Since their inception a few hundred years ago in Paris, restaurants have become nigh on indispensable. An evergreen industry, people will never not want to go to out to eat. Where do people go to celebrate, assuming they are financially able to? Other than the home, where do family reunions, birthdays, corporate parties, anniversaries, engagement dinners, dates, and other happy events usually culminate? At a restaurant, of course.
However, simply because there will always be a market for restaurants doesn’t mean that succeeding in that market is a straightforward task. On the contrary, it can be an exceedingly challenging industry. Restaurant owners must understand food, how to work with and manage people, how to balance the books, source ingredients, a variety of marketing channels, and really just a handful of remarkably complex operations. Plus, it’s a competitive industry — something that isn’t lost on the majority of folks, but something to contend with regardless.
So, there’s a market for it, you can be successful, but it’s stressful, challenging, and competitive. Could you become a restaurant owner? Should you become a restaurant owner? Maybe, maybe not. It takes an impressive individual, but the world is full of impressive individuals. Today’s post takes a look at what an aspiring restaurant owner needs to understand before beginning their risky and exciting voyage into the world of culinary entrepreneurship. After we highlight some of the cons of starting your own restaurant, we’ll talk a little bit about Online Orders Now and our online food ordering system — something that makes the life of most any restaurateur much more pleasant! As a side note, be sure you check back for part two of this mini-series, in which we shine the spotlight on the number of reasons you should start your own restaurant!
The Cons Of Being A Restaurant Owner
Let’s start with something that might already be on your radar – you’ll have to work long hours. Restaurant owners are veritable renaissance men or women, and you never know what the day might have in store for you. Usually, it will involve you saving the day in some respect with a workable solution to whatever fire you need to put out that day. Even if you are on vacation or just aren’t scheduled to be in your restaurant for that day, you’ll be the one that needs to fix the issue at hand.
Hence, it’s important that your significant other, spouse, and/or family are all comfortable with the prospect of you working long hours. This means they also need to understand what they are signing up for when you open your own restaurant, since it can be quite difficult on partners and children once they are faced with the consistent reality of not seeing you nearly as much as before (we’d assume, at least). Not every family is cut out for the restaurant life, and that’s okay. We’d simply recommend you be upfront about the kind of sacrifice it’s going to take from all of you in order to make this work. This is an industry where nothing short of 100 percent effort will lead to success.
Difficult Profit Margins
A Sageworks study found that the mean net profit margins for the restaurant industry in 2014 were a meager 5.1 percent. Granted, it’s up from 2008, a difficult year for everyone economically, in which margins were a bare-bone .4 percent! And while it’s difficult to cross-compare between industries, you certainly want to be closer to being between 10 and 20 percent profit margins if at all possible.
What makes the industry so difficult? First and foremost, there are more restaurants than there ever have been. In big towns and small cities even, folks are presented with a wide variety of options — they can easily choose between cuisines, pricepoint, dietary restrictions, and whatever other preferences they might have.
Secondly, there are inherently high fixed costs in the restaurant industry. Your ingredients are expensive, you need to pay your employees fair wages, and if you are in an attractive location, your rent is probably monstrous. Thirdly, and we’ll be done after this point, is that it’s really difficult to carve out some marketing real estate so you can achieve visibility. There will be growing pains, and it takes some capital to be able to properly invest in the variety of marketing channels you need to in order to be successful with your marketing efforts. If you try to skim by with the bare minimum, it’s basically throwing your investment straight in the trash can.
Sadly, we are just beginning to scratch the surface when it comes to the drawbacks of opening your own restaurant. We will say though, as an aside, that the majority of the aforementioned “cons” mostly have to do with starting your restaurant. If you can get past the frontloading stage — a stage that often lasts years, mind you — you just well might find yourself living a wonderful life.
However, we have one more major con to address. It has to do with the complex nature of being able to serve tens, if not hundreds, of menu and beverage options. Unless you plan on paying an executive chef an exorbitant salary to make all decisions for you, you’ll need to be prepared to make these kinds of pivotal decisions about your menu and cuisine for yourself. The more options you provide, however, the more unique products you’ll need to have in stock. Being able to have the inventory space, managing the inventory by keeping your ingredients fresh, and other aspects of these processes present quite the logistical challenge. If you are just starting off, you probably won’t have too much inventory space or wiggle room on product cost in the first place.
Don’t be defeated! The above issue doesn’t have to be crippling. We’d recommend starting out with a conservative menu. Make what you do well and grow from there!
Where Online Orders Now Comes Into The Picture
Did you make it through the sobering nature of this post? Our intention is to be honest with our readers, and opening a restaurant is no walk in the park. It’s remarkably challenging, as the above paragraphs have illustrated. But there are ways that you can make the challenge a less daunting one. One of those ways is to have the right kind of company help you take advantage of the wealth of online delivery orders your business will start receiving after you’ve opened. Online Orders Now provides a robust online ordering system that seamlessly integrates with most every POS system restaurants use while making sure that customers who are interested in your kind of cuisine will be able to find you. Once they do, they’ll like what they see in terms of an ordering platform — leading to more loyal customers and bigger purchase prices.
Here’s what Michael K had to say about working with us:
“Business Has Never Been Better Since Starting With Online Orders Now!!”
“These guys have the friendliest staff I have ever worked with. They completed everything not only quickly but with great quality as well. Jed in customer service walked me through everything I needed step by step. Wade called to suggest changes to make my menu even better than before and business has never been better since starting with Online Orders Now!! Definite 5 stars” – Michael K
Why Not Use A Third-Party Delivery Provider?
If you can handle the delivery portion of your to-go orders, we strongly recommend not going with a third-party aggregate delivery provider. Sure, on the surface it seems like they save you the headache of dealing with more logistical issues, and there might be some truth to that. But when you consider the fact that more and more people are ordering delivery and take-out than ever before, you don’t want to be giving away thirty cents of every dollar you make that goes through that third-party.
Here at Online Orders Now, we charge zero order fees — that’s unlimited transactions, whether you get 100 orders per month or 10,000! You pay a flat, monthly fee. You receive our online ordering software, a custom-designed website, a mobile app for your loyal customers, and so much more. We are dedicated to the success of our clients in more ways than simply offering you a product. We will work with you to make sure you take advantage of everything our food ordering system has to offer!
Contact Online Orders Now to learn more!