Americans eat about a billion meals a day. A huge percent of those meals are eaten somewhere other than homes. That’s one of the reasons running a restaurant has been a time-honored, tried-and-true way to own a small business. But is the local, independent restaurant an endangered species? What can they—or you, if you’re a restaurant owner—do to survive against the onslaught of competition?
Visit any community in America, and you’ll find local restaurants run by a small business owner, often with the whole family helping out. New immigrants open small cafes, bringing their traditional foods, adding flavors to the American melting pot.
But independently owned restaurants, the kind of restaurant where the small business owner knows the regulars by name, are under assault from competition, old and new.
First, there’s chains and franchises, which have been chomping at their numbers. The number of independent restaurants fell by four percent in 2016, while chains grew by one percent, according to research group NPD.
But there’s a whole raft of new competition coming from every corner—and I do mean every corner, where you may find a food truck, a grocery store with ever-expanding ready-to-eat prepared meals, even a Starbucks experimenting with serving evening meals and alcohol. That’s not to mention all the new home-delivered meal kits (like Blue Apron, Hello Fresh, Purple Carrot and now even the always-voracious Amazon getting into the business).
But with Americans eating a billion meals a day (not to mention all the snacking we do), that’s a lot of opportunities to get them to come to your independent restaurant, regardless of the competition. That’s why, according to a recent American Express survey of restaurant owners or managers, over half (54%) report higher revenue than a year ago, and 72% expect increased revenue in the coming year.
So what are some steps you can take to get seats filled in your independent restaurant?
- Emphasize local. The shop local/buy local movement is real. It’s always inviting to go to a café, restaurant, or bar where “everybody knows your name.” If you’re a small restaurant owner, put a face to your establishment by being out in the front of the house, introducing yourself, getting to know the names of your regulars.
- Use local ingredients. According to the American Express survey, over half of customers (56%) feel it’s important for restaurants to use local ingredients. You probably are already. So put the names of the local farmers you use on your menus.
- Use social media. Social media was made for food establishments. Great pictures of enticing food are the ultimate “click bait.” Make sure you have an active feed on Facebook, Instagram, Pinterest, local sites. Encourage customers to post on social media while they’re at your establishment, offering free desserts, appetizers, drinks or other bonuses for showing you their posts as they happen.
- Advertise on social media. There is no more targeted, or affordable, advertising than social media, especially Facebook. If you’re opening an oyster bar, on Facebook, with a few clicks, you can find people who like oysters, like eating out, who are over 21 years old, who live within the same zip code—and get in front of them for a fraction of the cost of a direct mail piece. You can offer daily or seasonal discounts.
- Provide take out. Millennials like take-out. A lot. In the American Express survey, in the previous month, 68% of millennials had ordered food delivery compared to only 36% of Baby Boomers. Look for affordable delivery services that can pick up and delivery your food to customers.
- Pay a fair wage. Want to win a bar bet? Ask what the federal minimum wage is for tipped restaurant workers. It’s a shocking $2.13 an hour. Eighteen states still have that as their minimum wage before tips, and the minimum tipped-worker wage in another 22 states is $5 or less. It’s one of the reasons good hospitality workers are so hard to find, turnover is so high, and theft is rampant in food service. Give yourself a competitive advantage by paying decent wages and training and maintaining good servers. After all, your server is often the face of your restaurant to your diners.
Copyright, Rhonda Abrams, 2017
This article originally ran in USA Today on July 26, 2017