5 ways to run your restaurant in an uncertain political time
In light of the recent presidential election, there has been a significant amount of uncertainty in the restaurant industry. With questions surrounding labor costs and market patterns many restaurateurs may wonder how to deal with this tumultuous period and continue to move forward? The answer lies in making sure your business and approach are both relevant and remarkable.
1. Focus on motivating employees
If you focus on empowering and motivating your current employees, it will enable you to get the most out of your labor. Inevitably this will translate to a better customer experience for your guests. If you don’t know how your revenue is going to be impacted, you should focus on making your current income as profitable as possible. Efficiency is key. The best sports teams are those that only focus on their own game, rather than on who they’re playing. If you create a strong culture and team, it won’t matter who or what you’re up against. You’ll be so good that you’ll beat anyone you play.
2. Make sound financial decisions
It’s all too easy to tighten your belt in expectation of a downturn or even uncertainty. However, it’s more important to go back to basics and simply make sure you are making sound financial decisions. Make investments that reap returns regardless of the state of the economy. Avoid being risk oriented or too frivolous – either extreme can hurt your business. Instead, be disciplined with how you go about evaluating the risks and once you do, focus on the returns.
3. Pay attention to history
In a strong economy, people tend to dine out frequently. In a poor economy, people still eat out – but for different reasons. Restaurants become a low cost means of entertainment and escape. If people are still spending money – make sure your business is one of the places they want to visit. During the recession in the 1990s, restaurants that provided both food and entertainment flourished, including Planet Hollywood, Hard Rock Café, and the Rainforest Café. During the last recession, fast casual concepts that delivered good quality meals at a low ticket price came out on top. These companies saw an opportunity and they took advantage of it. They then had access to great real estate that was previously unavailable – because they were the only ones developing. And they succeeded.
4. Don't believe the hype
If your crystal ball is working better than mine, then maybe you know exactly what the Trump administration is going to do and how it is going to affect the economy in general and the restaurant industry in particular. If immigration is truly curtailed in the long run, then the already tight labor market will likely get tighter. However, is that good or bad for the American economy? I wish we all could believe the vocal pundits and know definitively which direction things will go. In the meantime, I’m certainly not going to believe everything I hear and/or read about. As stated above, I’m going to focus on the basics and make sure all the council we give to our restaurant clients reinforces sound business practices and takes advantage of the facts we know rather than the hype we hear.
5. Have a solid plan for peaks and valleys.
This reiterates each of the four points above and simply takes into account what you should already be doing in the long run. Despite what the economy does, be prepared for both the peaks and valleys. By taking the steps now to keep everything in balance, you won't be as impacted by when they are not. The goal is to stay steady even during uncertain times.
There is always an opportunity for growth and success. The key is to look for it and do it better than anyone else. In essence – remain both relevant and remarkable. By focusing on these few key areas, you can make it through uncertain times with ease.
Cover photo: iStock
Topics: Operations Management
Steve Starr / With decades of experience in the industry, Steve Starr has become a nationally-recognized leader in restaurant and retail design. While his insight and expertise spans the hospitality industry, his focus is on branding, consumer behavior and the development process. Steve leads a creative, multi-disciplinary team of architects, interior designers, graphics designers and branding professionals at Starr Design in Charlotte, NC – where they concentrate on connecting people with brands through creative environments and responsible processes.