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failed restaurants

9 Infamous Things Failed Restaurants Have In Common (That You Should Avoid!)

No F&B business wants to fail something they’ve invested half of their life savings and their soul. While failure is a great teacher and springboard to success, learning from others’ mistakes is a powerful business-saver that can give a budding restaurant or food entrepreneur an edge. 

We’ve compiled a list of characteristics we’ve noticed most failed restaurants and F&B ventures possessed. We hope you will never have to place a check mark next to any item on this list.

Lack of Mentorship (Leading to Lack of Experience)

chefs cooking food in the kitchen

Inexperience is a great thing – it’s an open road towards an individual’s success. However, you learned to stand up and walk with somebody holding your shoulders. 

One defining characteristic an inexperienced owner possesses is doing all the tasks everything from cleaning the restaurant before the opening to the accounting during closing. Mentors impart their experience by teaching new owners about delegating everyday tasks to trustworthy and skillful individuals in the fold.

Poor Accounting Systems

Monetary accounting is a valuable aspect of any business venture. If owners disregard cashflow overviews and projections, they fail to balance operational and maintenance costs, selling prices, and the net profit the business makes.

With today’s technology, it’s easy to learn about basic restaurant or F&B accounting. In fact, apps such as NinjaOS give you excellent accounting tools with convenient point-of-sale systems that integrate with any of your device – which means you can do account at any time and any place!

Troubling Management 

Management isn’t just about hiring the right people. It’s about ensuring the entire restaurant runs a flawless and solid operation that meets its daily and long-term goals. While you may have found the right employees for the required tasks, utilizing their strengths and improving their weaknesses is a core duty of an excellent manager.

Many failed restaurants failed to take note of employee knowledge, endurance, and usefulness in different types of responsibilities that would have boosted their productivity and profits.

Subpar Food Preparation and Execution

beautiful food plating

Meal Food Restaurant Plate Dish Dining Dinner

The food is the cornerstone of every F&B business. While the restaurant ambiance is another factor, the food’s appearance, taste, and overall impression significantly contributes to its success. We know it seems like a farfetched reason, but numerous restaurants and food businesses that failed in the last decade had food that had inconsistent taste quality and questionable preparation practices.

Your dishes are the lifeblood of all F&B business efforts. It’s important to make this consistent before anything else such as starting an online marketing campaign.

Nothing Unique In Offerings or Brand Identity

Many failed restaurant owners have questions why they failed. In our experience, most owners said they handled restaurant routines seamlessly and offered food with excellent aesthetics, taste, and top-notch ambiance and customer service. However, they missed one important thing: their unique selling proposition.

If you’re a cheese pizza business only offering lower prices than the competing cheese pizza parlor just across the street, you are sharing from a single pool of customers. However, if you had a unique selling proposition such as cheese pizza and wine product packages, you will surely have your own dedicated set of customers. 

Inconvenient Location

Just like the example we used above, opening a branch right next to a shop with a similar selling proposition has you share the same type of customers. However, even if you have a unique selling proposition, it can only go so far if it’s not gaining attention from your target audience. Poor, low-traffic locations have spelled doom for many budding and even long-running restaurants and F&Bs.

Opening in business districts and densely-populated is often more expensive. However, they will surely find your unique selling proposition mouthwatering and likely return your ROI fast.

Overspending or Overreaching

woman-looking-at-acquaintance-in-a-coffee-shop

Earlier, we mentioned about solidifying your food recipe, taste, and daily seamless routine before even thinking about anything else. Many failed F&Bs often took more than they can eat – they spent so much on marketing without any prior insight about their target audience’s food preferences.

While poor accounting contributes greatly to overspending, bad spending decisions are just one part of the equation. The lack of insight about preferences will affect the audience’s reception of the product, which in turn leads to plenty of losses for restaurant and F&B business owners.

No Digital Presence

vector-ordering-food-online

A simple social media profile is sometimes enough for many F&B businesses. This may sound impossible, but restaurants having just one single social media profile and lacking a website often only had limited numbers of customers. 

True enough, word-of-mouth is a great marketing tool, but it can only do so much especially if your food is popular to millennials and tech-savvy individuals. Having a digital presence in the form of a website and multiple social networks will always give you an edge – and you won’t have to spend so much for it! 

Highly Dependent on Online Food Delivery Platforms

Sure enough, these platforms are booming almost as much as smartphones are still increasing its sales. Unfortunately, their all-encompassing terms of use spelled doom for many failed restaurants. 

Online food delivery platforms aren’t as great as they claim to be. One, they take 30-40% of your overall profits for every food you deliver. That’s a huge cut from your profits.

Second, they never provide you any information about your customer’s preferences, spending habits, and hotspot locations. These data can help you create new innovative dishes that help establish your brand as a whole.

Lastly, when the customer becomes dissatisfied with the food quality because the platform delivery personnel failed to package and deliver it effectively, the restaurant will have to reimburse the customer. And to save face, they even have to re-do and re-deliver the dish once again as part of the online delivery platform’s quality guarantee.

Watch Out For These Pitfalls and See Success Fast!

The best way to succeed is to fail. But by taking note of these nine infamous fail-inducers, you can safely avoid sabotaging your efforts towards creating an established F&B business brand.

Always have full control of your deliveries, logistics, and customer data. If you’re looking for a solution, we would like to present you something that may just revolutionise and disrupt the dominating online delivery service platforms today. Interested? Drop us a line at sales@ninjaos.com

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