Even, if you are not a restaurant owner, this article will still provide some helpful ideas for evolving your business to succeed in 2020 and beyond. My many years of owning and operating businesses in the food industry are where I will be drawing my thoughts from, but regardless of industry, owning a business in 2020 means that we are all facing some very universal challenges.
Let’s start with the good news versus the bad news.
The good news is that as a business owner, you’ve made it this far. You’ve made changes and held down the fort to maintain some level of revenue or funding to make do while this crazy and chaotic time passes. The bad news is that things are still changing, and we don’t know how far down the rabbit hole the Shelter In Place order will take us.
Perhaps not “new news” to you, but let it serve as a bit of confirmation that you are doing things right and are facing the same problems and concerns together with many others.
In this article, I’m going to give you some acknowledgement where it’s due, a few ideas to think about, and a new method of opportunism to follow.
Several categories, but the same boat.
As a business owner who is managing ways to keep your business open, you may have found yourself in one of these categories:
- – You’ve had to close your doors completely, but are now reopening with almost daily and unforeseeable, sometimes expensive, changes to the way that things must operate.
- – You’ve been fortunate enough to put new services in place that have kept your business operational, such as take-out orders, delivery services, and outdoor dining.
- – You’ve thrived as a result of your business having already been established for online or phone orders and are seeing a financial boom. However, you may have uncertainty about how long this type of revenue will last and if it’s sustainable.
Regardless of where you fit within those categories, we’re all in the same boat together. Change, uncertainty, stress, tighter budgets, longer work-days… It’s like starting a business from scratch all over again. To say that this year has been “frustrating” is quite an understatement. Even those who are in the rare category of thriving right now don’t know what waits around the bend as the road forward is paved brick-by-brick right underneath each step we take. So let me offer you a truth about tough times that isn’t exactly easy to remember when you’re in the hot seat. As a former business owner myself, I held onto a quote by the great Thomas Edison which was so simple but so profoundly undeniable,
“Discontent is the first necessity of progress. Show me a thoroughly satisfied man — and I will show you a failure.”
When things aren’t working, or it becomes evident that change is needed to keep from failure, we are forced to find or create new opportunities in order to adapt to the situation. But the quote goes even deeper. Not only is change necessary in the moment, but to be successful at every turn “change” needs to be part of the ongoing plan itself. This is important not only for being able to navigate through uncertain times, but to be ready for when more natural changes occur in areas such as market demand, new trends, and new competition.
In a related quote, “I have not failed. I’ve just found 10,000 ways that won’t work.”, Mr. Edison clearly communicates that not only should you not be afraid of trial and error, but that you should expect it as part of your plan for success and embrace it knowing that you are closer to the right decision each time. Frustration is the fuel for experimentation, knowledge and progress, which inevitably will lead to successes along the way.
With a full tank, a new journey.
So, if frustration fuels change, we’ve all got a full tank right now. So where do we go from here? The road we are familiar with is closed for reconstruction so the only option is taking the road not yet traveled. With no map drawn yet, it is up to you to explore, discover and chart the dead ends and clear paths.
In a time when margins are even leaner and revenues are deflated, the last thing anyone would consider is a discount on their pricing… And that’s exactly why you should consider it. However, we’re not talking about simply dropping your prices. A simple price reduction doesn’t build value to the end customer, nor does it necessarily create a desire to buy from your restaurant over a competitor. So rather than lowering price, think in terms of increasing value:
- – Offer a discount for purchasing alcohol with the takeout order. One of the most unique things about the Shelter In Place ordinance is that alcoholic beverages can now be ordered for takeout and delivery. Take advantage of this, especially if Alcohol sales historically made up a good chunk of your revenue. Perhaps even put your signature cocktails in to-go bottles with your business’ logo on it for a branded keepsake.
- – Offer discounts for buying multiple meals. Meal prep services have grown in popularity over recent years and restaurants that have had this as an established service already are doing very well right now. Customers save on trips, gas and time.
- – Conduct a food drive for a limited time, and offer a discount for customers who bring in canned or packaged donations at pick-up. Everyone right now wants to do good for their community, and joining them in the effort not only makes your business look good, but gives people more of a reason to buy from your restaurant.
- – Promote cash only purchases for a limited time and pass the savings of eliminated processing fees onto your customers.
- – Highlight and sell some of your vendors offerings, for example the bakery you receive bread from, do they make pies, cakes or cookies? Sell these at a small markup. Have a florist? Add flowers to the order, create a date night package dinner, market the meals as bulk, planned leftovers. Be creative, have some fun with it.
Follow this type of thinking of adding value to your customer’s experience when coming up with your own new ideas and trial runs. It may be awhile before you will get to see full capacity seating in your restaurant so don’t focus on trying to fix that issue. Focus on increasing pick-up with value add-ons and something to drive them back through your door. Make use of simple online marketing platforms like VistaPrint to create custom fliers to send to your neighborhood and/or as attachments to the receipt for a value-add on their next order. This will help balance the loss of dine-in revenues.
Success lies within opportunity.
In order to take advantage of every opportunity right now, you have to be opportunistic; you must be in the mode to recognize an opportunity when it presents itself and give it a go. More often opportunities are not created, but discovered. It is as simple as being open, not judging but investigating.
To reference another mind-set influence of mine, John R Boyd, the author of the paper ‘Destruction and Creation’, created a theory which can be applied in a fast-changing, volatile environment such as this year’s circumstances. OODA is an acronym for Mr. Boyd’s suggested loop of thought-to-action, which stands for the following:
- Observe – This is data collection, observable, measurable, or just a trend that looks promising and fits your abilities.
- Orient – Analyze the available data and synthesize into a working theory of options. For some of you, do not linger here.
- Decide – What is the best option currently? Make that choice and take it, cutting away the rest.
- Act – Execute the plan. Immediately. Give yourself permission for it not to be perfect, action is required in the moment, here lies the power, acting on the decision.
And finally, REPEAT. Evaluate the results of your action. Reassessing and taking the new situation through this continuous loop will help you choose the best path on a road that constantly presents new detours and forks, seemingly at every turn. Even when you find yourself on the wrong path, implementing this method integrates reassessment to help you determine that you need to try a different direction.
Brian Bacher is a Business Advisor with Sunbelt Business Brokers. He can be reached at (408) 436-1900, or at [email protected]. Or connect with Brian on LinkedIn.