"Mo money mo problems", as they say, but who doesn’t love a bigger bank, am I right? The restaurant industry is one the most cutthroat industries there is and having a decent profit is something that a good amount of restaurants never see. Yet thousands of new restaurants start in the United States every year, with the hopes of making a living off of doing something they love.

If you may not be a struggling restaurant and are already seeing healthy profits, that’s great. But I think this blog still has a lot to offer regardless of your position in the restaurant/food industry. So let’s get into how we can make more money.

We’ll cover topics ranging from your customer service to your marketing to reducing costs. This blog is a step-by-step tutorial but moves an advice guide on this you should look over in your restaurant business.

1. Hone in on your passion:

We get it, who doesn’t want to make money, but at what cost? You’ll need to have a passion for what you do to bring your profits to where you want because the philosophy of business is that “businesses don’t succeed, people do”.

Having a passion in the restaurant industry doesn’t necessarily mean you love to cook or serve customers, but that in whatever you do, make sure it brings you excitement to get to the next goal. This doesn’t necessarily increase your profit margins or print money but lays the foundation of what’s to come for your OWN business and to start making a profit.

"You can't build a great building on a weak foundation. You must have a solid foundation if you're going to have a strong superstructure." (Gordon B. Hinckley)

2. Increase customer satisfaction and adopt a referral program

I can’t count how many times a restaurant owner or manager doesn’t follow up on negative reviews or set in place an environment where customers know to resolve their issues with management. “92% of consumers read restaurant reviews.” (upserve.com)

This could come from training your employees to actively and periodically communicate with dined-in customers and asking them about their food or service. An even better method of creating an environment for reconciliation is if your employees recognize past customers, tell them to ask the customer how their previous meal or encounter was.

This will train your customers to know that, if they had a bad experience they could have it addressed next time or on the spot. Oppose to your customers just living the experience and having it be an expectation of your restaurant brand. You could also periodically run surveys and offer customers a reward in exchange.

Now in part to customer satisfaction, is referrals or word of mouth. Customer referrals will save you tremendous amounts of money on your marketing, by having your customers do the marketing for you. Develop a method to make it seamless and easy for customers to share your restaurant and not just simply a social media page. For example, for any of your delivery orders, you could leave a flyer with a QR code that automatically links the customer to share their experience.

Social media as your exclusive referral outlet, in my opinion, for true growth that’s just not good enough, you have to make the customer want to do it and not just out of the kindness of their heart or respect for your brand. A friend’s stamp of approval is more valuable than a 5-star review, utilize that. This brings your marketing cost down, thus increasing your profit margins and can have a cascade effect of bringing more customers.

3. Stop growing dependent on delivery services

As a restaurant, you need to eliminate all vulnerability and that starts with delivery, hear me out. At the start of the pandemic, delivery services were the saving grace for many restaurants and still are. However, the subset of your customers they’ve switched to delivery customers are disconnected with your brand, not your restaurant, your brand.

You have limited control of your brand when you have delivery services as your gateway, from the physical appearance on these platforms to the psychological detriment. Coupled that with the rise of ghost kitchens making it harder to compete on these platforms and as a business. You may even benefit from having a ghost kitchen of your own, however, that comes with its own pros and cons.

Nevertheless, as a restaurant owner, your brand is one the most valuable things about you, how do you think Starbucks became what it is today, not because of their overpriced food or free wifi, well maybe their free wifi. It was their branding, there was a Starbucks on every corner. They built trust in the brand which allowed them to grow. You have to figure how to detach your customer’s dependency on these delivery services.

The research is there, customers who use delivery, use it as a utility and not as a platform. They just want food delivered to them, at the cheapest or fastest. They don’t care who does it, so you’re already in a good position. The 2 ways you can decrease your customer dependence are 1. Setting up your own gateway for delivery, for example, the Chick-fil app, allows customers to order for pickup or delivery, however when a customer chooses to deliver they’ve directed a third-party app, meaning the control is in chick fil a’s hand.

The customer comes to them first, not the delivery service. This would also allow them to switch services easily without having to lose customers. The second way is offering customer incentives to come in-store, for example. Customers can only earn points for the loyalty for pickup/drive-thru orders and also promote that in your gateway. In the end, protecting your brand, increases your profits, by allowing you the flexibility to maneuver how you please and build trust to expand.


4. Collect and use data

Make sure your making adjustments to your operations. In the world of tech, many startups run a thing called A/B testing on all parts of their systems and products allowing them to converge to the most optimal solutions. A/B testing is the process is making minor or major changes to an element of a certain object.

For example, say as a restaurant I want every customer to click the order now button when they visit my site, an A/B test you would run is by changing the color and/or shape of the button for a different subset of customers who visit. Then you’ll measure which A/B test produces the best results and incrementally build off of that.

A/B testing can be applied to all parts of your restaurant, from how you handle customer interactions, marketing campaigns, etc. Just make sure your collecting the appropriate data for the appropriate intent and always have an intent in mind. I would go into more detail about the science of A/B testing, along with its pros and cons however this blog post isn’t meant to give you a degree in mathematics.

So here are few resources to learn more about A/B testing.

5. Use technology, it’s not as complicated as you think

This will be put into bullet points of what types of technologies you. I want to be unbiased, so won’t provide a certain brand. However, if you are interested in how certain brands compare for an area of technology listed, you can click on the bullet point and be directed to a blog post about it.

Conclusion

Making a profit is hard while making revenue could be easy and that’s something not all restaurants are able to achieve. The two ways to make a profit are by decreasing your costs of operations or increasing your sales, however when it comes to sales you have to make sure your operating costs don’t increase exponentially due to increasing demand.

We highlighted a few points in the blog that will aid in increasing your profit margins. Making use of data and knowing when appropriate to collect. Creating an environment that breeds customer satisfaction leads to increased sales. And reducing your points of failure in your restaurant operation structure.