5 Common Mistakes to Avoid When Opening a Restaurant

You’ve invested in a restaurant, hired a great staff and can’t wait for the grand opening. After all, you can’t start making money until the customers start pouring through the door. But before you get too hasty in opening your doors, make sure you’ve done your due diligence by going through your essential “To-Do” checklist. And avoid these common mistakes that often plague anxious restaurant owners.

Starting With Too Little Cash
Many restaurant owners underestimate the amount of cash they’ll need to run their units. They may have enough for their down payments, labor, first few advertisements and overhead expenses (utilities and electricity) but fail to realize unexpected costs like repairs and spoiled food. When starting out in a restaurant business, you should have enough capital to cover at least six to night months of expenditures, according to CNBC. Realize it takes time to build up a clientele.

No Pre-Opening Publicity
Don’t wait until your restaurant opens to start generating interest. Apprise the public of your restaurant several weeks or months in advance. Contact your local newspaper, television and radio stations. The reporters will probably welcome your story because it benefits the community. While you’re at it, call publishers of local restaurant magazines to build awareness. All of these promotional efforts are free and highly effective in getting customers to your door.

Scrimping on Portions and Equipment
While great food and a relaxing ambience are essential in getting repeat business, you can easily lose customers by scrimping on food portions, décor or equipment when starting out. Avoid this type of conservatism like the plague. Instead, invest heavily in delighting your restaurant patrons because they can generate even more business via word-of-mouth, according to Inc.

Too Many Menu Selections
Fast food giant McDonald’s hurt its business for years by overcomplicating its menu, according to Huffington Post. And while it’s easy to think that you can generate more profits by appealing to more customers, it’s best to keep your menu simple. It’s much easier to excel at preparing six or eight menu entrees than a dozen or more. And you won’t sacrifice your most loyal customers with mediocre-tasting food.

Lack of Organization
Some people don’t realize the number of tasks involved in running a restaurant. So it pays to get your systems in place before you open for business. Establish policies for opening and closing your restaurant. Most POS systems track sales and inventory usage so you know when to order certain items. Get your people trained on food preparation, safety and sanitation. Have a backup plan in case of equipment failure. For example, you may need to use petty cash to purchase 2-liter bottles of soft drinks at the grocery store if your drink machine breaks down.