7 Reasons New Restaurants Fail (How to Succeed Instead)

Starting a restaurant? A healthy fear of restaurant failure isn’t a bad thing. But no need to panic. The latest research found that only 17% of new restaurants fail in the first year. Instead of focusing on how to survive, learn to thrive. Let this list of 7 reasons for restaurant failure – and how to avoid them – be your guide.

1) The Fail: Poor Planning

You know the saying. Fail to plan, plan to fail. To prepare for success and reduce the risk of restaurant failure, start with a business plan for opening a new restaurant. As you write your plan, pay close attention to these 3 critical variables.

• Wrong Location: The #1 Reason for Restaurant Failure

Experts agree, the most common reason for restaurant failure is choosing a bad location. To find the perfect place, look for spots with plentiful foot and vehicle traffic. What’s nearby? A college campus or office building with potential customers? Dig deep. What business was there before? Were they victims of restaurant failure?

• Customer-Focused Concept and Name

Reality is your friend. You may dream of opening a fancy French restaurant. But if you’re in a blue-collar community, that concept is ripe for restaurant failure. Use these steps to select a successful concept:

1. First, do a demographic analysis. Who lives in a 10-mile radius of your restaurant? Middle class families or trendy young professionals? More seniors or singles? Are there seasonal customers?
2. Build your restaurant concept around the customers identified in the first step. For example, a bistro with global flavors (and a large bar area for socializing) would be ideal if catering to a younger crowd with adventurous palates. Your concept should also be unique and different from other restaurants in town.
3. Select a name that describes your concept. Do your homework to ensure the name isn’t trademarked or could be confused with a competitor.To read full article click on the link