Restaurants sales for most of 2017 have been soft. We are seeing reports for both of the first two quarters trending below expectations. The results are the same for both franchise and independents operators. As a restaurant broker performing valuations on a daily basis we always ask potential sellers the same question we are being asked by the bank and the buyers. Why are your sales declining? The most common answer we receive is, “I don't know."
If you have been reading or even just glancing at the headlines in most trade publications you should know this: traffic is down and there are more options than ever before for consumers when it comes down to prepared food. Are you measuring the decline or working to curb the trend?
Owners will often tell us their plan to grow sales is a “wait and see” strategy. For these sellers, they truly believe, “it will come back on its own; this is a good location." Other reply that they truly don’t have a plan. As a restaurant broker focusing on business valuation neither of these makes me feel good. If you tell this to a banker, don't count on lending any time soon. They will likely shy away from your deal with either answer.
Now that the cat is out of the bag let's try to look at what you can do to curb this trend. Here are three ways you can take control of your business today and improve your sales results.
Review and Refresh your Marketing and Advertising Strategies. Marketing and advertising have changed tremendously over the last couple of years. If you don’t clearly understand how to interact on social media to drive bottom line results, I suggest you hire someone that does ASAP.
Putting your events and daily specials on social media every day is not having a successful social media presence. You need to measure results and look at each offer. Social media is not the magic bullet to turn your sales around. It is, however, one of the ‘must-have’ tools in your strategy.
Community Involvement. Old fashioned community involvement seems to have fallen off the radar but the actual bottom line results are still strong from this tried and true method. Churches, little league baseball, youth football, soccer and civic organizations in your area are great potential loyal patrons for your establishment. Restaurant owners need to go and meet with the leaders of these groups. Then figure out the best way to get involved and ask how you can personally invite their members or participants to your restaurant.
Get Outside Your Walls. In this day and age of technology it is very easy and comfortable to stay behind our screens and interact with others though digital means. You however, chose to be in the restaurant industry which requires human interaction every day with team members and customers. Most of you enjoy the interactions and this why you are a restaurant owner or manager, otherwise you would have become an accountant! In order to gain sales even in slower sales cycle it is imperative for you to reach OUTSIDE of your four walls on a daily basis. If you are not out there in your local market meeting new people, thanking and inviting customers, someone else is doing it for their establishment. You should be outside the store with a strategy every single week to develop new business. Is there a new gym opening? Partner on a coupon for a healthy “side” for free with purchase of an entrée. Fun K run this weekend? Buy yourself a tent and invite the runners to celebrate their success with a sweet indulgence – free dessert with purchase of a meal. There are many ways to get outside the store and develop business.
While we have restaurant sellers trending right on par with disappointing national trends, we have others experiencing double digit growth. The difference in the two? Our growth sellers are using the techniques described above. They are not counting losses, they are making changes. Above all, they recognize the game has changed and it’s time for them to get out there and yes, SELL!!!
Interested in know what your restaurant is worth in today’s market? Contact the Restaurant Brokers at this link for a free valuation