Why most restaurants fail in their first years?

Why most restaurants fail in their first years?

Lack of financial planning, poor business accumen and no management are the big reasons of the restaurant failures. Here are some reasons why most restaurants fail in their first years.

  • THEFTS: Internal thefts and staff embezzlement create gaps in which restaurant owners can track only a little too late.
  • POOR LOCATIONS AND HIGH RENTALS: You may be located too far from your target audience or your ideal location may be draining your pockets. Fewer pockets, running into losses and ultimately shutting down.
  • POOR CUSTOMER EXPERIENCE: If your customers are not enjoying coming to your restaurant, its only a matter of time when they stop reaching fully. You should know how to deliver good customer service.
  • YOUR INEXPERIENCE: Your inexperience can be the reason for your most customers to unreach you.
  • POOR STAFF MANAGEMENT: If you are not able to manage your staff, it may be become a bad experience for your customers. Also increase in cost may be the reason. Poor staff management also lead to out of control labour costs, which is also one of the biggest expenses in restaurant business.
  • POOR ALLOCATION OF RESOURCES: If you don’t know how resources have to be used in different segments of the organisation it will lead you a loss.
  • NO INVOLVEMENT OF OWNER: If you will give all the premises of your restaurant to the staff with no involvement of the owner or the management ultimately it will go shut.

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