While working with a coaching client on site in Orlando, Florida I observed packed parking lots, traffic jams around Millenia Mall and filled restaurants. My comment was ” they have not heard there is a world wide recession!”
We discussed why the area seemed particularly crowded. The number one reason seemed to be that the new Harry Potter attraction had just opened at Universal Studios and it seemed be a huge draw. So now I knew that my observation of the market could be distorted by a special event.
Later that day, I was invited to join a group at a very popular “upscale restaurant”. This place is very near Tiger Wood’s home. My definition of an upscale restaurant is one where the dinner check for two including tip is in the $200 plus range.
After a marvelous dinner, I met the owner. I had a comment and a question. My comment was about the wonderful dining experienced I just finished. I assured him I really enjoyed it as did the business people dining with me. My second remark was that his business is actually an economic indicator…a barometer of how well people are doing. Given that I asked how his business was doing on a comparable basis with last year.
Comparable analysis in business is where you compare the same period this year with the same period last year. In this example I was asking about business this year to date vs last year. He told me his business was down 30% and that the “upscale restaurant market” was down 40%. He felt good as he was fairing better than the competition. I was not feeling that good about it considering the economic slide began accelerating in 2008. This means the numbers in 2009 used as a comparison have already been on a decline so the decline in 2010 is particularly disturbing.
I mentioned to my client and his key person in Orlando that I would send them a list of what I would recommend this restaurant business owner do to strengthen the business. I decided these 7 Steps could help many other business owners so I am using my blog for the action plan and I will email my friends to let them know about these ideas for their Orlando restaurant owner friend.
Top 7 Steps For Strengthen Sales and Profit In The Restaurant Industry….Actually Applies To Most Businesses:
1. Know your customer! People coming thought the door and buying should be acknowledged with an email or card and possibly more. How do you do this? You need to have their contact information and specifically an email address and now ideally their cell phone number.
Here is an idea on how you do that: Buy them a drink or a dessert in exchange for their information. Here is the key: when you identify a particularly important person, the owner comes to the table, welcomes them and offers to buy their dinner in exchange for the cell phone number so they can be alerted for a very special event. Now before you say this ticket could be $200 or more I ask you how worth it is to have the cell phone number for key text messages with VIP’s and I mean people whose net worth is in 8 figures. This is huge
2. Have a plan. Your financial plan should be an annual target that can then be detailed to a weekly plan.
3. Know your numbers. Traffic and sales by time of day. Track your trends. Use this information to market to your list. Invite them to slower times using incentives.
4. Use all proven marketing tools to help grow your business. These include direct mail to targeted zip codes and ads with a “hook” in publications your target customer reads and other venues like radio, participation at key charitable events, local/regional festivals that are for your target audience, on line promotions and more.
5. Have your on line credibility in place meaning a website and social media presence
6. Use a referral marketing system. Reward people for inviting their friends and colleagues.
7. Monitor the variances from plan in all areas of your business. Nothing is excluded: payroll, food costs, utilities….the gold is in the detailed analysis of the variances.
Now You Know…Success Is In The Details. Failure is almost always a result of not consistently following the steps that have been proven to lead to success.
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About: Steve Pohlit CPA,MBA has been the CFO and COO of major domestic and international companies. Steve has extensive business ownership experience having purchased and started off line and on line businesses. Steve offers his business building experience to companies and entrepreneurs with business coaching and business consulting. His focus is on building business profits and net asset value at above average rates. All articles published by Steve unless specifically restricted may be freely published with this resource information.