What We Have Learned From Failing Restaurants

Notice any of your neighborhood restaurants going out of business in this economy? If so, you are not alone! It is happening everywhere, to all kinds of restaurants. But the good news is that there is actually a lesson to be learned from these failing restaurants.

Keep It Simple

You have probably heard the saying “keep it simple” before, right? Unfortunately, those failing businesses were doing anything but. Research that was conducted to see whether there was a pattern regarding which restaurants survived the economic storm, and which folded under pressure, revealed a lot.

The restaurants that went out of business had a common issue, and it largely centered around their menu. They were offering their customers way too many options. Sounds strange, right? But when you think about it closely, it is easy to see that it makes perfect sense.

Having too many menu options can result in a host of problems that a business fails to see coming at them. Without a doubt, they thought their large menu was what kept their few customers coming back. But it actually had an opposite impact on their business.

The Larger Picture

A restaurant that has too many menu items listed is going to run into problems. A lot of them, including many that you would probably never even realize, even if you were the restaurant owner or manager.

Some of the problems caused throughout the whole restaurant as a result of a menu that is too large include:

● Slower service. Get a frequent customer and hand them a large menu and it may be okay. But the average person is going to take a while to mull over the menu, making the table-turnover rate slower. A slower table-turnover rate means less money at the end of the day.

● Slower cooking. That slower service spills over into the kitchen, as the cooks need to keep shifting gears as they make a wide variety of dishes. When this happens, the dishes are likely to take longer to prepare, which doesn’t exactly keep customers happy.

● More mistakes. When you have so many things on the menu, the cooks have to strive to get a lot of different dishes right. There are bound to be more complaints and more food sent back, costing the restaurant even more money.

● Larger inventory. Can you imagine the inventory that a restaurant has to keep on hand, in order to provide all those dishes, any time someone orders? And if someone doesn’t order all the stuff, it translates to more money lost, as the food goes bad.

● More mistakes. Waiters are generally supposed to be pretty knowledgeable about the menu where they work. But having a lot of options on the menu means they are likely to make more mistakes, leading to more unhappy customers.

● Lower quality. If a restaurant concentrates on a small list of dishes, they are likely to get better-quality ingredients at a better rate. You lose that buying power when you are purchasing smaller amounts of many different ingredients.

Pair Down, Focus

Now you have a clear idea of just how much of a problem a large menu and lots of options can be for a restaurant. And the same principle can be carried over to your business, regardless of what you are serving or selling.

Rather than try to be everything to everyone, determine what you do best, and then narrow in on that area. When you tighten up your list of options, you will be helping to avoid the sort of problems that arise in the larger picture when you offer too many things. It may be too late for thousands of restaurants to learn from this advice, but, luckily, you can still benefit from it!


Leave a Reply

Your email address will not be published. Required fields are marked *

More of mike…

Have Mike Speak at your event

Read All of Mike’s amazing Books

Listen to Mike’s Podcast Right now

Join Profit First Professionals

…& Mike’s Books

Profit First


The Pumpkin Plan

The Toilet Paper Entrepreneur