spend
> what does your price say about the quality of your brand/product?
> are your customers time-poor? Cash-rich?
> how do your customers choose to pay?
> how do they like to be communicated with?
> what are their lifestyles and how does your business fit with this?
Your business plan sets the core foundation of everything that you do regarding your operations, and customer experience is one of the main focuses for this. Gathering data on your customers will be key to gaining a crystal clear picture of who they are, specifically: their behaviour, average spends, the times they visit your restaurant, and the purchasing needs for different types of customer, to name but a few. The better you understand this, the more you can make sure your customer experience is on-point, and begin to build loyalty.
I’ll be covering this in more detail later on in this series so make sure you’re the first to know when our article is live, to help you stay ahead. [link to newsletter sign up]
While knowing your customers is vital for the success of your restaurant, there is another group of people that needs your focus and attention even more: your team. They are quite literally your everything. And you need to make them your priority, ahead of everything else in your business. Look after them because they will look after your business, your suppliers, your customers, and your bank manager.
This is another topic that I’ll expand on in this series, so keep an eye out for that too. In the meantime, take this opportunity to start (or re-address) your business plan and ensure that you’re setting yourself up for success.