Category Archives: Openings

Top 10 Reasons for Bar / Restaurant Failure and 5 Solutions

UPDATED :: In over 10 years as a key player in more than 40 successful openings and long term success of bars, restaurants and nightclubs, I have seen a lot of competitors fail.  As much as I’d like to claim we “killed the competition,” often they actually kill themselves, sometimes before they even open.

Following are the Top 10 key reasons bars, restaurants and nightclubs fail. We are currently offering a free consultation to help in any areas needed!

TOP 10 REASONS FOR FAILURE

(1) The restaurateur/owner does not understand what business they are actually in. Their fantasy does not match the reality of running a successful operation. No one thinks they can hang a sign and have a dental practice with no training because they brush their teeth every day, but many people think they can launch and run a restaurant or bar because they like to go out for dinner and drinks, or maybe they worked in a bar for a while.  There’s much more needed to succeed.

(2) Typically when developing the restaurant too much is spent on construction, equipment and decor and not enough on staffing, training and marketing. Many new owners love to spend on “things” and are reluctant to spend on people which are the #1 key to a good guest experience.

(3) Careful research is not done prior to opening on politics in the community, and vital relationships are not forged with people in local power positions (over your liquor license and inspections for example!) Particularly, beverage driven venues can set themselves up for constant trouble from authorities once they are open. “Connected” experts are needed on the team, as no single person or owner knows enough about the various players and issues. This is survival stuff that all too few pay enough attention to!

(4) Concept Development is not led by someone with a successful track record of launching multiple bars and restaurants, so the right concept is not chosen to fit the demands of the market and the team fails to maximize the best opportunities to make money at the particular site and in the various desired target markets.

(5) Four walls marketing (inside the venue) and generating repeat business are given minimal attention when they should be the most important two parts of the marketing mix after opening.

(6) Lights, music, atmosphere (temperature/comfort) are not consistent and appealing. These are simple basics yet hard to maintain. Circling back to point (1), many who open restaurants don’t realize it’s the details that make or break you.

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Today was the opening of Chicago’s first Olive Garden Ever so I stopped by

On Addison just east of the Kennedy the first Olive Garden ever in the City Limits of Chicago is having a very successful opening day.  I stopped by to chat with the PR pro working the opening, Jenni Izzo of Costa Communications.  The place was packed and the building and decor would surprise anyone who has a stereotype of what Olive Garden looks like.  It was ground up construction with a nice new upscale look.

Of course, Olive Garden is not trying to be trendy but do I believe this location will be very successful, likely leading to more locations in Chicago and other urban areas.

Here’s more from Eater Chicago on the opening, and the garlicky political implications.

Here’s a Restaurant Reality Show I can love

“Restaurant Startup” on CNBC – very cool story and interview with the stars of the show – Joe and Tim – who put their own money behind start-ups who can convince them to invest.

Now that’s reality.

So is this:

“So, listen, this is what you need to know about the restaurant business: Thirty percent of your cost is your food. Thirty percent is your labor. Twenty percent is miscellaneous shit like rent, bug spray, and insurance. Twenty percent needs to be left for you. Your rent should be what you gross on your slowest day of the week, and if you’re not making double what you made in the job that you gave up to open your restaurant, then you just bought yourself a job, and you’re not really in the restaurant business,” Joe Bastianich says. “That’s what everyone needs to know.”

Yup – Love it.

restaurant startup

Thanks to Christine  Champagne and Fast Company that published the piece.