Most Restaurants Fail

It is a commonly held belief that as many as 90% of restaurants fail in the first year. Skeptics of this tend to believe that this is simply not true and is closer to 60% in the first year and 80% by year number three. You say potatoe, I say potato, the numbers can be debated. The undeniable fact is that the majority of new restaurants fail. The exact number is just splitting hairs.

Here are a few reasons new restaurants fail.

1. Not enough cash;

Make sure that you have reserve money available. It’s better to setup lines of credit, credit cards and loan provisions BEFORE you actually need it. If you run tight on cash, your staff won't take "I owe you" for a paycheck, neither will your supplier take "I’m out of cash" in trade for supplies. Just like you wouldn’t agree to "Can I pay you Tuesday for a hamburger today?"

2. Bad Hiring;

Ever meet someone who absolutely hates their job? Do you really want to be around them? Your customers sure won't. Hiring staff in a hurry usually leads to hiring bad staff. Disgruntled, unmotivated staff will not go the extra mile that is needed for your business to survive. Be a good boss, treat your staff right, regardless if the business is making money or not.

3. Out of control expenses;

Having your till ring is a great sound. But always remember: "The amount of money coming in is harder to change than the money that goes out." If a product doesn't sell and keeps spoiling, get rid of it. Make sure you have cash controls with all staff that are around cash and be wary of insider theft. Insider theft accounts for eight times as much loss as that stolen by your customers and strangers.



Most restaurants fail, but keeping your cash flowing, your staff happy and your expenses in line will hopefully help you be one of the success stories. The other biggest reason most restaurants fail is that the owner isn’t aware of a few newer ways to attract and retain more customers. Without a steady flow of new, and return patrons, most restaurants fail!

It is sad that many rookie restaurant operators don't know just a few little things that could mean the difference between profits, and a "For Lease" sign in the window!

If you are thinking about opening your own restaurant, or struggling to make your current restaurant profitable, I suggest you read the FREE report entitled "The Restaurant Industry's Dirty Little Secrets. To get your copy of this restauant insider information (there are some people who desperately don't want you to learn this!), click here to get your FREE report!

If you would like to read more about the event that made me mad enough to sit down and write this ebook, click here

Today's Independent Restaurant Business Tip

for . Many owners obsess with coming up with the perfect restaurant name. Unless you are politically incorrect or crude your name is not going to make or break your restaurant. However, there have been many operations open, order glasses, uniforms, menus and promotional items only to receive a nasty "cease and desist" order from a lawyer. Make sure you research your restaurant name. It is surprising how many restaurants are forced into the costly procedure of changing their name in the first few months. This costly mistake can cripple your operation. Get your lawyer to check and register your name!

Testimonial

Hi Patricia
I had to email you and tell you that your insight saved me from a $40,000 mistake.
Thanks,
Sheryl Gundham