Restaurant

Investing in Restaurants – Can It Work?

Investing in restaurants is a tricky business because they are prone to either be incredibly successful or fail altogether. A restaurant that is successful can represent a huge moneymaking opportunity for owners and investors. Unfortunately, most restaurants fail within less than three years of their grand opening. Restaurants high failure rates are caused by a number of different reasons but the most common is management that is inexperienced or owners that are trying to open a new restaurant in an already overcrowded marketplace. In addition, any reasonably sized city is going to offer a very competitive restaurant market.

With these factors in mind, a restaurant that is offering something new and unique can become incredibly successful in no time. Before investing in a restaurant, it is important for any person to do a fair amount of research regarding the partnerships and restaurant business in his or her area. The rapid rise and fall of restaurants may lead some to believe that they are relatively inexpensive to open, but this could not be further from the truth. The cost of opening a new restaurant can be quite expensive, and the higher end a restaurant is more it is going to cost initially.

Restaurant owners often open up investment opportunities for partnerships with in the area to help reduce the costs for opening and operating a restaurant when it is new. Before investing in one of these new restaurants, it is a good idea to get well acquainted with any other individuals that are considering becoming business partners on a restaurant venture. Lunches, meetings, and other types of social

gatherings represent excellent opportunities to get to know the other individuals that are pooling their money with yours. This offers investors the chance to get to know one another and if you find yourself uncomfortable with any or all of the other investors, it may be a good idea to look elsewhere.

Since it is your money that is going into the restaurant, there is no reason to be shy about your thoughts or preference when it comes to the layout or design of the business. Of course, many individuals that invest in restaurants are in it purely for the possible financial gain and have little or no interest in the business itself. However, even an uninterested investor that feels strongly about one particular aspect should speak up rather than silently letting his or her money get spent in a way that they do not approve of.

How to Choose a Restaurant Management Consultant

Have you ever felt seriously short of good talent running your business? It may surprise you to know that you are not alone. In fact, according to a recent survey both restaurant entrepreneurs and chain restaurant executives share a common problem-difficulty recruiting managers who can run their restaurant as if they owned it. That is why it is essential to have a restaurant management consultant who can take over the helm and lead your restaurant to success.

Good restaurant management consultants have several qualities:

  • They are good managers
  • They know what clients want
  • They respond to the demands of competition quickly and effectively
  • They can weather adverse economic conditions
  • They are persistent
  • They know how to hire the best workers
  • They have creativity and patience
  • They think fast
  • They are up-to-date with the latest technologies
  • They are dedicated to creating the best restaurant experience
  • A good restaurant consultant has honed their skills in kitchen, front of the house and institutional operations

The above qualities should give you an indication of what you must look for in your restaurant management consultant.

A restaurant management consultant can perform the following functions:

  • Feasibility studies
  • Business plans
  • Conceptualization and repositioning
  • Restaurant remodeling
  • Design and development of the kitchen and front of the house
  • Menu, food and bar development

In addition, they will also help you with marketing, restaurant strategy development as well as improving profits.

Hiring a restaurant management consultant is a project that requires dedication, research and perseverance.

Before you hire a consultant, you must have a clear idea of your goals. Will you be handing over the financial management of the restaurant to the consultant? Will they be hiring staff? What will be the terms of employment? Will you be hiring them long term?

You need to have a clear understanding of how the restaurant management consultant will go about their tasks. For instance, a good restaurant management contract might stipulate that their activities start with an internal operations audit, which is followed by the drawing up of a detailed action plan that will help the restaurant reach its potential. In this way, the consultant will help you raise your bottom line. That is why it is crucial to take time and hire the right persons for key roles in your business.