As the holiday season unfolds, many of us reflect on the past year and eagerly anticipate 2024. It's a time for giving and receiving gifts, and this extends to the way we manage our businesses. In this article, we'll explore the concept of gift-giving from the perspective of a restaurant owner. Your restaurant, personified, has its own Christmas wish list. Can you, as an owner, fulfill these wishes?

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1. Regular Financial Health Checkups

Just as people undergo annual health screenings, your restaurant needs monthly financial checkups. The monthly profit and loss (P&L) statements are crucial for assessing the health of your business. Given the recent financial pressures (like labor and food costs), these checkups are vital for early detection and response to potential issues. Think of them as preventative care for your business. The adage here is simple: Regular financial reviews can be the difference between thriving and just surviving.

Compare your business performance with industry benchmarks for prime costs (food, labor, and occupancy). Are your food costs in line? Strive for 28% to 32% food costs but remember that every point that is shaved from the food cost is delivered straight to the bottom line as profit.

Labor costs have been rising but so have average unit sales. Most restaurants have responded to pricing pressure by raising costs for the consumer which has the effect of keeping the cost of labor and food in line. Overall, labor should hover somewhere around 25% of sales. Occupancy, the other large element in prime costs should ideally, be under 10%, and as fixed cost, due monthly, can seem the most overwhelming for operators. This season, focus on costs and regular checkups to keep your restaurant healthy.

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2. Experience Your Restaurant as a Guest

How often do you visit your restaurant not as an owner, but as a guest? This perspective shift can be enlightening. Uneven tables, unclean bathrooms, or the need for better maintenance—issues like these become more apparent from a customer's viewpoint. Adopt the mindset of 'be your own guest' to gain insights into areas needing improvement. Remember, the guest experience extends to every corner, including the kitchen.

Consider a mystery shopping program to get a consistent and unbiased report. Shoppers are paid to visit the restaurant anonymously to provide impartial feedback. This strategy can offer valuable insights into the real customer experience. From this effort, owners can learn behaviors that drive customer satisfaction, ensure consistency, and identify gaps in employee training needs.

3. Invest in People: Staff and Guests

Your restaurant's success hinges on two types of people: your staff and your guests. First, create a work environment that attracts and retains a great team. This includes providing the necessary tools for their success. Second, focus on guest experience to drive word-of-mouth marketing. Track guest data to target your marketing efforts more effectively. A constant influx of satisfied guests is as crucial as a competent team. Does the restaurant have a loyalty program? If not, how do you implement one that allows you to track and analyze your customer demographics and preferences. This data gives you valuable insights for marketing strategies and menu development.

Consider gifting both your restaurant and community at the same time by participating in local events. Charitable giving initiatives raise the profile of the restaurant. Grassroots involvement in the local community can help bring in more guest and build a loyal customer base.

Conclusion: Honesty and Proactive Management

Finally, be honest about your restaurant's performance. If sales are declining, they won't improve without intervention. Sometimes, bringing in external specialists is necessary. Treat your restaurant like you would a child: with love, care, patience, and unwavering support. Remember, nurturing your business is a gift that keeps on giving.

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James Beard famously said, “Food is our common ground, a universal experience.” Think of how you make your restaurant the experience customers are seeking. That is the greatest gift of all this holiday season, to yourself, your employees and your customers.

Eric Gagnon, Certified Restaurant Broker®, CFE, CBI is the founder and president of We Sell Restaurants and co-author of Appetite for Acquisition, the definitive guide for anyone looking to enter the restaurant industry. He is a fellow of the International Business Brokers Association and serves as a board member for VetFran of the International Franchise Association and as a board member for the Southeast Franchise Forum. Eric is an industry expert in restaurant sale and valuation with 20 years of experience brokering restaurants for sale.